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May 15, 2009

Intel says anti-trust fine is “unfair”

Rebates are standard practice, says chip maker

By Steve Evans

Chip maker Intel has again criticised the European Commission’s decision to fine the company €1.06bn (£950m) for breaking European anti-trust regulation. In an interview with CBR, Wolfgang Petersen, director of the developer relations division for Intel EMEA, insisted that Intel has done nothing wrong.

The firm was accused of stifling competition from AMD by offering hidden rebates to customers such as Dell, HP and Acer in return for buying all, or almost all, of their chips from Intel.

“We do not agree, so we’re appealing the decision,” said Petersen. “We strongly believe in competition; we are living and working in a very competitive environment. We compete, we try to win as much as possible from the business point of view. Every company does this – if we didn’t we wouldn’t be successful.”

“We try to be a very ethical company, we try to avoid things that are unethical or non business-like. I don’t understand the argument that says Intel is pulling the end-user over the table,” he said. “We strongly believe that we can prove we are not harming the industry and that we don’t do any unethical things.”

Asked if Intel believes offering rebates was anti-competitive, Petersen said: “Rebates are absolutely normal in the industry – if you go to a company and buy 10 units, you get a certain price. If you buy 1,000 units, you get a different price – that is a rebate. It is normal in our business.”

“It is not anti-competitive, it is normal,” said Petersen. “There is zero reason why everybody can do it and we can’t. That is unfair to us. I personally believe that our competitors do exactly the same. Whenever I see a price list, there are different prices for different quantities of units. This is standard in every business.”

Petersen also rejected the claim that Intel’s actions over the last 10 years had damaged competition in the processor market: “If you look at 3 or 4 years ago, Intel lost market share because the market bought products that were better than Intel products,” he said. “The market regulates itself; people are going to buy the best products. If we have the best, we’ll gain market share. If competitors have better products, we’ll lose market share.”

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“If you don’t have competition, you stand still,” said Petersen. “Competition keeps you on your toes, keeps you developing, keeps you innovating. The market makes the decision. If you don’t have a good product, you can’t sell it.”

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