Aceshardware

Nice strawman you got there.

When Intel fumbled with Prescott uarch and AMD pushed K8 into the client space the
free market worked as it should - AMD gained market share and Intel lost market share.
Heck, AMD even racked up a bunch of back to back profitable quarters, a pretty rare
feat over its entire existence. But what were you expecting? A Dan Akroyd/Eddie
Murphy style trading places? Sorry but real world effects intrude on fan boy fantasy
land. Intel still had immense global brand power, far larger manufacturing capacity,
and one stop shopping for chipsets/platforms. And it had co-marketing dollar leverage
far beyond AMD's ability to match, so cry me a river.

What happened in act two of this geek tragedy for the faithful? AMD's screwing the
pooch for years failing to follow up K8 caught up to it when Intel executed a all hands
on deck effort to bring forth a brand new and superior CPU uarch with an exquisitely
tuned implementation in 65 nm. Again the free market worked as one would expect -
AMD lost the market share it gained in the Prescott vs K8 days and Intel gained it back.
As the tables turned AMD greatly multiplied its own pain blowing $6B on ATI, most of
it borrowed. Then it overpromised and underdelivered with the bug ridden Barcelona.
These two massive screw-ups happened on Hector "the wrecker" Ruiz's watch. As a
result the chip house that Jerry Sanders built had to go fabless. The only good thing
about being an AMD CEO (besides disproportionately grandiose compensation) is no
matter how incompetent you are you can always blame Intel and find an audience
idealogically predisposed to accept it unquestioningly. :-D

really? free market "working as it should" the Paul Demone way:


Worlds largest computer manufacturer is not free to sell what it and its customers want, not even using chips that cost them nothing, because of the repercussions and the financial stranglehold intel holds over them.

I guess we have very different ideas on what is a free market. I guess your idea of free is "free for intel to do abuse its market dominance".

I'm not going to comment on Intel's guilt or lack of, but I want to point out that if the case was that much of a slam dunk, Intel would've probably been nailed to the wall by the US DoJ already. I would expect companies that big to do all they can to cover up any questionable practices. There is definitely evidence, but to hold up in court they'll need to gather it carefully and link it all to build a compelling case.

Paul,

I do not think ideology is an issue here (even with the smiley face). The fact Intel makes great products and is a very successful company does not give them the right to (allegedly) use unfair and illegal tactics while competing in the marketplace. Fair competition is the principal ingredient of a free market society, and God help us if we are left with Intel as the only supplier of X86 chips. Even the current situation is already bad, reminds me of the good ol' Soviet Union, if you wanted a car, you would:

a) Get Volga (read Intel) if you were lucky
b) Get a Lada/Moskvich ( read AMD) if you were less lucky

No more options. I do not want to be in the situation where I _have_ to buy a Volga, because there are no other alternatives :)

Regards,


Jose

I hate to break this news to you but Intel's biggest competitor for a sale today is
the Intel chip that customers bought 2, 3, or 4 years ago and is happily humming
along doing what is asked of it. AMD is noise.

Intel's increasingly hard job is to add enough value in the form of higher useful
performance and better features (lower power, better platform level security and
easier manageability etc) to convince customers to *replace* their existing Intel
systems. Look at how Intel is marketing Nehalem - not against Opteron (installed
base is too small to bother) but against older Xeon processors.

Intel is also pushing x86 into existing segments where it is currently has little
presence or simply creating new segments that didn't exist. IIRC last quarter
Intel sold over $400m worth of Atom silicon or roughly 40% of AMD's total MPU
revenue.

Intel is forced to produce better products for existing markets and invent new
products for new markets year after year in order to keep growing (and make
Wall street happy) whether AMD is around or not.

But at what pace or price is of no importance to you. You rave violently against any $100M state subsidy for AMD (remaining mute about such subsidies for intel), but you dont care about who is financing intel's yearly $5B+ monopoly profits. There is no way intel could sustain such profits for decades in a working free market, and that money comes out the same taxpayers' pockets, your and mine, as we have no alternatives but pay monopoly taxes to intel (and microsoft). But again a free market to you is a market where intel is free to extort any price they wish, because there are no alternatives, or potential alternatives are muscled out of the market. A market free of anitrust enforcement. That sort of freedom, working to accumulate more monopoly profits for its shareholders.

(Of course if any competing company finds itself with a dominant market position you will rave against any alleged monopoly abuse.. IBM protecting its mainframe market for instance, now that is evil. IBM is an evil monopolst, Intel a Good one. Ive never seen you argue again microsoft, perhaps you think thats a Good monopoly as well, but then MS is not competing against intel so I guess thats ok).

Sorry to disappoint you but the intrinsic economics of the semiconductor industry is neither
a level playing field nor has a Disney-esque sense of fairness when it comes to vendors of
different sizes and capabilities.

Extremely steep curves of economy of scale, learning curve, and minimum barrier to entry
means the rich and more competent gain ever larger advantage while the poor and less
incompetent go fabless and/or disappear. There's always the danger of sudden technology
and/or market shift or bad bet leaving a competitor of any size high and dry but the big
usually get a second or even third chance to set things right while small players typically
don't. Boo frigging hoo, life ain't fair, get over it.

Intel is highly profitable because it sells high ASP chips made in the newest processes in
huge volumes and has huge economy of scale and lowest per unit cost of manufacturing
and amortized NRE. Being highly profitable it can invest in process R&D and new fabs, and
support multiple huge design teams and equip them lavishly. That is a positive feedback
loop that increases Intel's market presence over time while kicking competitors to the side
of the road. That is a reality the technically ignorant can't understand and the ideologically
fixated won't accept and they instead resort to monstrous conspiracy theories to explain
Intel's success. Or maybe it is a simply a matter that also-rans in life find it easier to relate
to also-ran companies in the business and technology worlds as it is always far easier to
blame others for your station in life then to take responsibility for the long chain of choices
and fundamental limitations that got you there.

Hey, I can use that argument as well, why then you are upset about the EU screwing Intel for 1bill quid? Or the NY GA filing a suit? Boo frigging hoo, life ain't fair, get over it. :)

Regards,

Jose

Of course, you already forgot Intel's progress when had virtually no competition from AMD? The little Mhz bumps from quarter to quarter? It took a kick in the rear with the K7 for them to react and do something, although the P4 can hardly be qualified as a brilliant CPU. Then the K8 caught Intel with their pants down, and only then they started executing brilliantly! Come on, Intel _needs_ AMD.


Well, not with me, I guess I'm one of those losers that keeps buying AMD CPUs, my last Intel chip was a Pentium MMX.

Regards,

Jose

So basically you are saying a free and competitive market is not working and can not work here (even if intel is not using illegal methods to protects its dominance?). Sounds like you're pleading for government intervention. Perhaps break up intel?



Monstrous conspiracy theories? We're just quoting HP and Dell execs. Not too mention antitrust rulings in the EU, Japan and Korea. You're the one trying to explain those away with wild conspiracy theories about electoral motivation of prosecutors all around the world and political considerations or fanboyism.



Hilarious.

Well if Paul is allowed wild political conspiracies then so am I.

Is it a coincidence intel is prosecuted and convicted for monopoly abuse all over the world, but the US is so reluctant to act ? Maybe not. After all intel enjoys a worldwide near monopoly. 80% of intel's revenue comes from outside the US, while the majority of the taxes flow back back to the US in one form or another. By allowing intel to abuse its dominance unchecked and reaping in multi billion dollar monopoly profits, what you essentially get is a worldwide tax on computers mostly benefiting the US (government, shareholders, employees) at the expense of mostly foreign consumers. Interestingly, even consumer prices somehow are considerably lower in the US compared to abroad, reinforcing this effect. (The exact same applies to microsoft btw, which unsurprisingly is also a bigger target for antitrust cases outside the US).

Now even if in a working free market, intel's (/MS's) competitors would also be predominantly US companies, the money flow reduction to the US would probably be in the billions as monopoly profits would dwindle and consumer prices would drop... worldwide.

Similar things happen everywhere. For instance the Belgian energy market is dominated by a few companies all wholly or partially owned by a French giant called Suez, which extorts some of the highest electricity prices in Europe from us (despite ample cheap nuclear energy production and cheap transportation costs due to our very high population density). Of course France, which itself enjoys surprisingly cheap energy, is not willing to act on that, the profits flow back there. The French state even owns 35% of Suez, which made >$10B profits last year. Our own government while pretending to try and change the situation is either unable and too incompetent to liberalise our energy market, or they enjoy their crumbs of the gigantic monopolistic profits, Im not sure. Either way, international monopolies are protected by their homestates where the money returns. Foreign consumers pay the price. I think you could safely call it a tax.

This hits a point of enormous international (and US) outrage.....

The ruthless, mob like, dirty-cop-style reign of Thomas O. Barnett....
He returned now working full time for Microsoft's anti-trust law firm
in which he's a top partner.

He was lobbied in the US DoJ's as the assistant attorney general
in power of the anti-thrust division under the Bush administration
where he preached the blessings of monopolies:

"The potential to obtain monopoly profits serves as an important
incentive to create better products for consumers"

He did not only abuse his double role power to torpedo all monopoly
investigations against Intel and Microsoft but he became real mean
and mob-style-dirty in conveying the revenge and wrath of the old boys
network of Intel's capital investment division.

Dozens of European, Korean and Japanese high ranked company officers
were thrown into the US dungeons, prosecuted, fined and jailed because
they dared to unite against the personal get rich scheme of the Intel
old boys network.

The Intel capital old boys invested their money in (and controlled the
board of directors of) Rambus in order to abuse the monopoly power of
Intel to extract billions from the DRAM industry into their own pockets
via their Rambus shares.

The rage and wrath of the old boys was merciless against those who
dared to unite against the monopoly powers, setting a bloody example
to show what will happen with anybody who resists obedience.

The ruthless revenge: Prosecuted, Fined and Jailed:
http://www.google.com/#hl=enf&num=100&q=site%3Awww.usdoj.gov+DRAM+price+fixing+jail&fp=1&cad=b
http://www.google.com/#hl=en&safe=off&num=100&q=Thomas+O.+Barnett%2C+jail+dram&fp=1&cad=b

Neelie Smith Kroes on Thomas O Barnett's double role: "totally unacceptable"
http://blogs.wsj.com/law/2007/09/19/antitrust-law-armageddon-thomas-barnett-v-neelie-kroes/

Thomas O Barnett abusing his double role power against Google:
http://www.nytimes.com/2007/06/10/business/10microsoft.html?_r=1

Thomas O Barnett himself on the website of his lawfirm on his role
as assistant attorney general in power of the DOJ anti-thrust division:

"Mr. Barnett was involved in some of the largest and most complicated
criminal matters in the Division’s history"

http://www.cov.com/tbarnett/

How true.....

Perhaps you should read the complaint Page 42:



I dont know intel's production costs, but I know they are more than -$1000.

You should read the rest too btw. Well worth the time.

Netburst, buggy RDRAM chipsets, Itanium. Yes, clearly Athlon and Opteron were worse...

Paul has also conveniently forgotten that besides Ruiz, who isn't indicted yet, people from Intel Capital *were* indicted. One crime doesn't wash another either.

I cant really say I see intel's hand in that, but i will say I find it strange that being part of a pricing cartel gets you effective jail time, while leading a far more powerful one-company cartel doing comparable illegal acts to artificially inflate prices and retain marketshare (while causing far graver economic damage) only gets your company a fine.(I might add, in the EU case, a fine so small its barely a fraction of the profits made from committing that crime. im sure Intel would love to pay €1B fine every 5 or 10 years to keep doing what it does)

Is there any chance Intel execs, if found guilty, can be held personally liable and can be personally punished in this or other antitrust cases?