Free-market proponents in the tech world are coming out in force against today’s European Union ruling that Intel Corp. (INTC) violated antitrust laws.
The EU contends that computer chipmaker Intel enforced predatory pricing to shut rival Advanced Micro Devices (AMD) out of the market. As a result, EU commissioners on Wednesday levied a $1.45 billion fine against Intel, as experts have been predicting this week it would.
For advocates of capitalism operating in a global market, EU commissioners couldn’t have made a worse decision.
"If you love jobs and economic growth, you have to love the companies that drive the economy and create employment demand,” said Ken Ferree, president of the Progress & Freedom Foundation, a free-market think tank. “As U.S. policymakers review the [commission’s] decision, they should think carefully before adopting a competition policy that handicaps the very companies that are the key to sustaining this country's long-term economic health. Decisions like this do nothing to illuminate the path to a vibrant and growing economy, but rather obscure it."
Wayne Crews, vice president for policy at the libertarian public policy group Competitive Enterprise Institute, agreed.
“The EU should not rejoice at this seeming triumph over American big business,” he said. “Instead, it should ponder if its policies actually make Europe hospitable for innovation.”
The best way to “sustain a competitive, knowledge-based economy,” Crews added, is to reform Europe’s regulatory regime to make it more friendly to change.
“Imposing billions of dollars of fines on the most conspicuous wealth creators is not the way to go,” Crews said.
Jonathan Zuck, president of the Association for Competitive Technology, a tech advocacy foundation based in Brussels, also is worried about the precedent the EU seems to be setting. There’s no actual consumer harm at play, he said, which means the EU is just manipulating competition in the high-tech industry.
“For the past 20 years, the microprocessor industry has delivered more innovation, more speed, more functionality, and lower prices,” Zuck said. “Over the past 10 years, the average price of Intel's PC microprocessors has dropped by 60 percent. When the only one complaining about the competitive situation is AMD, it raises serious concerns about the efficacy of this action.”
Intel, too, says the EU is wrong about the antitrust decision and says it will appeal the $1.45 billion fine.
