A lot of folks out there were waiting for this post! :) Hope I haven't disappointed them. As always, I love playing neutral!
Most of you, I believe, are aware of the European Commission's ruling yesterday, where it imposed a hefty fine of EUR1.06 billion on Intel for abuse of dominant position, and also ordered Intel to cease illegal practices.
Intel president and CEO, Paul Otellini also issued a statement regarding the EC's decision. Later, AMD too, came out with its own statement, where it also highlighted some other instances of Intel's practices (click the link).
Thereafter, I've been reading a whole lot of posts on the Internet and elsewhere. Apparently, it has been a busy 24 hours for the industry and a whole lot of people!
I have friends at both AMD and Intel, and naturally requested to speak with them. Intel has already spoken with me, and I hope to have AMD here soon! :)
Intel's take on EC's ruling; to appeal
An Intel company spokesperson said: "We respect the Commission and its procedures. However, we believe that the decision is wrong because it fails to consider all of the evidence and we will appeal. Among other mistakes, the decision ignores the reality that the microprocessor market is highly competitive and works to the benefit of consumers worldwide. Regulators should be in favor of the lower prices that result from discounting. Under the Commission's rules, Intel is entitled to ask the court to review the decision."
All of this leaves me with a similar thought as before -- what course of action should the global semiconductor industry now take? Will this EC fine on Intel go along in any way in improving the microprocessor market? How will this ruling help AMD improve its position and possibly affect Intel's position in the market, especially in Europe? We are talking about improving competitiveness here!
The Intel spokesperson said: "We believe this is a retrograde step that has the potential to dampen innovation and competition in the market. Ultimately, it is consumers who stand to lose out, through higher prices. Computing power that cost $1 in 2000 now costs US 1 cent today. This came about as a result of vigorous competition in the microprocessor market segment."
Yes, what AMD seeks to get out of this remains to be seen, and I have consulted them as well. Am awaiting its responses, which should be here tomorrow, hopefully!
The Intel spokesperson continued: "It has long been our viewpoint that when AMD has performed well, the market rewarded them; when AMD hasn't performed, the market has acted accordingly. AMD, the sole complainant in this case, is alive, healthy, and claims to be expanding its business."
Quite so! AMD has an aggressive product roadmap, which it revealed last November! It now has to religiously deliver on schedule, and then try to grab better market share. I've seen some of its latest products and those are quite good!
Will this ruling benefit consumers?
I have some other queries! How will this EC ruling benefit the consumers? After all, I am definitely a very choosy consumer, and am sure there are millions of such folks, like me, out there.
Therefore, will the EC ruling in any way influence consumers to buy more rival products, other than Intel's? AMD has welcomed this EC fine, and that is quite all right, but how will all of this help the industry or the chip market? Or even help companies to either improve or worse, reduce market shares?
The Intel spokesperson said: "It won't! Among other mistakes, the EU's decision ignores the reality that the microprocessor market is highly competitive and works to the benefit of consumers worldwide. Regulators should be in favor of the lower prices that result from discounting.
"We intend to continue to compete vigorously by offering customers and consumers the best products at the best prices, and, during the appeal, we will do that within the context of the Commission's decision." Now, to see what AMD has to say!
To my friends on both sides -- Intel and AMD -- just focus on your core businesses! :) A request!