As expected, the US Federal Trade Commission (FTC) announced on Wednesday that it had approved the settlement of its antitrust lawsuit against Intel.
The settlement, which was proposed last week by FTC staff on the eve of the trial (see VNU Newswire, 8 March, 1999), is a significant victory for the chip giant because the agency did not require it to acknowledge that it held monopoly power over the microprocessor market despite its 85 per cent share of the PC sector - a concession that could have been used against it in future lawsuits.
Under the terms of the settlement, which is subject to a 60 day public comment period before becoming final, Intel is prohibited from withholding or threatening to withhold advance technical information about its processors from customers unless it is for "legitimate business reasons" such as a customer filing suit against the company to prevent it from marketing its products.
It is also prevented from refusing or threatening to refuse to sell chips to a customer for reasons related to an intellectual property (IP) dispute with that customer.
But it is free to decide initially whether or not to provide information to its customers and whether to provide them with more or earlier information to further a joint venture or other legitimate business activity.
Craig Barrett, Intel?s president and chief executive, said he was pleased the lawsuit had been resolved and that Intel would now have to report to the FTC annually with regard to its compliance with the settlement.
"I am very gratified that we could come to these terms with the FTC in a cooperative spirit. Although we have different interpretations regarding Intel?s market position and the legality of our past actions, the compromise provides a framework for resolving future intellectual property disputes with our customers," he said.
The agency?s complaint against Intel, which alleged that the chip maker abused its monopoly power in the microprocessor market, was based on the principal that a monopolist company cannot withhold products or information to retaliate against customers that it is embroiled in IP disputes with.
The FTC had claimed that Intel cut off vital information to three rivals, Compaq Computer, Integraph and Digital Equipment, during legal disputes.
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