EU investigators urge Commissioner to take on Intel

European Union investigators probing Intel in a competition inquiry have recommended that the company be charged, according to reports. Europe's Competition Commissioner Neelie Kroes is said to have requested more information before making a decision.

Sources close to the investigation told the Wall Street Journal that the report it has submitted to Kroes said that she must act now or drop the case altogether.

Any decision to take action against Intel will be considered carefully. The EU's antitrust action against software maker Microsoft has been going on for almost 10 years and is still the subject of disputes between the parties. Kroes may not have the appetite for a second such fight.

The investigation stems from a complaint by Intel competitor Advanced Micro Devices (AMD). AMD alleged that Intel abused its market dominating position and punished computer makers who used AMD's chips.

Though AMD's fortunes have improved significantly since it made the complaint and its market share has risen as Intel's has fallen, Intel is still the larger supplier and has been under investigation since 2001.

Investigators raided Intel offices in the UK and Germany in 2005 as part of the investigation. The dawn raids were carried out simultaneously on Intel offices and those of computer sellers.

The EU inquiry has taken over an existing German investigation into potentially anti-competitive behaviour by Intel. It had been examining claims by AMD that Intel had put pressure on retailer Media Markt to sell computers with Intel chips and not AMD ones. That investigation was subsumed into the EU case last year.

By the middle of this year Intel will have cut its workforce by 10,000 people in a cost cutting plan announced in September of last year. The slashing of 10% of the Intel workforce could be used to try to show that Intel is not profiting from any alleged anti-competitive behaviour and that AMD does not need the help of the EU in holding Intel back.

"I think this is an argument that Intel will put forward but I don't think it will make a difference," Angelo Basu, a competition law specialist at Pinsent Masons, the law firm behind OUT-LAW.COM, said last year. "It is one of those things where you are damned either way: if you have benefited it is bad and if you haven't benefited it's bad luck, but neither of these would strengthen a competition case."