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#11
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Robert Redelmeier wrote:
This time some [brave?] Japanese company probably complained to MITI and produced documents that showed their discount was dependant on %Intel, not just volume Intel. Well, that's exactly what it was, on the day that they raided Intel's office, they also paid a visit to the offices of about five PC makers, NEC, Fujitsu, Sony, Toshiba, and Hitachi. Obviously to get corroborating evidence, that perhaps was missing from Intel's own offices? Yousuf Khan |
#12
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YKhan wrote:
I doubt it's just a low-level overzealousness. For example, one of the companies, NEC, was required to limit its purchases of non-Intel processors based on region of the world it was destined for: 90% within Japan, 70% to Europe, and 80% to rest of the world. It's all listed in here. How can specifying marketshares throughout the world be considered low-level, unless Intel also has marketshares throughout the Solar System? http://www.iser.osaka-u.ac.jp/semina...rai_Feb_17.pdf If true, this is extremely severe, at least under US law. Japanese law may differ. But the prez of Intel Japan either knew, or ought ot have known. And possibly the Intel CEO. I keep hearing "Intel isn't that stupid", what is that supposed to mean? They aren't that stupid as to do these sort of things at all, or that stupid as to _get caught_ doing these things? My feeling is it's the latter. I meant it as "not so stupid as to do these illegal things". No-one is smart enough to evade detection forever. -- Robert |
#13
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YKhan wrote:
Well, that's exactly what it was, on the day that they raided Intel's office, they also paid a visit to the offices of about five PC makers, NEC, Fujitsu, Sony, Toshiba, and Hitachi. Obviously to get corroborating evidence, that perhaps was missing from Intel's own offices? Corroboration is good from all sources. On something as big as this, they'd pull out all the stops. -- Robert |
#14
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On 10 Mar 2005 14:12:09 -0800, "YKhan" wrote:
I keep hearing "Intel isn't that stupid", what is that supposed to mean? They aren't that stupid as to do these sort of things at all, or that stupid as to _get caught_ doing these things? My feeling is it's the latter. A reasonable person in the business might want to be careful about making allegations that sound actionable. On the face of it, one might guess that Intel structures its discounts to make life as difficult as possible for its competitor AMD. Also on the face of it, whatever Intel may be thinking, it seems unlikely that they would structure deals in a way that make it easy to show that they are doing something illegal. Corporate values have changed over the years, with significant events leaving a lasting impression: McDonnell-Douglas being charged under RICO for bribes to foreign officials, the collapse of Enron, the collapse of WorldCom--I'm sure I've forgotten a few. Now there's Sarbanes-Oxley, so that board members can't say they didn't know. Guys with desks the size of putting greens have could stand having their every move examined by a jury of Sunday school teachers? What kind of world do you live in, Yousuf? No offense. I respect your high standards, but the world just doesn't work that way. Intel is worse than most? I doubt it. RM |
#15
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Robert Redelmeier wrote:
YKhan wrote: I doubt it's just a low-level overzealousness. For example, one of the companies, NEC, was required to limit its purchases of non-Intel processors based on region of the world it was destined for: 90% within Japan, 70% to Europe, and 80% to rest of the world. It's all listed in here. How can specifying marketshares throughout the world be considered low-level, unless Intel also has marketshares throughout the Solar System? http://www.iser.osaka-u.ac.jp/semina...rai_Feb_17.pdf If true, this is extremely severe, at least under US law. Japanese law may differ. But the prez of Intel Japan either knew, or ought ot have known. And possibly the Intel CEO. I keep hearing "Intel isn't that stupid", what is that supposed to mean? They aren't that stupid as to do these sort of things at all, or that stupid as to _get caught_ doing these things? My feeling is it's the latter. I meant it as "not so stupid as to do these illegal things". No-one is smart enough to evade detection forever. I have little doubt that Intel knew exactly what it was doing and that they planned to continue until they got caught. They simply weighed the benefits against the risk and decided it was worth it. And it looks like they were right: when they were finally caught all that happened was a finger wagged in there face while momma said "bad boy". |
#16
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Robert Myers wrote:
A reasonable person in the business might want to be careful about making allegations that sound actionable. On the face of it, one might guess that Intel structures its discounts to make life as difficult as possible for its competitor AMD. Also on the face of it, whatever Intel may be thinking, it seems unlikely that they would structure deals in a way that make it easy to show that they are doing something illegal. It's not that difficult to figure out the difference between monopolistic business practices and just standard business practices. I'm sure Intel would have you believe it's a fine line, hard to tell the difference, but it isn't. You give your customers discounts based on the _volume_ of Intel they sell, then that's standard practice. You give your customers discounts based on _percentage_ of Intel, then that's monopolistic practice. Corporate values have changed over the years, with significant events leaving a lasting impression: McDonnell-Douglas being charged under RICO for bribes to foreign officials, the collapse of Enron, the collapse of WorldCom--I'm sure I've forgotten a few. Now there's Sarbanes-Oxley, so that board members can't say they didn't know. Guys with desks the size of putting greens have could stand having their every move examined by a jury of Sunday school teachers? What kind of world do you live in, Yousuf? No offense. I respect your high standards, but the world just doesn't work that way. Play devil's advocate with somebody else, it's simply not working. Corporate values have not changed -- they've always been like this. Enron, Worldcom, etc. are just today's examples of things that have happened in the past, and will happen again in the future. The anti-trust laws were first put into place over 100 years ago, originally to control out-of-control railway barons, who were gobbling each other up and leading towards a monopoly railway (and that's also why the game of Monopoly is based around railways and land properties). Over the years, the robber barons have changed from railway magnates, to oil tycoons, to telephone companies, to full-service computer firms, to software and chip companies. But their goals have always been exactly the same -- complete domination of their own industries. Sunday school teacher morality? Not even close, just enforcement of laws that are already in place, specifically designed to stop this kind of behaviour. A sociopathic behaviour so common that the laws have already been in place for hundreds of years. Intel is worse than most? I doubt it. Who cares if Intel is worse than most or not? I don't care if it's accumulating its monopoly so that it could feed the hungry children of the world. Completely irrelevant. Think carefully about why there is no excuse for this behaviour no matter what. Yousuf Khan |
#17
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Rob Stow wrote:
I have little doubt that Intel knew exactly what it was doing and that they planned to continue until they got caught. They simply weighed the benefits against the risk and decided it was worth it. And it looks like they were right: when they were finally caught all that happened was a finger wagged in there face while momma said "bad boy". Whatever fines are levied against it, whether it is $1 or $1 million is chicken feed compared to what will come after that. Once Intel has a record as a monopolist, AMD is free to sue it and use this record as its proof. Intel will be hounded forever after. Without sounding too dramatic, make no mistake about it, this is probably *the* biggest crisis that Intel faces. It is probably its one nightmare scenario, much more important than any Prescott heat dissipation problems, fab process problems, Itanium vs. Xeon 64-bit, or any of the others. Intel's squeeky clean image will disappear if it either admits to it, or fights it in court and loses. That image has been what's kept it out of trouble so far -- none of the allegations has ever stuck to it. It's a bit like hunting for UFO's, you suspect they're there, but you just can't find the proof. After this everything will stick to Intel, which is the last thing they wanted to happen. Yousuf Khan |
#18
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Robert Redelmeier wrote:
YKhan wrote: I keep hearing "Intel isn't that stupid", what is that supposed to mean? They aren't that stupid as to do these sort of things at all, or that stupid as to _get caught_ doing these things? My feeling is it's the latter. I meant it as "not so stupid as to do these illegal things". No-one is smart enough to evade detection forever. Not doing illegal things doesn't require intelligence, it requires morality and ethics. There's no proof that Intel posesses either of those things. Yousuf Khan |
#19
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On Thu, 10 Mar 2005 21:57:13 -0500, Yousuf Khan
wrote: Robert Myers wrote: A reasonable person in the business might want to be careful about making allegations that sound actionable. On the face of it, one might guess that Intel structures its discounts to make life as difficult as possible for its competitor AMD. Also on the face of it, whatever Intel may be thinking, it seems unlikely that they would structure deals in a way that make it easy to show that they are doing something illegal. It's not that difficult to figure out the difference between monopolistic business practices and just standard business practices. I'm sure Intel would have you believe it's a fine line, hard to tell the difference, but it isn't. You give your customers discounts based on the _volume_ of Intel they sell, then that's standard practice. You give your customers discounts based on _percentage_ of Intel, then that's monopolistic practice. Right. And you know, human beings being the way they are, that the more loyal customers get the better volume discounts. Pricing can be wildly arbitrary, and some customers are treated better than others. Showing that a pricing strategy is predatory could be _very_ difficult if the pricing strategy is structured properly, even though, in fact, the strategy is aimed at rewarding loyalty at the expense of a competitor. That's just the way it goes. Maybe Intel got careless here. We'll have to see. Corporate values have changed over the years, with significant events leaving a lasting impression: McDonnell-Douglas being charged under RICO for bribes to foreign officials, the collapse of Enron, the collapse of WorldCom--I'm sure I've forgotten a few. Now there's Sarbanes-Oxley, so that board members can't say they didn't know. Guys with desks the size of putting greens have could stand having their every move examined by a jury of Sunday school teachers? What kind of world do you live in, Yousuf? No offense. I respect your high standards, but the world just doesn't work that way. Play devil's advocate with somebody else, it's simply not working. Corporate values have not changed -- they've always been like this. Enron, Worldcom, etc. are just today's examples of things that have happened in the past, and will happen again in the future. The anti-trust laws were first put into place over 100 years ago, originally to control out-of-control railway barons, who were gobbling each other up and leading towards a monopoly railway (and that's also why the game of Monopoly is based around railways and land properties). Over the years, the robber barons have changed from railway magnates, to oil tycoons, to telephone companies, to full-service computer firms, to software and chip companies. But their goals have always been exactly the same -- complete domination of their own industries. Laws are actually not all that effective, IMHO, in regulating this kind of behavior. Market discipline is much more effective. The Justice Department went after IBM for years for what really were monopolistic practices. By the time the Justice Department got anywhere close to enforcement action, one was beginning to wonder about the survival of IBM, not about market domination. As to the timelessness of what is deemed unacceptable, you're right at least that monopolistic practices have a long history of legislation and enforcement actions. What I was talking about was the timelessness of people trying to get away with whatever they can get away with. When something big happens, there is a flurry of activity, and then people go back to seeing how far they can bend the rules. In this case, the rule-bending is applied to using pricing in creative ways that cross over from creative into illegal. No amount of legislation or jawboning will ever stop such things. Sunday school teacher morality? Not even close, just enforcement of laws that are already in place, specifically designed to stop this kind of behaviour. A sociopathic behaviour so common that the laws have already been in place for hundreds of years. You don't think use of the loaded term "sociopathic" a little over the top? Intel is worse than most? I doubt it. Who cares if Intel is worse than most or not? I don't care if it's accumulating its monopoly so that it could feed the hungry children of the world. Completely irrelevant. Think carefully about why there is no excuse for this behaviour no matter what. There are laws, and there are people to enforce the laws, and they will do their thing. Sometimes events occur, like the collapse of WorldCom, that lead to meaningful action, like Sarbanes-Oxley. I suspect that Sarbanes-Oxley is going to prove sufficiently cumbersome and annoying to highly-paid directors who are unaccustomed to being encumbered with actual responsibility, that it will be duly watered down in due course. That's how hard it is to change the way business is done with legislation and enforcement. The Intel enforcement action would be interesting if it turned into something other than isolated enforcement. I'm doubting that it will. Your comments seem uncharacteristically intense. No plausible action against Intel will restore the fortunes of Sun. RM |
#20
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Robert Myers wrote:
Right. And you know, human beings being the way they are, that the more loyal customers get the better volume discounts. Pricing can be wildly arbitrary, and some customers are treated better than others. Showing that a pricing strategy is predatory could be _very_ difficult if the pricing strategy is structured properly, even though, in fact, the strategy is aimed at rewarding loyalty at the expense of a competitor. That's just the way it goes. Maybe Intel got careless here. We'll have to see. I don't think they got careless, I think that this time, their time-honoured "how to build a monopoly without getting caught" technique was not fast enough to prevent damage. I am guessing the raid on their offices a year ago caught them off-guard, as it was meant to. Otherwise they would've had time to take precautions. My guess is that the European and/or American regulators are studying the Japanese technique and getting ready to implement it themselves soon. Previous nice-guy methods have yielded no evidence, this time it did. As to the timelessness of what is deemed unacceptable, you're right at least that monopolistic practices have a long history of legislation and enforcement actions. What I was talking about was the timelessness of people trying to get away with whatever they can get away with. When something big happens, there is a flurry of activity, and then people go back to seeing how far they can bend the rules. In this case, the rule-bending is applied to using pricing in creative ways that cross over from creative into illegal. No amount of legislation or jawboning will ever stop such things. There's nothing wrong with giving discounts based on volume. Based on marketshare percentage is another matter. That sort of thing was well-known to be illegal long before this case. They are not breaking any new ground with Intel. Sunday school teacher morality? Not even close, just enforcement of laws that are already in place, specifically designed to stop this kind of behaviour. A sociopathic behaviour so common that the laws have already been in place for hundreds of years. You don't think use of the loaded term "sociopathic" a little over the top? Psychopathic is little over the top, sociopathic is right in line. Your comments seem uncharacteristically intense. No plausible action against Intel will restore the fortunes of Sun. Sun? What's Sun gotta do with it? Yousuf Khan |
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