FTC proposes settlement on Intel anticompetitive case

The United States Federal Trade Commission who sued Intel in December 2009 over anticompetitive practices has now announced to settle with the chipmaker. The settlement, if approved, will come at a price for Intel

The settlement applies to CPUs, GPUs and chipsets and now restricts Intel to use anticompetitive tactics like using threats, offer bundled prices or exclude other computer makers who choose its competitor’s chips. Furthermore, the settlement says that Intel cannot mislead computer manufacturers about the performance between an Intel product and a competitive product and also give discrete GPU makers (read Nvidia) access to Intel CPU for next six years.

Under the settlement, Intel will be prohibited from:

– conditioning benefits to computer makers in exchange for their promise to buy chips from Intel exclusively or to refuse to buy chips from others; and
– retaliating against computer makers if they do business with non-Intel suppliers by withholding benefits from them.

In addition, the FTC settlement order will require Intel to:

– modify its intellectual property agreements with AMD, Nvidia, and Via so that those companies have more freedom to consider mergers or joint ventures with other companies, without the threat of being sued by Intel for patent infringement;
– offer to extend Via’s x86 licensing agreement for five years beyond the current agreement, which expires in 2013;
– maintain a key interface, known as the PCI Express Bus, for at least six years in a way that will not limit the performance of graphics processing chips. These assurances will provide incentives to manufacturers of complementary, and potentially competitive, products to Intel’s CPUs to continue to innovate; and
– disclose to software developers that Intel computer compilers discriminate between Intel chips and non-Intel chips, and that they may not register all the features of non-Intel chips. Intel also will have to reimburse all software vendors who want to recompile their software using a non-Intel compiler.

FTS says this is a tentative settlement as the order is open for public comment till September 7. Final decision will be taken after this period.

FTC

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