AMD Hits Intel With Antitrust Suit

The No. 2 chipmaker accuses king-of-the-processor-hill Intel of coercing customers.
AMD has filed an antitrust complaint against Intel in U.S. federal district court, accusing the company of unlawfully maintaining a monopoly in the x86 microprocessor market by shunting customers away from AMD.

AMD said in a statement it has pinpointed 38 companies that have been victims of coercion by Intel, including Dell, Sony, Toshiba, Gateway and Hitachi.

The Sunnyvale, Calif.-based chipmaker argued Intel paid companies like Dell and Toshiba not to do business with AMD, and paid Sony millions for exclusivity. AMD claims its share of Sony's business went from 23 percent in 2002 to 8 percent in 2003, to zero percent today.

Intel was not immediately available to comment on the suit.

The most popular type of chip architecture for so-called volume servers, x86 microprocessors run the Microsoft Windows, Solaris and Linux families of operating systems.

''Intel's share of this market currently counts for about 80 percent of worldwide sales by unit volume and 90 percent by revenue, giving it entrenched monopoly ownership and super-dominant market power,'' AMD said in a statement.

AMD has traditionally run No. 2 to top chipmaker Intel. The company has been praised for its superior 64-bit architecture but that won't necessarily help it win back enough market share from Intel to level the playing field.

Redmonk analyst James Governor said that while antitrust regulation tends to be weak around the globe, AMD's allegations could be an interesting instrument to slow down Intel.

''If you're AMD and you're riding along on a bicycle and Intel is riding along on a motorbike and you've got a stick or a crowbar, you might as well try and throw it into the wheels,'' Governor said. ''Certainly AMD is keen to ensure that it is negotiating on a level playing field.''

On the flipside, Governor said, ''Intel will not appreciate antitrust scrutiny. Any business is going to find that a real drag. Look at the levels of bureaucracy Microsoft has had to put in place in order to comply with some of its sanctions.''

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