FTC Investigating Intel On Antitrust Pricing

WASHINGTON (CN) - The federal government is investigating Intel, the world's largest computer chip maker, to see if its pricing policies were intended to put a stranglehold on the $225 billion market for microprocessors in violation of antitrust laws.

The Federal Trade Commission said that Intel, its competitor Advanced Micros Devices, and several major computer makers received subpoenas this week. The investigation centers on whether Intel's pricing policies were designed to keep a stranglehold on the market for microprocessors.

The FTC's new commissioner, William Kovacic, authorized the investigation, reversing a decision by his predecessor, Deborah Majoras, The New York Times reported today. Majoras, a former senior official in the antitrust division of the Bush administration's Justice Department, resigned from the FTC this year to become general counsel at Procter & Gamble.

Advanced Micro Devices has complained for a long time that Intel is illegally monopolizing the $225 billion annual market for computer chips. AMD sued Intel in Delaware Federal Court, but the enormous amount of evidence has delayed the trial, originally scheduled for 2009, until 2010.

AMD claims that Intel, which controls more than three-fourths of the computer chip market, gives rebates and other deals that effectively result in its chips being sold at below cost.

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