EC investigates Intel's insides

The European Commission (EC) is investigating Intel for alleged abusive marketing and unfair technology licensing practices.

The EC today confirmed only that it is investigating two complaints and had asked Intel to react to allegations that it engaged in abusive marketing practices.

The chip giant has confirmed it has also supplied the Commission with information relating to its licensing agreement for bus technology. A company spokeswoman would not comment other than to say that Intel believed its business practices were "both fair and lawful".

The investigation is believed to be focusing on tactics that Intel allegedly adopted to punish PC makers that did not exclusively use its chips, while rewarding those that did. The EC is also currently asking PC makers and retailers for further information.

Intel is accused of heavy tactics that include limiting supplies of new chips, slashing subsidies related to its 'Intel Inside' marketing budget and withholding information on the bus architecture of its forthcoming chip designs.

An EC spokeswoman said: "The Commission has asked Intel to react to allegations that it abused its dominant position in the market for Windows-capable microprocessors by engaging in abusive marketing practices."

"The Commission is examining two different complaints against Intel. It is not 'taking up' previous efforts by the US Federal Trade Commission to investigate the same company, as suggested by a newspaper article. The Commission is already examining Intel's replies. It has also sent request for information to several personal computer manufacturers and retailers," she continued.

"The investigation is at a very early stage and, and the Commission has not made any finding that Intel has actually committed an infringement of European Union competition law," the spokeswoman added.

However, analysts believe that the investigation may no longer be as pressing as it was because Intel is no longer as dominant as it was in the early 1990s.

Brian Gammage, principal PC analyst at Gartner's Dataquest unit, said: "I feel that if there is a judgement here, the reality is that it will no longer be relevant to current market conditions."

"AMD is gaining ground in the market, and the user perception generated by the Intel Inside campaign that suggested that what's inside the box is the most important thing, has faded," he added.