Intel's EU antitrust ruling is due tomorrow

THE QUESTION du jour in the EU appears to be "Can a company be too big to be regulated?"
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It's a question that both Intel and Microsoft are praying the answer to is "Oui", but the likely reality is that Brussels will deliver a short, sharp "Non" tomorrow morning, when it is expected to rule on its antitrust inquiry into Intel's alleged anticompetitive behaviour in the European market.

If the European Commission finds Intel guilty of offering rebates and 'other inducements', that is, bribes, to OEMs in attempts to suppress competitors' market shares or freeze them out of some channels in the EU market altogether, it could fine Intel up to 10 percent of its annual revenue, which amounted to some $37.6 billion in 2008. That would be a serious punch in the gut rather than a gentle slap on the wrist for the world's dominant chipmaker.

So, what happens next if Intel wakes up to its worst nightmare tomorrow? Well, for a start, Chipzilla "will definitely appeal" according to Jim McGregor, a chief technology strategist at In-Stat. After all, he told the INQ, "lawyers have to justify their jobs."

But will an appeal even make a difference? McGregor says he's doubtful, and moreover, predicts a guilty verdict could "lead to class-action suits in Europe."

However, a long drawn out appeal process would at least delay the payment due date of any penalty that might be assessed, of course, which in itself might be reason enough for Intel to appeal given the massive amount of money that could be involved.

The INQ also posited to McGregor that the European Commission might be the least of Intel's troubles, what with the Obama administration reportedly set to take a tougher stance on antitrust complaints, even possibly by going after firms that the Bush regime left alone or actively protected during the reign of his corporatocracy.

But according to McGregor, "the US is a completely different animal," with the FTC not having taken a proper stand against big business "since they blew the case against Microsoft."

(Not wanting to argue, we didn't point out that the US Department of Justice actually won the Microsoft antitrust case under Clinton, but the Bush administration threw out Judge Jackson's proposed remedies that might have broken up Microsoft and settled the case instead, on such lenient terms that one almost wondered why it didn't also offer the company an apology for having inconvenienced it.)

"The new administration has promised to change that, but it is difficult to determine what, if anything will happen, especially to two technology leaders that are critical to the competitiveness of the US," explained McGregor.

True, but we've seen the recent grumbles from the US Department of Justice regarding companies like Google, which seems to be finding itself increasingly in the antitrust spotlight of late. So, will Google be next on the EU's list?

"There is speculation that Google could be subject to some scrutiny," said McGregor, adding that if the EU feels harm is being done to the market or consumers themselves, Google "could be next."

A guilty verdict for Intel would also "lend additional credibility" to third parties like AMD that might be looking to file civil lawsuits against the firm, said McGregor, adding, "AMD could potentially file suit in the EU for specifics, as they did in Japan."

Also, it should be noted that, although the US stayed out of the European probe, last year the FTC did start a formal investigation into Intel's sales practices within the US. So win or lose tomorrow in the EU, Chipzilla certainly will have no cause to believe it is home and dry.

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BY Sylvie Barak
Source：the INQUIRER

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