NEW! Check out the Microsoft News Station for constantly updated Microsoft news, articles, and discussions all over the Internet.
ON JUNE 8, the Federal Trade Commission formally charged Intel that it used its market dominace in microprocessors to cement its position in the microprocessor market.
The complaint alleges that Intel, when faced with patent lawsuits by Digital and Intergraph, punished them by not letting them use key intellectual property vital to developing products that work with Intel products. It also says Intel punished PC maker Compaq the same way after Compaq sued a competitor that had been using Intel motherboards over Compaq patents.
From that, the case may sound very strong, but Intel feels differently. In their eyes, the FTC's filing of the complaint is an attempt to add a new legal theory to antitrust law. Intel Vice President and General Counsel F. Thomas Dunlap said:
"For years Intel has shared its intellectual property and early samples of its products with a number of key customers. These customers work with Intel to develop products for the market on a mutually beneficial basis. We believe the ultimate beneficiaries of this approach have been consumers because they get the latest technology and best products as soon as possible. At the same time, for more than 10 years, Intel has taken unprecedented steps to ensure that all of our activities and policies are in full compliance with existing law."
So, Intel believes that its actions were acceptable within existing law. And certainly, Intel should be able to protect the intellectual information it works so hard on. But can it say that's what it was doing with Digital, Intergraph and Compaq?
Strong Case or Weak Case?
The facts that Intel has submitted to the FTC aren't under dispute. When Intel got smacked by lawsuits by Digital and Intergraph last year, it retaliated by asking for confidential documents back. A judge presiding the Intergraph case has already said that the action was illegal, and ordered the documents back to Intergraph. (The Digital case was resolved out-of-court.)
And even more convincing may be the fact the Intel shared its intellectual property with other PC manufacturers and chipmakers. And, both Digital and Intergraph had been getting advance technical information through long-standing relationships with Intel.
To trustbusters, that looks like a monopoly using illegal power. But proving that Intel did any harm to innovation with their competitors and the chipmaking industry will be harder.
