After weeks of speculation, the U.S. Federal Trade Commission is days away from filing an antitrust lawsuit against chip-giant Intel Corp., according to published reports.
As reported in yesterday's edition of the Washington Post, William J. Baer, the FTC's top litigator, has recommended to the commission that a suit be filed against Intel on the grounds that the company has used its dominant marketshare to manipulate the PC market, according to sources.
The recommendation of Baer, director of the FTC's bureau of competition, will likely ensure that the case will be brought against Intel within a week, following a vote by the remaining five members, according to sources.
At a time when Intel's competitors have been applying a full-court press and Intel itself had the misfortune of delaying the 64-bit Merced processor by as much as a year, the lawsuit does not bode well.
Wall Street is starting to take note. Though most investors shrugged off initial reports of an FTC lawsuit, when combined with the news of the Merced chip delay, Intel's stock closed at US$68 Monday, the lowest it has been this year.
The FTC's case will likely center on Intel's 85 percent marketshare and the withholding of technical information from customers and competitors. Analysts have said these practices become illegal when the company is providing an "essential facility" without which the industry could not move forward.
Intel Corp., in Santa Clara, California, can be reached at http://www.intel.com/.