"Given that Intel has harmed millions of European consumers by deliberately acting to keep competitors out of the market for over five years, the size of the fine should come as no surprise," said EU Competition Commissioner Neelie Kroes. "Intel did not compete fairly, frustrating innovation and reducing consumer welfare in the process," she said. The European Commission also told Intel to immediately cease some sales practices in Europe, though it refused to say what those were. Intel said it was "mystified" about what it was supposed to change but would comply with the "extremely ambiguous" EU order.

Intel, based in Santa Clara, Calif., has about 80 percent of the world's personal computer microprocessor market and faces just one real rival, Advanced Micro Devices Inc., which has its headquarters just three miles from Intel in Sunnyvale, Calif. The two companies have been fighting for years over what AMD claims is Intel's intimidation of computer makers into striking exclusive deals for the chips they use in their new machines. AMD claims the rebates and financial incentives that Intel offers to those companies for buying more Intel chips are designed to prevent AMD from gaining market share. AMD argues that Intel's volume discounts are sometimes so steep that AMD can't cut its own prices enough to compete without losing money on the sales.

In siding with AMD to wrap up an eight-year probe, the European Commission said Intel broke EU competition law by exploiting its dominant position, thereby limiting customer choice. The EU said Intel gave rebates to computer manufacturers Acer Inc., Dell Inc., Hewlett-Packard Co., Lenovo Group Ltd. and NEC Corp. for buying all or most of their chips from Intel and paid them to stop or delay the launch of computers based on AMD chips. (AP)