Chipmaker AMD has filed an antitrust suit against bitter rival Intel over its dominant position in the OEM industry.
Let’s hope Paul Otellini picked up some Pepcid last night, because Hector Ruiz and AMD are doing their best to give him a bad case of indigestion.
It appears AMD’s patience with the marketplace has finally run out. After years of rejection by PC market leader Dell, and being passed over by Apple when it switched to Intel processors, AMD seems to be saying enough is enough.
AMD claims Intel used a combination of financial inducements and threats to keep AMD out of dozens of companies. It is likely AMD will seek damages equal to billions of dollars in the suit.
Japan’s Fair Trade Commission ruled in March that Intel had violated antitrust laws there. Intel was compelling computer makers there to not use semiconductor chips from other companies. While Intel said it did not agree with the allegations, it removed wording to that effect from its contracts.
AMD filed suit in US District Court for the District of Delaware. The 48-page complaint identifies 38 companies that have been victims of alleged coercion by Intel – including large scale computer-makers, small system-builders, wholesale distributors, and retailers, through seven types of illegality across three continents.
According to AMD, then-Compaq CEO Michael Capellas said in 2000 that because of the volume of business given to AMD, Intel withheld delivery of critical server chips. Saying “he had a gun to his head,” he told AMD he had to stop buying.
Lawsuits happen frequently in the high-tech industry. While many are minor and at best nuisances, Intel could be in trouble if the District Court considers the Japanese FTC ruling as well as an ongoing European Commission investigation into the same issues.
David Utter is a staff writer for murdok covering technology and business. Email him here.
