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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 207.67

+2.2%

Jan 12 3:59 PM EST

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To: Saturn V who wrote (252199)	5/21/2008 2:23:27 AM
From: fastpathguru	Read Replies (1) of 275872

Saturn V (and SYH), Re: LePage's vs. 3m: Addressed in AMD's response to Intel's brief. 9th circuit recently adopted a clear test (absent from LePage's) for whether bundled rebates are exclusionary: By reallocating the entire rebate to the contested product (rather than spreading it out over both contested and uncontested products), if the resulting price of the contested products is below average variable cost, the rebates are considered exclusionary. See bolded parts of: foley.com While this too was applied to a bundle rebate, AMD says they'll show that Intel's tailored rebates are identical in effect in this case. See also: mofo.com Fourth, while the discount attribution standard by the Ninth Circuit provides clearer guidance to firms engaged in bundled discounting practices than the standards in LePage’s or Ortho, the rule also has the potential to classify more pricing behavior as anticompetitive than either the aggregate discount rule or the Ortho standard. Thus, companies with large market shares should carefully evaluate the potential antitrust risks of bundled rebates or similar discount programs in light of the Ninth Circuit’s decision. Re: Equally Efficient Competitor, Your discussion of AMD's vs. Intel's process technology, etc. indicates to me that you don't understand the Equally Efficient Competitor concept. It means that the test for exclusionary rebates/practices will be tested by pitting Intel's prices against their own cost. (i.e. that of an "equally efficient" competitor.) Again see: mofo.com While there is an ongoing debate among antitrust scholars and economists as to whether the Ninth Circuit’s “discount attribution” standard is the most “appropriate” measure of cost to use when evaluating the lawfulness of a bundled discount pricing policy, the standard does provide businesses with a clearer and more objective standard than those adopted by the courts in LePages’s and Ortho Diagnostic because it examines the pricing practices from the perspective of the defendant’s cost. fpg

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