FTC Prepares to Sue Intel Over Anti-Competitive Practices

Strategic Insights -

The Federal Trade Commission (FTC) is preparing to file a significant anti-trust lawsuit against Intel Corporation, alleging that the company has abused its dominant market position in the production of microprocessor chips. The FTC claims that Intel has withheld technical information about its chips from computer manufacturers with whom it is in dispute over patents, effectively preventing them from designing new products. This move would mark a significant escalation in the ongoing "computer wars," as the FTC is already engaged in a dispute with Microsoft over similar allegations.

Key Takeaways:

  • The FTC plans to charge Intel with abusing its position as the predominant maker of microprocessor chips.
  • Intel is alleged to have withheld technical information about its chips from computer manufacturers, hindering their ability to design new products.
  • The charges against Intel are expected to be similar to those brought against Microsoft last week.
  • The FTC may file additional charges against Intel later this year, accusing the company of using predatory pricing and contract provisions to maintain its market position.
  • Intel's processors and Microsoft's operating systems control approximately 90% of the personal computer market, earning them the industry nickname "Wintel."
  • Chuck Mulloy, Intel's spokesman, stated that the company is cooperating fully with the FTC and believes it will be determined to have acted lawfully.

Statistics:

  • Approximately 90% of personal computers on the market run Intel processors and Microsoft operating systems.
  • Intel is the dominant manufacturer of microprocessor chips.
  • The FTC plans to file charges against Intel within the next two weeks.

Sources:

  • The Times, 1998