Intel contends the feds don't understand chip industry

SAN JOSE, Calif. (MCT) — In formal responses to antitrust lawsuits filed by federal and New York authorities, Intel contends government investigators based their allegations on a serious misunderstanding of the microchip industry and the Santa Clara, Calif., company's internal e-mails.

Intel employs about 300 workers in Riverton and approximately 1,800 workers in its Lehi-based joint venture with Micron Technology, IM Flash Technologies. One of Intel's lawsuit responses was aimed at the U.S. Federal Trade Commission, which accused the company in a Dec. 16 suit of engaging in a campaign to discourage computer makers from using microprocessors from Sunnyvale-based Advanced Micro Devices and graphics chips from Nvidia of Santa Clara.

Although posted on the FTC's Web site Friday, Intel's document had escaped media attention until the company alerted a reporter to its existence Tuesday.

In its response, Intel contends the federal agency's lawsuit "bears little resemblance to reality" and relies on "invective to paint ordinary and desirable competitive conduct as anti-competitive exclusion."

Among its assertions, Intel says the FTC was too hasty in its investigation of the graphics chip industry and, as a result, reached erroneous conclusions about the nature of Intel's and Nvidia's businesses. Intel also criticized the FTC's demand that the company make its chip technology available to other companies "upon such terms and conditions as the commission may order."

That amounts to turning Intel into "a public utility" with the FTC taking on the role of "a central planner of the microprocessor industry," Intel's document complains.

FTC officials could not be reached for comment.

Intel on Tuesday also made public its 119-page response to a Nov. 14 antitrust lawsuit filed against it by New York Attorney General Andrew Cuomo.

Arguing that the company "has competed aggressively but lawfully," Intel repeatedly denied the lawsuit's claim that it bribed, threatened or otherwise intimidated Hewlett-Packard, Dell and other computer makers into using its microprocessors — the brains in personal computers — instead of AMD's.

Cuomo's suit had included voluminous references to confidential memos from Intel and other company executives as evidence that Intel monopolized the market. But in its response, the company said New York authorities misinterpreted those memos.Cuomo's lawsuit said Intel paid Dell hundreds of millions of dollars to exclusively use its chips and cited a 2006 e-mail from Intel CEO Paul Otellini referring to Dell as "the best friend money can buy."