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A Thought on the Charges Against Intel by the EU Commision - Page 4

post #31 of 52
Quote:
Originally Posted by Ihatethedukes View Post
People don't quite seem to understand that Intel's current price slashing has little do with competition.
I'm glad that at least a few people here seem to actually grasp the laws and economics around monopolies.

Guys - All of the sarcasm being vented here is just silly. When the market economy is chugging along as it should, then yes, competition works great and usually results in consumers getting better products at lower prices. But when one company, or a group of companies, get together to abuse a dominant position by forcing their competitors into a weakened or non-existant position, the market is no longer working. A monopolist may cut prices to the bone, even below cost, resulting in a fantastic bargain in the short term. But once the competition is gone, the market incentives to keep prices low while furthering innovation is gone. So it's bad in the long term.

If the evidence against Intel is true (and it has not yet been proven in court that it is), then Intel is guilty as hell of monopolistic practices. If not, then they'll be off scot free and AMD will seem like a bunch of whiny babies asking for government handouts. I know what I believe, but that's irrelevant...Let's all just see what happens in the courts before we go at each others' throats, hm?

And enough EU bashing. No politics allowed.
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post #32 of 52
The voice of reason
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post #33 of 52
Thread Starter 
Intel's price cuts were completely competitive. Intel was loosing market share to AMD. The price cuts were their competitive way of gaining those shares back.

You do not combat monopolies by forcing companies to raise prices. You can combat them by giving grants to the underdog or just let the market work itself out. It has a way of doing that.
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post #34 of 52
Im not saying you are wrong, but if they cut prices below cost to try and run amd into the ground then that is illegal. I agree with you that if they just lowered the price to gain back market share and are not forcing amd to cut prices so they run below cost then they didnt do anything wrong. But there is also the problems with their alleged rebates and blacklisting threats.
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post #35 of 52
All Brussels is narked about is the lower tax rate all the governmanets would be getting from cheaper components. Think about it. Cheaper components to the manufacturers means cheaper systems for consumers. Seeing as tax is often added to goods by governments at a set percentage, if the goods sell at lower and lower rates, the governments get less profit from lower tax contributions. Obviously, Intel's lower prices should in theory force its competitors to lower their prices too in order to compete, which means cheaper systems across the board, and thus less tax to the governments.

I hate the European Union, I hate it so very very much.
post #36 of 52
Thread Starter 
Quote:
Originally Posted by t4ct1c47 View Post
All Brussels is narked about is the lower tax rate all the governmanets would be getting from cheaper components. Think about it. Cheaper components to the manufacturers means cheaper systems for consumers. Seeing as tax is often added to goods by governments at a set percentage, if the goods sell at lower and lower rates, the governments get less profit from lower tax contributions. Obviously, Intel's lower prices should in theory force its competitors to lower their prices too in order to compete, which means cheaper systems across the board, and thus less tax to the governments.

I hate the European Union, I hate it so very very much.
I people pay less for their PC, they will just have more money to buy something else, which in turn is taxed.
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post #37 of 52
Quote:
Originally Posted by pauldovi View Post
I people pay less for their PC, they will just have more money to buy something else, which in turn is taxed.
Well, that's pretty much put paid to my paranoia.

Not unless they spend their money on food though, lots and lots of it.
post #38 of 52
Quote:
Originally Posted by pauldovi View Post
People provide me with one instance of a EU company being hassled by a US regulatory body. It doesn't happen, because the US doesn't run around trying to regulate companies like the EU does. The EU has attempted to limit Microsoft and Intel in the European market. I am not aware of the non-tech related companies they have targeted, but I am sure they are there.
I think your missing the point. You seem to perceive EU regulation of large companies (regardless of their home country) as "hassle", but in reality it's just the way things are done in the EU. Perhaps, if a French company went to trade in the US, they might perceive some of the regulation there as "hassle", but in reality it would just be standard regulation for the US. I think you're perceiving some kind of prejudice, or hidden anti-US agenda that, to be frank, doesn't exist. What possible benefit is there to the EU regulatory bodies, to victimise US companies? It's just not happening. The reality is, that several prominent US companies that trade in the EU, also happen to be the biggest global players in their industries too. This gives them special (but legitimate) attention (because of the EU's desire to regulate fair trade and avoid monopolies and unbalanced markets within its own jurisdiction) which then gets fed back through the US media to US citizens, along with any subjective interpretation.

Think about it. What realistic, logical reason could EU regulating bodies have to specifically target only US companies for this kind of regulation? What would be the point of deliberately creating obstacles for US companies to overcome? There isn't any realistic reason for it. These regulatory bodies are just doing their job, the same way they would for any company that dominates in it's market the way Intel and Microsoft do. Trade is just regulated differently in the EU, to the US with regards to companies that dominate the market/s they operate in. That doesn't mean there is any prejudice.

If a French, German, or UK company goes to trade in the US, it has to learn to operate in a US regulated economy, regardless of whether that means having to do, or be subject to things in the US that it would not have to do or be subject to within the markets it operates in domestically. It's the same with US companies. If they want to trade in the EU, they have to trade by the EU's terms, in the same way that an EU company would have to trade by US terms when trading in the US. I fail to see a problem here. You wouldn't like it if EU companies were allowed to flout US regulations when trading in the US, so why should it be OK for US companies to do so when trading in the EU?

Oh and yeah, the EU's GDP (purchasing power parity) is a whole 0.535% less than the US's equivalent GDP, so yeah, your right, you could say the US has a slightly bigger economy, but the EU has an approx 490 million population, whereas the US's population is around 300 million, meaning that there are about 63% more people to sell your CPUs and Operating Systems to in the EU, which in my estimation, makes it a considerably bigger market for US companies to capitalise on and a damn good reason to go into and trade in the EU. [ EU. US ]

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post #39 of 52
Quote:
Originally Posted by pauldovi View Post
Intel's price cuts were completely competitive. Intel was loosing market share to AMD. The price cuts were their competitive way of gaining those shares back.
The allegations of price cuts do not personally bother me as much as some others. Offering discounts for bulk purchases, for example, is standard operating procedure. The question I think they have to answer is whether the offered cuts were reasonable, and I don't know how to fairly guage that.

The real problematic allegation for Intel, if it proves to be true, is that they offered price incentives for companies to NOT purchase from AMD. While that may seem like semantics, it isn't. If the language of the offers, contracts, or whatever explicitly prohibited Intel's customers from considering a competing product to get the best price Intel would offer, that is anticompetitive. It is the very definition of using your market advantage to depress your rival.

Quote:
You do not combat monopolies by forcing companies to raise prices. You can combat them by giving grants to the underdog or just let the market work itself out. It has a way of doing that.
No one is suggesting (or they shouldn't have anyway) that the end result of this is to force Intel to raise their prices. The end result is that Intel would have to end its anti-competitive practices, if any are identified.
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post #40 of 52
Thread Starter 
Quote:
Originally Posted by VulcanDragon View Post
The allegations of price cuts do not personally bother me as much as some others. Offering discounts for bulk purchases, for example, is standard operating procedure. The question I think they have to answer is whether the offered cuts were reasonable, and I don't know how to fairly guage that.

The real problematic allegation for Intel, if it proves to be true, is that they offered price incentives for companies to NOT purchase from AMD. While that may seem like semantics, it isn't. If the language of the offers, contracts, or whatever explicitly prohibited Intel's customers from considering a competing product to get the best price Intel would offer, that is anticompetitive. It is the very definition of using your market advantage to depress your rival.



No one is suggesting (or they shouldn't have anyway) that the end result of this is to force Intel to raise their prices. The end result is that Intel would have to end its anti-competitive practices, if any are identified.
So it is okay for Microsoft and Playstation to have exclusive PS3 / Xbox360 licenses, but Intel cannot have exclusive Intel OEM's?
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