IDG News Service - Wednesday's antitrust settlement between Intel and the U.S. Federal Trade Commission sends a strong message to IT companies not to exploit their dominance in a way that squashes competition or deprives consumers of choice, industry observers said.
The FTC's job is to enforce competition and protect the interests of consumers, and its case against Intel is a sign the agency intends to get more active in ensuring abuses don't occur, said Robert Lande, professor of law at the University of Baltimore School of Law.
The settlement sends the message: "If you're a monopolist, be careful," Lande said. "Just because you have a baseball bat doesn't mean you can hit people with it."
The FTC announced a broad settlement agreement Wednesday in its antitrust case against Intel. The terms prohibit the chip maker from providing benefits to PC makers in return for exclusively using its chips. That should promote competition and ensure access to a wider choice of products for computer buyers, FTC officials said during a press conference.
U.S. regulators have been paying closer attention to the computer industry since the late 1960s, when the Department of Justice filed its massive antitrust lawsuit against IBM. Nowadays, computers and technology have permeated almost every aspect of daily life, which is one reason why the FTC is scrutinizing the sector even more closely, Lande said.
The FTC's case against Intel was wide-ranging, he noted, covering graphics chips as well as CPUs, technology license agreements and even software compilers.
Jim McGregor, chief technology strategist at In-Stat, said the case was "more of a statement to the entire community ... that you need to start playing fair."
The next target in the FTC's sights could be Apple, McGregor speculated. The company appears to be unfairly restricting the options for downloading music and applications through its iPhone and iPad tablet computer, he said. Apple also prohibits developers from using some external tools like Adobe's popular Flash tools to create iPhone and iPad applications, he said.
U.S. regulators already are looking at whether Apple is shutting out third parties such as Google and Microsoft from selling ads on the iPhone and iPad, according to a recent Financial Times report. And on Monday, the Connecticut Attorney General's Office said it was looking at whether Apple and Amazon have struck anticompetitive deals with e-book publishers.
The FTC has also been keeping an eye on Google and Microsoft, which hold dominant positions in certain key technology markets. The FTC investigated Google's acquisitions of AdMob and Doubleclick, for example, ultimately clearing them both.
The Intel settlement and other enforcement actions "signal that the FTC is back in the hands of people who care about antitrust," said Charles King, principal analyst at Pund-IT.
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