FTC sues Intel, alleging anti-competitive behaviour

Processor giant Intel has been sued by the US Federal Trade Commission (FTC) over alleged anti-competitive business practices.

In its suit, the FTC accuses Intel of "unfair methods of competition and unfair acts or practices beginning in 1999 and continuing through today" in order to maintain a monopoly in the market for computer processors (CPUs) and " to create a monopoly" for graphics processors (GPUs).

It claims Intel "limited the sale of non-Intel CPUs" to some of the world's biggest computer makers, redesigned its compiler software to limit its performance when running on non-Intel processors, "misrepresented industry benchmarks [tests] to favor its CPUs" and "induced" companies to "eliminate or limit support for competitive CPU products".

In a statement, Intel described the case as "misguided".

"It is the normal practice of anti-trust enforcement agencies to investigate the facts before filing suit," said senior vice-president Doug Melamed. "The Commission did not do that in this case."

"The FTC's rush to file this case will cost taxpayers tens of millions of dollars to litigate issues that the FTC has not fully investigated."

The FTC's complaint also makes much of the importance of the GPU market. Although previously reserved for generating 3D graphics, these chips have recently been put to use for other tasks such as video encoding.

In one clause it notes that GPUs allow computer manufacturers "to use lower-end CPUs or fewer microprocessors for a given level of performance".

It claims that Intel competed unfairly against companies such as Nvidia, which manufactures GPU chips, by creating "several interoperability problems... that have the effect of degrading the industry-standard interconnection" between GPUs and Intel processors.

It also accuses Intel of charging "significantly higher prices" to netbook makers who were purchasing Intel Atom processors bundled with an Intel graphics chip then discarding that chip in favour of an Nvidia product.

Nvidia CEO Jen-Hsun Huang praised the FTC action, claiming that "when Intel fell behind in innovation within its core CPU market, it moved to smother competition in the GPU marketplace."

The FTC's lawsuit comes just over a month after the company paid rival AMD $1.25bn to settle numerous lawsuits and drop complaints that had amounted to a five-year legal battle.