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Intel "will concentrate on market growth" after huge EU fine

"The European Competition decision (to fine Intel record €1.04B) is unlikely to make any significant change in market conditions," judges Gartner managing vice president and fellow Martin Reynolds, in a response to the decision today.

Reynolds told NewsWireless that it might yet cost Intel dear in civil suits, but in the market, he reckons things will stay the way they are - because they can't change easily: "The Intel-AMD market share is likely to remain roughly aligned with manufacturing capacity, adjusted for technology capabilities," he summarised.

The Gartner view is that Intel will pay its fine, and will "carefully inspect its sales relationships to protect against risky influence.  And Intel’s greatest challenge will remain market growth, not market share."

But, as Reynolds observes, there's no instant redress for AMD - it does not receive any money from the fine, which accrues to the EU tax budget.

In a summary statement, Gartner points out that the Competition Commission’s decision cites worldwide anticompetitive activities by Intel, specifically citing rebates structured to lock out AMD products. The record €1.04B fine "reflects the European impact of those activities; the Commission also cites deliberate cover-ups of the activity, presumably a factor in the scale of the fine."

But there's no joy for AMD in the action taken: for remediation, the Commission requires that Intel cease using loyalty rebates, because of its dominant (defined by the EU as 70 per cent or greater) market share. Because the purchase, rebates and manufacturing may have occurred in another country, this decision has global implications for Intel: "the Commission fines are substantial and encourage compliance," said Reynolds. But pain for Intel doesn't put a cent into AMD's bank account.

“However, the decision paves the way for civil cases against Intel, with the main case due to go to trial in Delaware in 2010,” Reynolds concluded.