Intel President Paul Otellini Says EU is Wrong, Responds to $1.45 Billion Antitrust Fine

Intel logoEarlier today, the European Commission issued a ruling against Intel and fined it $1.45 billion USD, which it must pay into a holding account while it appeals the decision. The company held over $3.5 billion in cash and over $4 billion in short term investments at the end of the first quarter.

The fine will not affect Intel's operations and its planned 32nm transition to the Westmere family of products. "Intel will continue to invest and innovate," according to Intel spokesperson Claudine Mangano.

It is also unlikely to affect Intel's dividend yields, which is something that has been discussed heavily today since the European Commission decided to time its announcement with Intel's annual series of meetings with investors and analysts. The suspicious timing is even more curious considering that AMD filed its first complaint with the European Commission in 2000.

Intel may choose to absorb the entire fine into its second quarter or amortize it over the rest of the year. However, its plans are still in a state of flux and may change since it has only received the summary of the judgment from the European Commission and not the entire document, which exceeds 500 pages.

The world's largest semiconductor company has been fined before by South Korea for antitrust issues, and is also currently under investigation by the U.S. Department of Justice.

In response to the European Commission's announcement, Paul Otellini, the President and CEO of Intel Corporation, issued the following statements regarding the European Commission decision on Intel's business practices:

"Intel takes strong exception to this decision. We believe the decision is wrong and ignores the reality of a highly competitive microprocessor marketplace – characterized by constant innovation, improved product performance and lower prices. There has been absolutely zero harm to consumers. Intel will appeal."

"We do not believe our practices violated European law. The natural result of a competitive market with only two major suppliers is that when one company wins sales, the other does not. The Directorate General for Competition of the Commission ignored or refused to obtain significant evidence that contradicts the assertions in this decision. We believe this evidence shows that when companies perform well the market rewards them, when they don't perform the market acts accordingly."

"Intel never sells products below cost. We have however, consistently invested in innovation, in manufacturing and in developing leadership technology. The result is that we can discount our products to compete in a highly competitive marketplace, passing along to consumers everywhere the efficiencies of being the world's leading volume manufacturer of microprocessors."

"Despite our strongly held views, as we go through the appeals process we plan to work with the Commission to ensure we're in compliance with their decision. Finally, there should be no doubt whatsoever that Intel will continue to invest in the products and technologies that provide Europe and the rest of the world the industry's best performing processors at lower prices."

Source: DailyTech

Tags: AMD, Intel

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