FTC case against Intel 'weak' - analyst

A weak case is behind yesterday's decision by the FTC to an out-of-court deal with Intel, according to Erika Klauer senior analyst with BT Alex Brown.

Klauer believes the FTC's antitrust suit against Intel stood on shaky ground because, unlike the Microsoft trial, the key issue is driven by Intel's customers not its competitors.

"Intel is saying `we put time and money into this technology and have the right to use it to our advantage'" says Klauer. She added: "Intel's position would be `you're damn right we withheld it [access to information] from customers who were not willing to give license fees or negotiate cross licenses."

Klauer hinted that Microsoft should adopt Intel's position if it hopes to win against the DoJ. "Unlike Microsoft which claimed it did not have any monopoly, Intel is happy to say it did -- within its right as developers of intellectual property."

Klauer believes any plaintiff taking on a high-tech organisation is in danger of losing its advantage if market dynamics change. AMD has brought such dynamism to the microprocessor market, successfully stealing market share from Intel, particularly at the entry level.

Claiming Intel will be "more careful" to look-out for areas in which anti-trust action could be taken, Klauer doesn't predict any let-up in Intel's aggressive pricing which will compound AMD's profit shortfalls.

Intel is understandably happy with the settlement. According to a UK spokesman the company is "pleased with the terms of the agreement" believing it "provides value for Intel's intellectual property".