Wednesday, 13 May 2009

Record fine for computer chipmaker Intel

The European Commissioner for anti-competitive practices, the Dutch lady Nelie Kroes, has announced US chipmaker Intel has been fined a record 1.07 billion Euros, equivalent to $1.45 billion or £ 950 million.

In 2000 rival company Advanced Micro Devices (AMD) filed a complaint in Brussels stating ‘that Intel had paid computer manufacturers not to use AMD chips in computers sold in Europe.

Eight years of investigation convinced the European Commission that Intel had given hidden discounts and financial favours to computer manufacturers if they only used Intel chips. Retailers were paid money so they would only sell computers with an Intel chip. ‘Nickel Neelie’ Kroes, who has a reputation in Brussels to be fair but ruthless, said in a statement: “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 antirust rules can not be tolerated.

The mega fine dwarfs the 500 million Euros Microsoft was forced to pay in 2004, when the Commission ruled it had abused its dominant market position.