More sleazy dirt coming out of the court today where plaintiffs are pressing an anti-trust action against ATI and Nvidia. Yesterday, the presiding Judge, William Alsup, dismissed the defendants’ request that a particular email between two corporate executives be sealed as a “trade secret” with disgust.
Today, it looks like that email’s been presented. It’s deliciously incriminating. It comes from 2002 and was written by Nvidia senior vice president of marketing, Dan Vivoli, to ATI’s president and COO, Dave Orton.
I really think we should work harder together on the marketing front. As you and I have talked about, even though we are competitors, we have the common goal of making our category a well positioned, respected playing field. $5 and $8 stocks are a result of no respect.
Judge Alsup: “That’s not good for the defense. A jury would like to see this.” Indeed they will.
Damning email revealed in class action suit against Nvidia and AMD [Crunchgear]
Previously: Judge hammers ATI and Nvidia: “This court is not a wholly-owned subsidiary of your companies.”
Um, no. As the judge himself noted, this is certainly relevant and helps the plaintiffs, but it’s hardly prima facie proof itself of the price fixing. I believe the judge referred to it as a base hit rather than a home run.
IMNSHO but IANAL opinion, “we should work harder together on the marketing front” is really, really damning. The whole thing screams anticompetitiveness and market manipulation.
I hope this means my next card won’t cost $300…
The funniest part about this is that tons of people were willing to pay the ridiculous prices that these card makers came up with, mostly without any complaining.
#4 – Yeah maybe, but I never went above $300 and I mostly bought at the $200 range, but, we pay this and sometimes (much) more to get performance, whether it’s for Maya or or in my case, Silent Hunter 4, it’s WORTH it.
Enochrewt:
Computer equipment is so powerful and so cheap that really, I think it’s natural for people to be accepting of something costing twice what it “should” in a competitive environment, if that environment isn’t there.
There is really no relationship between value & cost in computer equipment, as is obvious by your ability to buy computing power for <$500 that would have been utterly priceless in 1950. During the same period most consumer goods increased in cost by about 8 times. (Versus at least millions, probably billions, of times for computing power.)
Um, yes. Perhaps I don’t know well enough about this sort of thing. How is this relevent to anything? What does it really mean? And…should I care as long as the video cards do their job? What they did at Enron was a sin. This is, at best…I don’t know…an insult?
It seems all pretty inconsequential to me. Even if they are found guilty of price-fixing, it’s not like the consumers (myself included) of the past 5 years are going to get any of their money back. They’ll probably pay some large fine to the government and we might see a $20 drop on the average price of future graphics cards.
Would it be possible for a class action civil suit to be made against them if they are found to be guilty? Seems pretty bunk that the victims of the price fixing no recourse.
Enochrewt:
(repost, first time around it was truncated for no reason I can see)
Computer equipment is so powerful and so cheap that really, I think it’s natural for people to be accepting of something costing twice what it “should” in a competitive environment, if that environment isn’t there.
There is really no relationship between value & cost in computer equipment, as is obvious by your ability to buy computing power for <$500 that would have been utterly priceless in 1950. During the same period most consumer goods increased in cost by about 8 times. (Versus at least millions, probably billions, of times for computing power.)
Odd. Made a comment that went nowhere. Hmm.
Anyway, I was originally very skeptical of this whole case until someone posted a few comparison slides with numbers that are…well, they really bring things into question:
http://www.techpowerup.com/img/08-07-16/a1.jpg
http://www.techpowerup.com/img/08-07-16/a2.JPG
(BTW, I love the Silent Hunter 4 reference! I assume you’ve been to SubSim.com, right? There is a forum with a ‘mods’ section, and a few mods for SH4 that really kick the graphics up a number of levels!)
“it’s hardly prima facie proof itself of the price fixing”
How fortunate then that no-one said that it did.
DDeridex, those slides are amazing. If accurate, that’s better evidentiary support even than this email.
I reloaded that pricing spread jpg a couple of times, trying to figure out why the data from the conspiracy period was missing. I even loaded it in a different browser. Then I realized the data is there, it’s just zeros. Damn.
Yeah, I was stunned myself. Literally. I had absolutely NO idea it was that…sharp…a difference.
I mean, I guess I remember buying video cards in the 3dfx days, and it sure did seem that prices were all over the place. And, yeah, it seems all video cards in the past few years came out at either exactly $99 or $299 or $499 (for ‘budget’, ‘midrange’ and ‘high end’ respectively), but…well…it’s just rather jarring to see in black-and-white.
Someone needs to dig up e-mails on ATI price fixing on Mac versions of video cards when compared to PC versions. Most vividly I remember the ATI Radeon 8500 cards selling for $225+ while PC versions of the exact same cards went for less than $75. The only difference was the boot ROM on the card, and a whole community of ATI flashers popped up to convert PC cards to Mac.
On many Mac boards—most notably XLR8YourMac—ATI reps and techs would make long winded explanations about the who/how/what/when/where/why of cost. But when you came down to it, it was price fixing to rake Mac users over the coals. AKA: The “Mac” tax.
Ditto with Apple themselves charging $200 for a SuperDrive DVD-R when they were as low as $50 a pop direct from any OEM seller selling Pioneer or SONY drives. No special ROM. No nothing. And what was disturbing in that case is initially IIRC Apple got a bulk discount deal on SuperDrives for the G4s at the time so they were cheaper than initial retail. But as the tech became more common, the retail price went down but the Apple OEM price stayed in the stratosphere.
Nowadays if you think you are paying too much, you are. And if you own a Macintosh and think that you need to pay more for some “official” part (RAM, Hard Drive, etc…) you are being ripped off.
It’s not too hard to tell these things are overinflated when a new video card costs more than some entire PCs.
I don’t see anything even approaching a smoking gun here. The fact that they colluded on increasing the profile of their industry as a whole does not amount to anti-competitive practices. That’s like saying an association of dairy farmers can’t pay for ads about how good calcium is for your bones. That’s not to say whether they did or didn’t employ active competitive practices, just that this email isn’t evidence of anti-competitve practices.
The lawyers should have never tried to hold this back from the court. Had it been handed over immediately, none of us would bat our eyes at it.
I would say there’s a difference between running an ad saying that that calcium is good for you, and agreeing that everyone in the industry should charge $X more per card. The second is legally defined as price fixing, which is illegal in the US.
It’s not so much that they colluded on increasing the profile of their industry, it’s that they colluded on increasing the profit of their industry…