Welcome!

Agile Computing Authors: Pat Romanski, Shelly Palmer, Glenda Sims, Paul Simmons, APM Blog

Related Topics: Microservices Expo

Microservices Expo: Article

EC Fines Intel $1.45 Billion; Otellini - "Decision is Wrong"

“Intel takes strong exception ... We believe the decision is wrong." - Intel CEO Paul Otellini

The European Commission today fined Intel $1.45 billion because of its “illegal” rebates, which the company was told to abandon immediately. The fine is the largest single penalty the EC regulators have ever exacted, more than the combined fines Microsoft had to pay.

Intel immediately said it would appeal the decision and its general counsel Bruce Sewell said he didn’t know how to comply with the cease and desist order.

“I don’t know what would change,” he said “Intel only has a simple volume discount. The more you buy the lower the price.”

When he said that Sewell and his legal team had yet to thumb through the lengthy EC decision, believed to have been edited to survive appeal, and said he was only working off the EC press release.

Intel CEO Paul Otellini issued a statement saying, “Intel takes strong exception to this decision. We believe the decision is wrong.”

The company claimed in court last year that the EC wouldn’t accept evidence that would have vindicated it.

Otellini’s statement pressed that point. “We do not believe our practices violated European law,” he said “The natural result of a competitive market with only two major suppliers is that when one company wins sales, the other does not. The Directorate General for Competition of the Commission ignored or refused to obtain significant evidence that contradicts the assertions in this decision.

We believe this evidence shows that when companies perform well the market rewards them, when they don’t perform the market acts accordingly.”

>It is unclear how exactly the EC came up with the seemingly arbitrary >1.06 billion euro fine. It is supposed to reflect the value of Intel x86

>sales in the European Economic Area over a period of five years and >three months between October 2002 and December 2007.

>Intel’s worldwide revenue in 2007 was $38.8 billion. The EU is said >to account for 30% of its sales.

>Europe’s antitrust chief Neelie Kroes joked during her press >conference in Brussels that Intel would have to change the tag line in >its new ad campaign from “sponsors of tomorrow” to “sponsor of the >European taxpayer.”

>Intel is accused of giving “wholly or partially hidden rebates” to Acer,

>Dell, HP, Lenovo and NEC on condition that they bought all, or >almost all, their x86 CPUs from Intel.

>It is also accused of paying OEMs to halt or delay the launch of AMD >boxes and to limit their distribution when they did come out.

>It is supposed to have made direct payments to Media Saturn >Holding, owner of the MediaMarkt chain, the only European entity >named in the indictment, to stock only computers with Intel x86 >CPUs.

>Kroes contends that “Intel has harmed millions of European >consumers by deliberately acting to keep competitors out of the >market for computer chips for many years. Such a serious and >sustained violation of the EU’s antitrust rules cannot be tolerated.”

>She promised to actively monitor Intel’s compliance with the >decision.

The Commission said that it “does not object to rebates in themselves but to the conditions Intel attached to those rebates.”

It says the illegal condition aren’t explicit in Intel’s contracts but claims it found proof they exist when it raided Intel, OEM and retailer offices and pulled e-mail. It also has formal statements from the other companies concerned along with “evidence that Intel had sought to conceal the conditions associated with its payments.”

The EC claims Intel structured its prices to ensure that an OEM who bought AMD parts would lose a “significant rebate” on its Intel purchases. It claims the situation would have forced AMD, which it described as “just as efficient as Intel,” selling chips under cost to compete for the business.

It said AMD offered an OEM a million free CPUs but the offer was refused because the OEM would have lost Intel’s rebate on the rest of its million of chip purchasse. In the end, the OEM only took 160,000 CPUs for free.

It claims Intel-style rebates are illegal elsewhere in the world too.

At a press conference later today Intel is reportedly going to bring witnesses to refute these charges.

AMD, where today will be like Marti Gras, expects to leverage the EC’s findings in its own antitrust case against Intel in the US. It goes to trial next year and there’s a pretty penny at stake.

AMD may also finally be able to entice the Justice Department into investigating Intel, a feat that has so far eluded it though it did get Intel in Dutch with regulators in Korea and Japan as well as Brussels.

The new head of the DOJ’s Antitrust Division Christine Varney, the ex-Netscape lawyer appointed by the Obama White House, expects to “restore an aggressive enforcement policy against corporations that use their market dominance to elbow out competitors or keep them from gaining market share,” according to a speech she gave Monday morning that was first reported by the New York Times.

The policies of the Bush administration, which interpreted antitrust law differently, are supposed to have pushed the little guy to complain to the EC and regulators in the Far East.

Varney has officially rescinded the Bush guidelines for courts and private litigants memorialized in a 215-page report written by the DOJ last year that supposedly made cases involving monopoly and predatory practices hard to bring.

The move, coupled with the EC’s decision, could encourage the Federal Trade Commission, which has been investigating Intel and where Verney was once a commissioner, to turn its probe into a suit.

More Stories By Maureen O'Gara

Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

Comments (0)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


@ThingsExpo Stories
DX World EXPO, LLC, a Lighthouse Point, Florida-based startup trade show producer and the creator of "DXWorldEXPO® - Digital Transformation Conference & Expo" has announced its executive management team. The team is headed by Levent Selamoglu, who has been named CEO. "Now is the time for a truly global DX event, to bring together the leading minds from the technology world in a conversation about Digital Transformation," he said in making the announcement.
"Space Monkey by Vivent Smart Home is a product that is a distributed cloud-based edge storage network. Vivent Smart Home, our parent company, is a smart home provider that places a lot of hard drives across homes in North America," explained JT Olds, Director of Engineering, and Brandon Crowfeather, Product Manager, at Vivint Smart Home, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
SYS-CON Events announced today that Conference Guru has been named “Media Sponsor” of the 22nd International Cloud Expo, which will take place on June 5-7, 2018, at the Javits Center in New York, NY. A valuable conference experience generates new contacts, sales leads, potential strategic partners and potential investors; helps gather competitive intelligence and even provides inspiration for new products and services. Conference Guru works with conference organizers to pass great deals to gre...
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and shared the must-have mindsets for removing complexity from the develop...
In his Opening Keynote at 21st Cloud Expo, John Considine, General Manager of IBM Cloud Infrastructure, led attendees through the exciting evolution of the cloud. He looked at this major disruption from the perspective of technology, business models, and what this means for enterprises of all sizes. John Considine is General Manager of Cloud Infrastructure Services at IBM. In that role he is responsible for leading IBM’s public cloud infrastructure including strategy, development, and offering m...
"Evatronix provides design services to companies that need to integrate the IoT technology in their products but they don't necessarily have the expertise, knowledge and design team to do so," explained Adam Morawiec, VP of Business Development at Evatronix, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
To get the most out of their data, successful companies are not focusing on queries and data lakes, they are actively integrating analytics into their operations with a data-first application development approach. Real-time adjustments to improve revenues, reduce costs, or mitigate risk rely on applications that minimize latency on a variety of data sources. In his session at @BigDataExpo, Jack Norris, Senior Vice President, Data and Applications at MapR Technologies, reviewed best practices to ...
Widespread fragmentation is stalling the growth of the IIoT and making it difficult for partners to work together. The number of software platforms, apps, hardware and connectivity standards is creating paralysis among businesses that are afraid of being locked into a solution. EdgeX Foundry is unifying the community around a common IoT edge framework and an ecosystem of interoperable components.
Large industrial manufacturing organizations are adopting the agile principles of cloud software companies. The industrial manufacturing development process has not scaled over time. Now that design CAD teams are geographically distributed, centralizing their work is key. With large multi-gigabyte projects, outdated tools have stifled industrial team agility, time-to-market milestones, and impacted P&L stakeholders.
"Akvelon is a software development company and we also provide consultancy services to folks who are looking to scale or accelerate their engineering roadmaps," explained Jeremiah Mothersell, Marketing Manager at Akvelon, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
"IBM is really all in on blockchain. We take a look at sort of the history of blockchain ledger technologies. It started out with bitcoin, Ethereum, and IBM evaluated these particular blockchain technologies and found they were anonymous and permissionless and that many companies were looking for permissioned blockchain," stated René Bostic, Technical VP of the IBM Cloud Unit in North America, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Conventi...
In his session at 21st Cloud Expo, Carl J. Levine, Senior Technical Evangelist for NS1, will objectively discuss how DNS is used to solve Digital Transformation challenges in large SaaS applications, CDNs, AdTech platforms, and other demanding use cases. Carl J. Levine is the Senior Technical Evangelist for NS1. A veteran of the Internet Infrastructure space, he has over a decade of experience with startups, networking protocols and Internet infrastructure, combined with the unique ability to it...
22nd International Cloud Expo, taking place June 5-7, 2018, at the Javits Center in New York City, NY, and co-located with the 1st DXWorld Expo will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud ...
"Cloud Academy is an enterprise training platform for the cloud, specifically public clouds. We offer guided learning experiences on AWS, Azure, Google Cloud and all the surrounding methodologies and technologies that you need to know and your teams need to know in order to leverage the full benefits of the cloud," explained Alex Brower, VP of Marketing at Cloud Academy, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clar...
Gemini is Yahoo’s native and search advertising platform. To ensure the quality of a complex distributed system that spans multiple products and components and across various desktop websites and mobile app and web experiences – both Yahoo owned and operated and third-party syndication (supply), with complex interaction with more than a billion users and numerous advertisers globally (demand) – it becomes imperative to automate a set of end-to-end tests 24x7 to detect bugs and regression. In th...
"MobiDev is a software development company and we do complex, custom software development for everybody from entrepreneurs to large enterprises," explained Alan Winters, U.S. Head of Business Development at MobiDev, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Coca-Cola’s Google powered digital signage system lays the groundwork for a more valuable connection between Coke and its customers. Digital signs pair software with high-resolution displays so that a message can be changed instantly based on what the operator wants to communicate or sell. In their Day 3 Keynote at 21st Cloud Expo, Greg Chambers, Global Group Director, Digital Innovation, Coca-Cola, and Vidya Nagarajan, a Senior Product Manager at Google, discussed how from store operations and ...
"There's plenty of bandwidth out there but it's never in the right place. So what Cedexis does is uses data to work out the best pathways to get data from the origin to the person who wants to get it," explained Simon Jones, Evangelist and Head of Marketing at Cedexis, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
SYS-CON Events announced today that CrowdReviews.com has been named “Media Sponsor” of SYS-CON's 22nd International Cloud Expo, which will take place on June 5–7, 2018, at the Javits Center in New York City, NY. CrowdReviews.com is a transparent online platform for determining which products and services are the best based on the opinion of the crowd. The crowd consists of Internet users that have experienced products and services first-hand and have an interest in letting other potential buye...
SYS-CON Events announced today that Telecom Reseller has been named “Media Sponsor” of SYS-CON's 22nd International Cloud Expo, which will take place on June 5-7, 2018, at the Javits Center in New York, NY. Telecom Reseller reports on Unified Communications, UCaaS, BPaaS for enterprise and SMBs. They report extensively on both customer premises based solutions such as IP-PBX as well as cloud based and hosted platforms.