• What
    is this?
    You've landed on the AMD Portal on AnandTech. This section is sponsored by AMD. It features a collection of all of our independent AMD content, as well as Tweets & News from AMD directly. AMD will also be running a couple of huge giveaways here so check back for those.
    PRESENTED BY

In the long-running saga of Intel’s conflicts with various national trade commissions, 2009 was a lousy year for Intel. The European Commission fined Intel for nearly 1.5 billion USD, the US Federal Trade Commission sued Intel on anti-trust grounds, and Intel settled with AMD for another 1.25 billion USD. If nothing else it was an expensive year, and while Intel settling with AMD was a significant milestone for the company it was not the end of their troubles.

Now just shy of 9 months after the FTC’s lawsuit began, Intel’s conflicts are starting to come to an end. While the European Commission’s fine is still on appeal, Intel can close the book on their troubles with the FTC: Intel and the FTC have reached a settlement ahead of what would have been next month’s court hearing. With this settlement the FTC is agreeing to drop the case in return for a series of prohibitions and requirements placed upon Intel to maintain and enhance the competitive environment in the CPU and GPU markets. However true to their word, the FTC did not push for any fines – this is a settlement of actions, and not one of greenbacks.

Background

As a quick refresher, the FTC had been investigating Intel for a number of years. Ahead of their suit in December of 2009 the FTC brought Intel to the table and tried to negotiate a settlement, but that didn’t come to pass. In the meantime Intel and AMD reached a separate truce back in November of 2009, an important distinction as AMD had been the primary instigator of all of the investigations against Intel. Ultimately the FTC decided to take their case forward without further help from AMD, a somewhat surprising move that at first glance seems to have largely panned out in the FTC’s favor.

In the suit, the FTC listed a number of complaints towards Intel over both the CPU and the GPU markets, where in the former Intel is the dominant player, and in the latter their market share has been increasing over the years as IGPs grow in popularity. The FTC’s complaints were roughly as follows:

CPU

  1. The usual complaints we’ve seen from the EU. Intel rewarded OEMs to not use AMD’s processors through various means, such as volume discounts, withholding advertising & R&D money, and threatening OEMs with a low-priority during CPU shortages.
  2. Intel reworked their compiler to put AMD CPUs at a disadvantage. For a time Intel’s compiler would not enable SSE/SSE2 codepaths on non-Intel CPUs, our assumption is that this is the specific complaint. To our knowledge this has been resolved for quite some time now.
  3. Intel paid/coerced software and hardware vendors to not support or to limit their support for AMD CPUs. This includes having vendors label their wares as Intel compatible, but not AMD compatible.
  4. False advertising. This includes hiding the compiler changes from developers, misrepresenting benchmark results (such as BAPCo Sysmark) that changed due to those compiler changes, and general misrepresentation of benchmarks as being “real world” when they are not.


The GeForce 9400M: Intel's chief competitor in the Core 2 integrated graphics market and a threatened product line

GPU

  1. Intel eliminated the future threat of NVIDIA’s chipset business by refusing to license the latest version of the DMI bus (the bus that connects the Northbridge to the Southbridge) and the QPI bus (the bus that connects Nehalem processors to the X58 Northbridge) to NVIDIA, which prevents them from offering a chipset for Nehalem-generation CPUs.
  2. Intel “created several interoperability problems” with discrete CPUs, specifically to attack GPGPU functionality. We’re actually not sure what this means, it may be a complaint based on the fact that Lynnfield only offers single PCIe x16 connection coming from the CPU, which wouldn’t be enough to fully feed two high-end GPUs.
  3. Intel has attempted to harm GPGPU functionality by developing Larrabee. This includes lying about the state of Larrabee hardware and software, and making disparaging remarks about non-Intel development tools.
  4. In bundling CPUs with IGP chipsets, Intel is selling them at below-cost to drive out competition. Given Intel’s margins, we find this one questionable. Below-cost would have to be extremely cheap.
  5. Intel priced Atom CPUs higher if they were not used with an Intel IGP chipset.
  6. All of this has enhanced Intel’s CPU monopoly.

The purpose of the suit and what would have been the associated trial would have been for the FTC to prove that Intel engaged in these actions, and more importantly that these actions were harmful to the market to a significant enough degree to run afoul of Section 5 of the FTC Act.

One other piece of more recent background information involves Dell. Dell has been under investigation by the US Securities & Exchange Commission for the past few years regarding financial irregularities. Those irregularities, as the SEC charges, were due to Intel’s secret rebates to the OEM to not use AMD processors. When Dell began using AMD processors in 2007 and those rebates stopped, Dell ceased to turn a profit.

In turn, since these payments were secret, investors had no idea that the only reason the company was profitable was due to these payments as opposed to entirely above-the-board measures by the company. The end result was that the SEC sued Dell, and last month Dell settled the case by paying a $100 million fine to the SEC. As is the case with similar settlements, the case is not legally binding proof of Intel’s actions, as Dell neither had to confirm nor deny the SEC’s charges (in essence allowing them to claim that the settlement is just the easiest way to get the SEC out of the way). It does however show us just how large Intel’s rebates to OEMs may have been.

The Settlement
POST A COMMENT

63 Comments

View All Comments

  • crimson117 - Thursday, August 05, 2010 - link

    It's frustrating that the SEC can just settle over such a severe issue.

    We'll never know the extent of the payments or how badly Dell and Intel misled their investors because Dell bought off the SEC for $100 million.

    Although the FTC didn't prove anything, at least they made Intel promise not to do those things in the future.

    Unless a settlement establishes accountability and responsibility, and sets things straight, it's just a bribe.
    Reply
  • AmdInside - Thursday, August 05, 2010 - link

    I think the real winner in all of this was Intel. They did not have to concede much nor pay a heavy penalty.

    AMD came second for their CPU businesses.

    The settlement almost does nothing for the GPU business so NVIDIA got screwed.

    Does Via do anything today with their x86 license?
    Reply
  • Taft12 - Thursday, August 05, 2010 - link

    yes they do - the C7 is lacking in performance, but you can run x86 Windows and Linux on it no problem:

    http://www.newegg.ca/Product/Product.aspx?Item=N82...

    Unfortunately the Atom really made this stuff from Via obsolete.
    Reply
  • Rayb - Friday, August 06, 2010 - link

    For Nvidia has to takeover Via to compete in the future with intel, it's their only option if they want to remain viable to go head to head with the competition. Reply
  • synaesthetic - Monday, August 09, 2010 - link

    I've been saying this for over a year now. NVIDIA needs to buy VIA, VIA needs to release an improved counter to Atom and NVIDIA needs to stop putting ION in netbooks with Intel processors.

    NG-ION was really disappointing due to the chipset issue. Thanks to the limited PCIe lanes available to the GPU, the GT218 performs almost as poorly as a 9400M (not that the GT218 is a very good GPU anyway).

    None of the new ION netbooks are as good as the HP Mini 311 is.
    Reply
  • sotoa - Thursday, August 05, 2010 - link

    This was a great article. An easy read too.
    Interesting how Dell is now not turning a profit. LOL! But that's big business for ya.

    It's a shame that AMD's 64 got crippled because of Pentium 4. AMD had a good run back then.
    Reply
  • Wurmer - Saturday, August 07, 2010 - link

    ''It's a shame that AMD's 64 got crippled because of Pentium 4. AMD had a good run back then.''

    It's not so much that AMD's 64 has gotten crippled by the crappy Netburst Pentium 4 as much as it has been crippled by Intel's very questionable way of doing business. What the quality of their product couldn't impose, their money did. Back then, AMD had clearly the best product but it seems that it didn't not suffice for obvious reasons. A lot of storms and bumpy roads can be weathered when you spread enough money around...
    Reply
  • tejas84 - Thursday, August 05, 2010 - link

    Well Anand you are a self confessed Intel fanboy and I can imagine you are not too happy at what has transpired with Intel.

    Intel now have to play on level terms and I think that Nvidia and AMD are going to show what they are made of.

    No more swooning over people like Pat Gelsinger any more for you Anand. The Intel joyride was fun but is now coming to an end.

    Anand I would like you to meet the future.... AMD and Nvidia please step forward
    Reply
  • Pirks - Thursday, August 05, 2010 - link

    "Nvidia please step forward"
    then bend over and open your gape hole wider, Intel has some more QPI/DMI love for ya, HARDcore style!
    Reply
  • Taft12 - Thursday, August 05, 2010 - link

    I think Intel's business practices are deplorable and this slap on the wrist is a slap in the face to the US consumer, but Anand is certainly entitled to be a fan of their engineering accomplishments.

    I am too, even if I won't buy any.
    Reply

Log in

Don't have an account? Sign up now