4 ms·

Intel is being eaten alive by its competitors, including AMD. Seems overly punitive and detached from reality.

3836293648 3y ago
This is a case from 2007 that got caught up in appeal after appeal. That they've lost ground since does mean they don't deserve fines they've been delaying for ~15 years.
- gumballindie 3y ago
  Hmm isnt that usually a sign of corruption and influencing the justice system?
  - Jensson 3y ago
    The initial claim included "below cost", intel argues it didn't sell units below cost. Likely they swamped the investigation team with spreadsheets of all processes and such included in those costs and then I can see it being hard to make progress since you need to go through it to determine if they sold below cost or not. But the important part is that Intel stopped doing those things after the investigation started so that AMD could compete. If they didn't it would be very easy to prove that they are anti competitive. So even though the fines are late the effects have already been here for a long time with AMD doing well today.
    - nickjj 3y ago
      Does below cost only apply for selling certain types of 1-off physical goods? A lot of online apps tend to operate at a loss to gain a large audience and then once they've gained market share they often increase fees or more generally make it more expensive for users. Their business model forces smaller competitors out because a larger funded company can in theory hold out for a longer period of time at a loss. It's surprising this is ok but selling a piece of hardware at a loss is not ok. What about Costco selling rotisserie chickens at a loss to get people in the store or the idea of a "loss leader"?
      - Jensson 3y ago
        Not sure, but I think arguments like is why this lawsuit took so much time. For simpler goods and smaller scale "below cost" to hurt competition is very easy to prove, but when Intel did that for the entirety of Europe and their massive process it was apparently easy for Intel to hide what they did. > What about Costco selling rotisserie chickens at a loss to get people in the store or the idea of a "loss leader"? Isn't the usual argument that they got surplus stock in some way? Then it isn't below cost, it is loss minimization from a bad investment, and it doesn't hurt competition for chicken since it is a limited amount of time.
        brewdad 3y ago
        Whether you have 100 chickens or 100 million, if they cost you $6 and you sell them for $5, that's below cost. Also, it isn't limited amount of time. This has been Costco's MO for decades.
        Jensson 3y ago
        > Also, it isn't limited amount of time. This has been Costco's MO for decades. Have they sold chicken at below cost for decades with no stop? Really? I think you mean they have sold small portions of their wares at below cost, not that they have sold a specific thing at below cost for extended amounts of time. > Whether you have 100 chickens or 100 million, if they cost you $6 and you sell them for $5, that's below cost. Yeah, but the store as a whole isn't selling at below cost, and on average since those chickens aren't sold at below cost all the time they still make money from chickens. Those things means that on average the store is net positive, and them selling chickens is a net positive. Hence overall they don't sell anything at a net loss, its just for short periods of time they do it and those can be hand waved away. There are a lot of laws surrounding limited time offers that they have to follow.
- bushbaba 3y ago
  You’d think the fines would have inflation baked into it 15 years is a long time with intel stock up more than 80% over last 15 years.
  - ekeane 3y ago
    Eh? Intel stock is basically flat in that time. It was ~28 around this time in 2007 (IIRC, was my hire date), and its now 32. Intel stock is a lot of things, but 'up 80%' hasn't been something true since the early 2000s. ETA: That was 16 years ago I was thinking of, I forgot about the nasty dip in 2008. I misremembered, it was ~26 when I was hired, dipped to 18 the next year, and slowly climbed a while and has been around that $30/share number for ages.
  - blibble 3y ago
    should tie it to inflation or the percentage increase in their stock price, whichever is higher
Analemma_ 3y ago
The headline here is a bit misleading. Originally this was a $1.4 billion fine for stuff Intel did back in the 2000s, which has been reduced to $400 million after more than a decade of appeals. It seems obsolete now but Intel's transgressions at the time were very real.
- chmod775 3y ago
  Specifically these $400 million are the amount of fines that are now set in stone. The other $1000 million are still being fought over in courts.
  - mnau 3y ago
    Excellent. Intel absolutely deserves it. CPU market is duopoly, even today. $1 billion fine seems like a lot, but let's assume $100/CPU, 50% profit margin and 5 years (2002-2007). 1000_000_0000 / 100 / 2 / 5 = 1 000 000. So you would need to sell 1 million CPUs to make a $1 billion profit over 5 years. Eminently doable on EU laptop market, even back then. Definitely doesn't seem disproportionate.
    - edgyquant 3y ago
      The x86 CPU market is a duopoly you mean
      - DiabloD3 3y ago
        This is true, however, keep in mind that x86 is the 4th most produced CPU family, behind ARM, MIPS, and PowerPC, and RISC-V is coming up real damned fast to bump x86 down to 5th. All CPUs today are RISC descendants: yes, even Intel and AMD's x86. The first "not actually a CISC x86 at all internally, but 100% a RISC" was the Pentium Pro (1995, and recycled a lot of work put into the i960, thanks to Fred Pollack), and AMD's first real[1] CPUs weren't x86 but a RISC descendant called the AM29k, which when they slapped an x86 decoder on it and it became the original K5 (1996), which sometimes won benchmarks against the Pentium, especially on code that wouldn't take advantage of the Pentium dual ALU design; the AM29k/K5's OoOE was superior due to it's RISC nature. So, although, yes, technically there is a x86 duopoly, but x86 kind of ceased to exist meaningfully in the 90s. It is a RISC descendant monopoly, and whoever is in the lead at any given moment is who has the best fab tech; currently it's a fist fight between two Jim Keller architectures (he worked on both AMD's Zen and PASemi's ARM family) both using top tier TSMC tech. Jim Keller himself is a very accomplished RISC jockey, and I absolutely respect him and any team he's been part of. [1] Depending on how you define real; the team that left Intel after management screwed them and started AMD, reverse engineered and reimplemented the CPU that put Intel on the map, the 8080, called the Am9080, after making a lot of "bag of chips" sort of ICs that weren't CPUs. All the other CPUs between that and the AM29k were second source chips under license.
flangola7 3y ago
Intel absolutely tried to drown AMD in the 2000s. The fines are warranted.
- fbdab103 3y ago
  I do wonder - in a parallel universe where Intel had not played dirty - would AMD have naturally risen on top? More sales -> more revenue -> more R&D -> better products. At the very least, if AMD had been able to maintain competition for longer, would we have been stuck at 2/4 cores for so long? Still struggling to make ECC RAM mainstream?
  - mjevans 3y ago
    AMD Might have even kept their own fabs... Honestly the damages should see compounded inflation applied.
  - panick21_ 3y ago
    AMD by the end of the 2000s was beaten and broke. And by 2009 AMD was so down in the dumbs that they settled the lawsuit with Intel on arguably not favorable terms. https://en.wikipedia.org/wiki/Advanced_Micro_Devices,_Inc._v._Intel_Corp https://en.wikipedia.org/wiki/Advanced_Micro_Devices,_Inc._v.... We have to remember that Intel went all in on Itanium and it was AMD who made 64bit happen. They absolutely kicked Intels ass on performance and price for quite a while but were not able to leverage that. So yes, the future would have been quite different.
  - wmf 3y ago
    AMD has been ahead of Intel for the last five years or so but they haven't captured the market share that they likely "deserve". Path dependence and marketing really work.
  - sokoloff 3y ago
    Is ECC RAM “mainstream” even now?
kmeisthax 3y ago
AMD was nearly bankrupted by the scheme the EU is punishing. Intel kept the EU sanctions in appeals hell for a good decade and a half while they proceeded to do what every top-heavy monopolistic asshole company does: make terrible bets and destroy their own innovation. The only reason why they're floundering now is that Lisa Su resurrected AMD and built a star team of CPU designers that are kicking Intel's ass. However, that is not a reason to ignore antitrust as "outdated regulation". If anything, AMD is doing a some of the same shit Intel did when they were dominant, because that's just how the CPU market works now, itself because we let Intel set the standard of behavior a decade ago by failing to punish them for cheating. Anyway, that's why we need more overly punitive fines detached from reality.

This is a case from 2007 that got caught up in appeal after appeal. That they've lost ground since does mean they don't deserve fines they've been delaying for ~15 years.

gumballindie 3y ago
Hmm isnt that usually a sign of corruption and influencing the justice system?
- Jensson 3y ago
  The initial claim included "below cost", intel argues it didn't sell units below cost. Likely they swamped the investigation team with spreadsheets of all processes and such included in those costs and then I can see it being hard to make progress since you need to go through it to determine if they sold below cost or not. But the important part is that Intel stopped doing those things after the investigation started so that AMD could compete. If they didn't it would be very easy to prove that they are anti competitive. So even though the fines are late the effects have already been here for a long time with AMD doing well today.
  - nickjj 3y ago
    Does below cost only apply for selling certain types of 1-off physical goods? A lot of online apps tend to operate at a loss to gain a large audience and then once they've gained market share they often increase fees or more generally make it more expensive for users. Their business model forces smaller competitors out because a larger funded company can in theory hold out for a longer period of time at a loss. It's surprising this is ok but selling a piece of hardware at a loss is not ok. What about Costco selling rotisserie chickens at a loss to get people in the store or the idea of a "loss leader"?
    - Jensson 3y ago
      Not sure, but I think arguments like is why this lawsuit took so much time. For simpler goods and smaller scale "below cost" to hurt competition is very easy to prove, but when Intel did that for the entirety of Europe and their massive process it was apparently easy for Intel to hide what they did. > What about Costco selling rotisserie chickens at a loss to get people in the store or the idea of a "loss leader"? Isn't the usual argument that they got surplus stock in some way? Then it isn't below cost, it is loss minimization from a bad investment, and it doesn't hurt competition for chicken since it is a limited amount of time.
      - brewdad 3y ago
        Whether you have 100 chickens or 100 million, if they cost you $6 and you sell them for $5, that's below cost. Also, it isn't limited amount of time. This has been Costco's MO for decades.
        Jensson 3y ago
        > Also, it isn't limited amount of time. This has been Costco's MO for decades. Have they sold chicken at below cost for decades with no stop? Really? I think you mean they have sold small portions of their wares at below cost, not that they have sold a specific thing at below cost for extended amounts of time. > Whether you have 100 chickens or 100 million, if they cost you $6 and you sell them for $5, that's below cost. Yeah, but the store as a whole isn't selling at below cost, and on average since those chickens aren't sold at below cost all the time they still make money from chickens. Those things means that on average the store is net positive, and them selling chickens is a net positive. Hence overall they don't sell anything at a net loss, its just for short periods of time they do it and those can be hand waved away. There are a lot of laws surrounding limited time offers that they have to follow.
bushbaba 3y ago
You’d think the fines would have inflation baked into it 15 years is a long time with intel stock up more than 80% over last 15 years.
- ekeane 3y ago
  Eh? Intel stock is basically flat in that time. It was ~28 around this time in 2007 (IIRC, was my hire date), and its now 32. Intel stock is a lot of things, but 'up 80%' hasn't been something true since the early 2000s. ETA: That was 16 years ago I was thinking of, I forgot about the nasty dip in 2008. I misremembered, it was ~26 when I was hired, dipped to 18 the next year, and slowly climbed a while and has been around that $30/share number for ages.
- blibble 3y ago
  should tie it to inflation or the percentage increase in their stock price, whichever is higher

Analemma_ 3y ago

The headline here is a bit misleading. Originally this was a $1.4 billion fine for stuff Intel did back in the 2000s, which has been reduced to $400 million after more than a decade of appeals. It seems obsolete now but Intel's transgressions at the time were very real.

chmod775 3y ago
Specifically these $400 million are the amount of fines that are now set in stone. The other $1000 million are still being fought over in courts.
- mnau 3y ago
  Excellent. Intel absolutely deserves it. CPU market is duopoly, even today. $1 billion fine seems like a lot, but let's assume $100/CPU, 50% profit margin and 5 years (2002-2007). 1000_000_0000 / 100 / 2 / 5 = 1 000 000. So you would need to sell 1 million CPUs to make a $1 billion profit over 5 years. Eminently doable on EU laptop market, even back then. Definitely doesn't seem disproportionate.
  - edgyquant 3y ago
    The x86 CPU market is a duopoly you mean
    - DiabloD3 3y ago
      This is true, however, keep in mind that x86 is the 4th most produced CPU family, behind ARM, MIPS, and PowerPC, and RISC-V is coming up real damned fast to bump x86 down to 5th. All CPUs today are RISC descendants: yes, even Intel and AMD's x86. The first "not actually a CISC x86 at all internally, but 100% a RISC" was the Pentium Pro (1995, and recycled a lot of work put into the i960, thanks to Fred Pollack), and AMD's first real[1] CPUs weren't x86 but a RISC descendant called the AM29k, which when they slapped an x86 decoder on it and it became the original K5 (1996), which sometimes won benchmarks against the Pentium, especially on code that wouldn't take advantage of the Pentium dual ALU design; the AM29k/K5's OoOE was superior due to it's RISC nature. So, although, yes, technically there is a x86 duopoly, but x86 kind of ceased to exist meaningfully in the 90s. It is a RISC descendant monopoly, and whoever is in the lead at any given moment is who has the best fab tech; currently it's a fist fight between two Jim Keller architectures (he worked on both AMD's Zen and PASemi's ARM family) both using top tier TSMC tech. Jim Keller himself is a very accomplished RISC jockey, and I absolutely respect him and any team he's been part of. [1] Depending on how you define real; the team that left Intel after management screwed them and started AMD, reverse engineered and reimplemented the CPU that put Intel on the map, the 8080, called the Am9080, after making a lot of "bag of chips" sort of ICs that weren't CPUs. All the other CPUs between that and the AM29k were second source chips under license.

flangola7 3y ago

Intel absolutely tried to drown AMD in the 2000s. The fines are warranted.

fbdab103 3y ago
I do wonder - in a parallel universe where Intel had not played dirty - would AMD have naturally risen on top? More sales -> more revenue -> more R&D -> better products. At the very least, if AMD had been able to maintain competition for longer, would we have been stuck at 2/4 cores for so long? Still struggling to make ECC RAM mainstream?
- mjevans 3y ago
  AMD Might have even kept their own fabs... Honestly the damages should see compounded inflation applied.
- panick21_ 3y ago
  AMD by the end of the 2000s was beaten and broke. And by 2009 AMD was so down in the dumbs that they settled the lawsuit with Intel on arguably not favorable terms. https://en.wikipedia.org/wiki/Advanced_Micro_Devices,_Inc._v._Intel_Corp https://en.wikipedia.org/wiki/Advanced_Micro_Devices,_Inc._v.... We have to remember that Intel went all in on Itanium and it was AMD who made 64bit happen. They absolutely kicked Intels ass on performance and price for quite a while but were not able to leverage that. So yes, the future would have been quite different.
- wmf 3y ago
  AMD has been ahead of Intel for the last five years or so but they haven't captured the market share that they likely "deserve". Path dependence and marketing really work.
- sokoloff 3y ago
  Is ECC RAM “mainstream” even now?

kmeisthax 3y ago

AMD was nearly bankrupted by the scheme the EU is punishing. Intel kept the EU sanctions in appeals hell for a good decade and a half while they proceeded to do what every top-heavy monopolistic asshole company does: make terrible bets and destroy their own innovation. The only reason why they're floundering now is that Lisa Su resurrected AMD and built a star team of CPU designers that are kicking Intel's ass. However, that is not a reason to ignore antitrust as "outdated regulation". If anything, AMD is doing a some of the same shit Intel did when they were dominant, because that's just how the CPU market works now, itself because we let Intel set the standard of behavior a decade ago by failing to punish them for cheating. Anyway, that's why we need more overly punitive fines detached from reality.