Intel paid billions in secret rebates to PC manufacturers to exclude AMD chips, paying $1.25 billion to settle

When you bought a laptop or desktop computer in the early 2000s, your choice of processor felt limited. Intel dominated the market with near-total control, while AMD struggled for shelf space. What consumers didn't know was that this wasn't the natural outcome of competition—it was engineered through billions of dollars in secret payments designed to keep rival chips off store shelves.

For years, AMD suspected Intel was playing dirty. The company alleged that Intel had systematically paid PC manufacturers—particularly Japanese firms like Fujitsu, NEC, and others—to exclude or severely limit AMD processors from their product lines. These weren't transparent negotiations. Intel structured payments as "rebates" conditional on maintaining certain market share targets heavily skewed toward Intel, creating a financial penalty for manufacturers who dared to sell too many AMD chips.

Intel's official position was straightforward denial. The company maintained it competed fairly and that its market dominance reflected genuine technological superiority and customer preference. When questions arose, Intel's public response emphasized that rebate programs were standard industry practice and that no anticompetitive intent existed. The company's executives weren't particularly worried—they had the market, the profits, and the narrative.

The evidence that finally proved otherwise came through the discovery process in litigation initiated by AMD. New York Attorney General Andrew Cuomo's office accessed 200 million documents and took 2,200 hours of depositions from Intel employees and executives. What emerged was damning: internal Intel emails showed executives were explicitly warned against creating documents that referenced market share "targets" for customers. That kind of instruction—telling your legal team to avoid certain paper trails—doesn't suggest confidence in your conduct.

The documents revealed the scope of the scheme. Intel had negotiated rebate arrangements that made it financially irrational for manufacturers to purchase AMD processors. The payments were calibrated specifically to undercut AMD's ability to gain market share. This wasn't a single incident or an overzealous sales division. This was systematic, deliberate, and orchestrated at executive levels.