N.Y. AG in 'witch hunt' for Intel, says think tank

Washington advocacy group CEI backs chip maker in its latest antitrust battle

An advocacy group today slammed the New York attorney general's office for filing a federal antitrust lawsuit against chip giant Intel Corp.

New York Attorney General Andrew Cuomo today filed a suit alleging that Intel threatened computer makers, made payoffs and engaged in a "worldwide, systematic campaign of illegal conduct." Today's charges resemble those listed in a 2005 federal lawsuit against Intel filed by Advanced Micro Devices Inc. The 2005 suit is expected to go to trial this coming spring.

Intel quickly received some vocal support from the Competitive Enterprise Institute, a Washington-based think tank that advocates for free enterprise and limited government.

Calling New York's lawsuit a "witch hunt," the group noted in an e-mail statement that "few markets are as vibrant and innovative as the processor market."

"Mr. Cuomo's suit is just the latest example of the New York attorney general using his authority to make headlines at consumers' expense. This baseless attack against Intel will only delay innovation in the computer chip market," said Ryan Radia, associate director of Technology Studies at the Competitive Enterprise Institute, in the statement.

"During the very period that Mr. Cuomo alleges Intel was engaged in 'anti-competitive' behavior, desktop computer processors more than doubled in performance per dollar every two years. By objective measures, the performance of the processor market has been nothing short of spectacular," he added.

The New York suit isn't the only set of antitrust charges leveled at Intel -- just the latest.

Intel is facing similar charges in Korea, Europe and Japan, as well as class-action cases and the lawsuit initiated by AMD.

Radia contended that the New York attorney general is simply off base in this suit.

"Mr. Cuomo's suit rests on the fundamentally flawed assumption that Intel's high market share is indicative of market control," he argued. "In fact, Intel and arch rival AMD have been competing fiercely for over a decade, and both firms continue to invest billions of dollars each year in researching and developing faster, more-efficient chips."

Copyright © 2009 IDG Communications, Inc.

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