SWEET DEALS -- OR STRONG-ARM TACTICS?

For years, Advanced Micro Devices Inc. has tried to go after its giant rival, Intel Corp., accusing it of illegally using its monopoly power. The root of its allegation is that Intel uses exclusionary practices--rebates, discounts, and marketing dollars--to strong-arm customers into buying its chips, shutting AMD out. In recent years courts have ruled that exclusionary behavior by large companies against smaller ones is illegal because it hurts competition in the overall market. AMD alleges that Intel crosses the line by offering these inducements only if a customer agrees to buy most of its chips from Intel. Such exclusionary contractual practices, AMD claims, have the effect of shutting it out. AMD alleges that Intel's exclusionary arrangements with customers violate antitrust law, a charge Intel denies. To win, AMD must show three things: 1.Intel dominates the market, with a 60% or higher share. 2. The exclusive dealing prevented AMD from entering a market. 4. There is no valid business justification for the conduct, such as lowering prices for consumers.