AMD Tries To Break Intel Chokehold

    June 28, 2005

AMD filed an antitrust suit to attempt to break the “chokehold” they assert Intel has on the processor market. They claim numerous anti-competitive moves Intel has made in the past up to an including threats to computer companies for electing to use AMD products in any form or fashion.

AMD’s 48-page suit called Intel’s practices comparable to Standard Oil and Alcoa Aluminum in years past. The suit mentions threatened retaliations to companies doing business with AMD, economic coercion of major companies like Hewlett-Packard, IBM and even retailers like Circuit City.

AMD Tries To Break Intel "Chokehold"

Hector Ruiz, Chief of AMD said this in a letter on their website, “Our competitor has harmed and limited competition in the microprocessor industry. On behalf of ourselves, our customers and partners, and consumers worldwide, we have been forced to take action.”

They’ve quoted former Compaq Michael Capellas as saying Intel withheld delivery of critical server chips because of the volume of business with AMD. “He had a gun to his head,” and then told AMD he had to stop buying.

AMD asserts that Intel’s behavior has gotten worse as AMD’s new designs for processors moved ahead of Intel’s particularly with regard to the new 64 bit processors.

AMD said all these practices combined with requirements retailers maintain high levels of Intel based computers and this would force retailers to lower or eliminate their quantities of AMD based computers. They claim that these tactics basically eliminated the choice for consumers and worked to drive up prices.

The lawsuit claims that Intel controls 90% of the market for processors and because they control so much, they own a monopoly. AMD says Intel wields that power like a sledge hammer.

Abusing its market power by forcing on the industry technical standards and products that have as their main purpose the handicapping of AMD in the marketplace.

Intel denied AMD access to the highest level of membership for the Advanced DRAM technology consortium to limit AMD’s participation in critical industry standard decisions that would affect its business.

Intel designed its compilers, which translate software programs into machine-readable language, to degrade a program’s performance if operated on a computer powered by an AMD microprocessor.

It would seem that AMD’s got quite a case. During a press conference earlier today, AMD said they would like to see a similar timetable as the Microsoft antitrust suit, which took about 18 months. They would like to see this pan out before the end of next year. The investigation phase has already begun.

John Stith is a staff writer for WebProNews covering technology and business.