Advanced Micro Devices - Moderated (AMD) Message Board

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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 214.18

-0.5%

Dec 31 3:59 PM EST

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To: Elmer Phud who wrote (259399)	4/3/2009 4:59:03 PM
From: fastpathguru	Read Replies (2) of 275872

Intel sells it's products at a profit and the consumer benefits as a result by those lower prices. It is my understanding that the law in the US is intended to protect the consumer and in this case the consumer has benefited greatly. Your understanding of antitrust law is lacking. Antitrust law is designed to protect the process of competition, i.e. to ensure that competitors cannot artificially tip the playing field to benefit themselves, especially important when a competitor wields monopoly power. A fundamental assumption of western capitalism is that consumers are best served by a properly operating market where the process of competition cannot be perverted by individual consumers or producers. If I understand the Law correctly (Pete please advise) it is not illegal to have a superior product at competitive prices as long as Intel does not sell at a loss. That is correct, and AMD does not accuse Intel of such simple, unsubtle abuse as straightforward predatory pricing. AMD accuses Intel of using/having used coercive loyalty rebates as their main abusive tactic. The fact that AMD has uncompetitive products at higher manufacturing costs is not Intel's fault but rather the result of bad decisions on the part of management. This is your spin and is not necessarily true. Intel pays a high price for its 1 year lead in feature size, and has a lot more overhead (i.e. 10x manpower) outside of raw manufacturing that AMD does not. I believe that Intel's margins have needed to be higher than AMD's for the same ratio of gross revenue vs. net revenue. If we are to design the Law to protect competition rather than the consumer, then there is no penalty for incompetence, in fact it is rewarded, and AMD would surely prosper. You're using "competition" when you mean "competitors." (Yes, in layman's terms, you can refer to a company's competitors as "the competition", but when discussing antitrust law, terminology must be used precisely.) Competitors are opponents in the market, competition is the market process itself. fpg

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