

Will FTC's Intel Suit Hurt Silicon Valley? - alanthonyc
http://www.marketwatch.com/story/will-ftcs-intel-suit-hurt-silicon-valley-2009-12-18?reflink=MW_news_stmp

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grellas
Antitrust law is famous for enabling the government to chase after pyrrhic
victories in the name of benefiting consumers. Competitors will cheer, of
course, because they get to see the big guy hammered in a way that might
benefit them competitively and that costs them nothing.

In the microprocessor field, during the years between 2000 and 2006 (when
Intel's alleged monopolistic practices supposedly hurt consumers), the quality
and performance of microprocessors improved significantly while prices fell at
an annual rate of 48.9%. So we have anti-competitive behavior that, far from
raising costs, has lowered them in a huge way - yet, and this is key for
antitrust purposes, at no time has Intel sold below cost (which places it
squarely within two decades of Supreme Court precedent consistently rejecting
antitrust challenges to above-cost price cuts).

In this context, the FTC seeks a remedy "[r]equiring Intel to make available
technology . . . to others, via licensing or other means, upon terms and
conditions as the Commission may order."

Now _that_ will certainly spur companies to spend hundreds of millions in
fields such as this to innovate.

Will this hurt Silicon Valley? Draw your own conclusions. The cheering
competitors will say no. My guess is that just about everyone else (at least
those who are informed about the issues) will seriously question whether
having regulators throwing their weight around helps innovation or the
consumers that benefit from such innovation. But at least we can all feel
satisfied that the bully is getting its comeuppance.

