MESSAGE
DATE | 2006-12-01 |
FROM | Ruben Safir
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SUBJECT | Subject: [NYLXS - HANGOUT] Video Chip IP lawsuites
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From owner-hangout-at-mrbrklyn.com Fri Dec 1 17:10:42 2006 Received: from www2.mrbrklyn.com (localhost [127.0.0.1]) by www2.mrbrklyn.com (8.13.1/8.13.1/SuSE Linux 0.7) with ESMTP id kB1MAeXk020399 for ; Fri, 1 Dec 2006 17:10:42 -0500 Received: (from majordomo-at-localhost) by www2.mrbrklyn.com (8.13.1/8.13.1/Submit) id kB1MAdsM020398 for hangout-outgoings; Fri, 1 Dec 2006 17:10:39 -0500 X-Authentication-Warning: www2.mrbrklyn.com: majordomo set sender to owner-hangout-at-nylxs.com using -f Received: from www2.mrbrklyn.com (localhost [127.0.0.1]) by www2.mrbrklyn.com (8.13.1/8.13.1/SuSE Linux 0.7) with ESMTP id kB1MAbxI020393 for ; Fri, 1 Dec 2006 17:10:39 -0500 Received: (from ruben-at-localhost) by www2.mrbrklyn.com (8.13.1/8.13.1/Submit) id kB1MAbkS020392 for hangout-at-nylxs.com; Fri, 1 Dec 2006 17:10:37 -0500 Date: Fri, 1 Dec 2006 17:10:37 -0500 From: Ruben Safir To: hangout-at-mrbrklyn.com Subject: [NYLXS - HANGOUT] Video Chip IP lawsuites Message-ID: <20061201221037.GA20371-at-www2.mrbrklyn.com> Mime-Version: 1.0 Content-Type: text/plain; charset=iso-8859-1 Content-Disposition: inline Content-Transfer-Encoding: 8bit User-Agent: Mutt/1.5.6i Sender: owner-hangout-at-mrbrklyn.com Precedence: bulk X-Keywords: X-UID: 23278 Status: RO Content-Length: 4080 Lines: 96
Reuters
Print this article Close This Window U.S. starts antitrust probe into graphics chips Fri Dec 1, 2006 3:44 PM EST
By Scott Hillis
SEATTLE (Reuters) - The U.S. Department of Justice has issued subpoenas to Nvidia Corp. and Advanced Micro Devices Inc. as part of a probe into potential antitrust violations involving graphics chips, helping to send shares in the companies lower.
Nvidia, the largest independent maker of graphics chips for computers and other devices, said on Friday that no specific allegations had been made against the company and that it plans to cooperate with the investigation.
AMD, the No. 2 maker of computer processors, said late on Thursday that it had been subpoenaed. AMD entered the graphics business in October after acquiring Canadian firm ATI Technologies for $5.4 billion.
Nvidia and AMD each control about 25 percent of the market for graphics chips that are used in personal computers, mobile handsets, video game consoles and other devices, with Intel Corp. controlling the rest.
Justice Department spokeswoman Gina Talamona confirmed that it is looking into "the possibility of anti-competitive practices" involving graphics chips and cards, but declined to elaborate.
Mike Hara, Nvidia's vice president of investor relations, told Reuters that the Justice Department had asked for a broad variety of documents concerning market studies, production volumes and orders.
"They are basically asking for information. They haven't told us what they are looking for or why they are looking for it," Hara said. "The information flow is basically one-way."
Intel, which does not make separate graphics chips like Nvidia and AMD but integrates graphics functions on computer component boards it builds, said it did not believe it has been subpoenaed in the investigation.
"To my knowledge, we haven't gotten a subpoena ourselves ... but I'm not 100 percent certain," said Intel spokesman Chuck Mulloy, adding he was checking with company lawyers to confirm.
Cody Acree, an analyst with Stifel Nicolaus, said it was too early to tell what the probe would focus on.
"An antitrust action is typically some kind of pricing issue, aggressive or almost ... fixed pricing. It's hard to believe that that would be the case in graphics knowing the pricing curves that graphics goes through and the rapid swings in market share," Acree said.
"This has been such a volatile area where ATI and Nvidia swapped market share back and forth," Acree said.
The subpoenas spooked investors, with Nvidia shares falling $1.68, or 4.5 percent, to $35.31 in busy Nasdaq trade. AMD shares fell $1.13, or 5.2 percent, to $20.45 on the New York Stock Exchange. Intel shares fell 2.8 percent to $20.80 on the Nasdaq.
Other analysts also said the shares were likely being hit from fresh concerns that PC demand during the crucial year-end holiday shopping season was shaping up to be weaker than expected.
(Additional reporting by Peter Kaplan in Washington and Jim Finkle in Boston)
© Reuters 2006. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.
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