EU's Intel ruling: Are there intangible benefits for AMD?

EU's Intel ruling: Are there intangible benefits for AMD?

Summary: AMD has been broadcasting the EU's $1.45 billion antitrust fine against Intel for nearly a week.


AMD has been broadcasting the EU's $1.45 billion antitrust fine against Intel for nearly a week. AMD is touting the EU ruling almost a week after the antitrust commission hammered Intel. 

As Brooke Crothers notes, AMD's EU chatter borders on gloating. Check out AMD's home page:

And the jump page where there are a bunch of links to the EU vs. Intel background. 

AMD's first reaction---delivered by CMO Nigel Dessau---was a bit emotional. Now AMD's move to wrap itself in the EU flag looks more calculated. What are the benefits to marketing yourself as the victor of an EU antitrust ruling that will be appealed by Intel?

The benefits are a bit murky and most analysts classify the perks as intangible at best. 

Patrick Wang, an analyst at Wedbush Securities, writes in a research note:

We maintain our neutral rating on shares of AMD but continue to warm up to the name following the favorable EU ruling and in a healthier and improved business environment. While not directly involved, we believe AMD will stand to benefit from tighter restrictions and greater scrutiny on Intel’s implied business practices. We think the EU decision could set a precedent for the three upcoming cases in March 2010 and provide leverage regarding the ongoing cross-licensing dispute. Further, we believe AMD has significantly improved its execution with its MPU and GPU product roadmaps with Istanbul / Magny-Cours and RV770, respectively. Despite this progress, we believe AMD’s earnings model remains structurally impaired.

It should also be noted that AMD won't receive any proceeds from the EU suit. 

So what are the benefits to AMD?

  • For starters, the EU lawsuit and other suits could serve as a distraction to Intel.
  • Better AMD execution and an EU victory could give it some ammo in the fear uncertainly and doubt wars.
  • AMD is getting a lot of press out of the EU ruling. 

However, there are a few negatives. 

  • Is victimhood enough to build a marketing campaign around?
  • Will an EU flag on its home page rub customers the wrong way?
  • And does AMD risk turning customers off by looking like it's gloating?

Add it up and AMD obviously sees some benefits ahead by touting its EU victory. It remains to be seen whether an antitrust victory in the EU translates to the marketplace.

Topics: Security, CXO, Enterprise Software, Government, Government UK, Intel, Processors, IT Employment

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  • depends on AMD

    If AMD now comes up with a kick-ass well-priced product, then can later say "it was Intel's fault" and they will get a very good momentum.

    If they blew it up again with another chip bug or non-performing product, they will be seen as the whiny kid.

    So you are given another chance. Show us what you've got.
    • Intel NEED the EU market.

      But hopefully Europeans will punish Intel for a few years by going AMD.
  • It might rub Americans the wrong way

    "Will an EU flag on its home page rub customers the wrong

    It might please the Europeans and AMD fans, but it might rub
    many Americans the wrong way especially if they see the fine
    as a hidden tariff.
    • Why?

      The average American (be it in business or elsewhere) usually knows little and/or cares less about what people/companies do. Besides, they are probably more worried about if they are employed next week rather than being overly concerned with Intel, AMD or the EC.

      That being said, people are used to tariffs being tossed around (increased/changed/removed), so that side of it isn't going to matter much either.

      People I think are making this out as a much bigger deal than it is. Besides, Intel must have seen the writing on the wall ages ago and I'm sure have contingencies in place. However, if this was really a surprise to them then they need to do better with their lawyers and upper management, and fast.
    • National Pride

      Any american who opposes AMD because of the EU flag on their website is not to be taken seriously. The flag is quite obviously in context of the story.

      As far as a hidden tarrif, that would suggest that the ruling is wrong and therefore this is purely to benefit the EU treasury. Again, anyone who seriously suspects this should have their opinion discounted.

      If you believe the world is that corrupt, you should stay in your house and read 'To Kill a Mockingbird' a few more times.
      • Anybody who thinks governments cannot be corrupt

        should also have their opinion discounted. I'm not going to judge whether the EC was right or wrong to fine Intel because I do not know all the facts (and I notice that in the hoopla of the fine and its enormous size that the actual facts of the case are not getting much attention). But if this were completely about fairness then there would be no reason for AMD to have to sue Intel for reparations, the EC would gladly use a portion of that enormous fine to settle that score. But I do not see one euro of that money going towards reparations, they are keeping it themselves.

        And no this is not an Anti-EU statement. My opinion has no bearing on the fact that this happens to be the EU making the decision. If the US made the same decision I'd be just as critical.
        Michael Kelly
    • If AMD has to sue Intel

      because they do not receive any reparations from that $1.45 BILLION, then how can we perceive the fine to be anything other than a hidden tariff? Certainly the cost of the investigation and trial did not cost that much. Where does the money go?
      Michael Kelly
    • They won't notice, they're too busy eating

      I expect.
    • RE, It might rub Americans the wrong way

      George, I know of at least one. I game with Intel but I was planing on my htpc being an AMD build. But now I'm not so sure.
    • But isn't AMD an American company too?

      "Advanced Micro Devices, Inc. (AMD) (NYSE: AMD) is an American multinational semiconductor company based in Sunnyvale, California..."

      Oh yeah, thought so...
  • AMD who?

    Are they still around?
    • Intel? Cheating like Microsoft.

      At least the EU isn't afraid to tackle the cancer of endless, obsessive self-interested greed.
      • So they should be investigated themselves then.

  • Wow, and AMD accuses Intel of scuzzy behavior...

    Consider me rubbed.

    The EU flag on their home page?

    They've just assured that I will never again use any product manufactured by AMD or ATI.

    Well, that's not really a true statement. I was already avoiding ATI like the plague because their graphics cards suck.
    Hallowed are the Ori
  • AMD!!! It is making itself look likes a losser

    This ruling feels political rather than justice. And putting all of that on there home page, It is making itself looks like a losser
  • While I like and use AMD, this ruling is protectionism.

    I have an AMD K6-2/450, Duron 900, and Athlon 1700+ running in my basement right now. I've been a fan of AMD for years, and have been white-boxing w/ their micro-processors for a long time.

    While I feel that Intel is over-priced, I haven't ever seen anything to lead me to believe that their behavior is criminal.

    Unfortunately, this strikes me as more of an anti-american ruling than a just one.

    Based on their recent rulings, the EU commission seems much more concerned w/ protectionism than justice.

    It's too bad, since nothing good can come from argumentation and in-fighting while the world's economy is teetering toward a global depression.

  • Intel may not be playing fair right now, but AMD lost it's market share

    because of poorly designed processors that were overclocked from the factory. This may not be the case right now, but I will not forget burning up four thunderbird processors in the same year. I finally figured out they couldn't run for long at the speed they were marked and underclocked the last one. It ran long enough to be able to replace the system with an Intel. That is why we run exclusively Intel in this house.

    A few years ago AMD chips were faster, more powerful and more stable than their Intel counterparts. Not to mention cheaper. Once AMD broke the 1GHz barrier all hell broke loose. Seemed as if every AMD chip that shipped was as clocked faster than it could handle. Many systems shipping DOA from the factory. While I am sure this isn't the case now, it is far easier to lose the publics trust than to regain it. Intel, at the time, just made a Superior product. Quality cost more.

    I don't agree with some of the tactics that Intel has used in marketing, but they are not the only one. That is the SOP throughout the entire industry.
  • Well, from a tactical POV

    They just cost their competitor 1.5 *billion* dollars. That counts as a solid punch to the gut. Pity they had to use the EU witch-hunters to do it.

    And putting the EU flag on their website, in effect declaring allegience to the EU? :)

    Well European customers will be pleased. Asian and other customers will probably shrug, and it should piss off American buyers, since AMD is (in theory) an American company.

    Guess the wisdom of that move depends on where the bulk of AMD sales are, really. :)

    So tactically a sound move. Strategically? Well, AMD has never been all that good at strategy. How many profitable quarters have they had since they've been in business?
  • RE: EU's Intel ruling: Are there intangible benefits for AMD?

    A hell of a lot of INTEL users posting on here. Poor losers art the best. You should be ashamed of yourselves.
    It's time players were on level ground and not dominated by the bigger guy
    • No shame in our game

      There are a lot of Intel users period. This is big business, nobody gives you a level playing field. You have to take it. It's not pee wee football. If AMD wants to compete,they have to make as good or better product. They used to make the better product. But they didn't keep up. Had they kept up, they would have gained market share. They don't have the money to develop products of the same caliber. They know it, and that's why they have to sell their products so cheap. So their strategy was to whine to the EU. Because they know how the EU loves to shake big company s down for money. They will gain some people and loose some people, over that maneuver. Intel plays dirty because they can. If amd had the same opportunity's They would do the same crap. AMD doesn't sell their processors cheaper because they are nicer guys and girls than Intel. They do because they know they make the inferior product. Intels best revenge would be to start unlocking multipliers. And selling them for close to the same price. AMD would probably file a lawsuit over that.