High Tech_s Titan Going to Court

Published: 25 February 1999 y., Thursday
When the chip giant gets its day in court defending itself against antitrust charges, it will argue that it is not a monopoly, that it didn_t bully its rivals and that it didn_t break any laws. Intel will bring its highest officers to Washington, D.C., to testify in the trial that opens March 9, including Chief Executive Officer C. Barrett and Chairman A. Grove. The Federal Trade Commission (FTC), which is bringing the suit, will trot out an array of Intel rivals to testify that the Santa Clara chipmaker is a ruthless monopolist that bullied them into surrendering patent rights. The FTC is expected to argue that Intel is a monopolist by virtue of its dominance over 80 percent of the microprocessor marketplace. Intel had revenues of $26.2 billion last year. Intel totally rejects this concept. "It is a highly competitive marketplace, and there are no monopolies,' said P. Detkin, an Intel vice president who is heading the company_s legal strategy. The FTC_s case against Intel is the second government attack on a high-tech titan. The Department of Justice is pressing a high-profile antitrust case against Microsoft Corp., whose Windows software is paired so often with Intel_s chips that the combination is known in the industry as Wintel. The Microsoft case -- which still is continuing in a federal courtroom in Washington -- has brought some of the industry_s stars to court in a nasty dispute. Intel said it has learned some lessons from how Microsoft handled itself in that case, which has been a public relations disaster for the software giant. Microsoft has taken a lot of heat for its assertion that it is not a monopoly despite making the operating system software for 90 percent of the computers sold today. Intel says its market climate is totally different than Microsoft_s. "How many of the top 10 (computer-makers) will sell you a non-Microsoft operating system? None,' said Detkin. But, he continued, "Of the top 10 (computer-makers), how many will sell you a non-Intel chip? Nine." The stakes also are different from the Microsoft case. Some legal scholars are suggesting that the government break Microsoft into two or more companies, much like prior antitrust actions against AT&T and Standard Oil. In the Intel case, the FTC is only seeking an order that says, "You can_t cut off a product to a customer, or the technical information needed to make the product work, simply because a customer has some potentially competing intellectual property it refuses to license to you.' Witnesses for the FTC, according to court documents released Friday, will include high-level executives from Compaq Computer Corp., the former Digital Equipment Corp. and Intergraph Corp. -- three companies that were in bruising legal battles with Intel. Intel has contested some of the specifics of the Intergraph charges in a civil suit Intergraph brought in federal court in Alabama. Other FTC witnesses will include executives from Intel_s chip-making competitors Advanced Micro Devices, Micron Technology Inc. and Motorola Inc.
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