Dell’s Relationship With Intel

Andrew Orlowski, on the bizarre financial scheme between Intel and Dell:

Intel’s rebates amounted to 38 per cent of Dell’s operating profit in the fiscal year 2006, and rose to 76 per cent (or $720m) in one quarter alone, Q1 2007. While almost all of the Intel funds were incorporated into Dell’s component costs, Dell did not disclose the existence, much less the magnitude, of the Intel exclusivity payments.

Effectively, Intel bribed Dell not to use chips from AMD, and, eventually, Dell grew financially dependent upon those bribes.

★ Friday, 27 August 2010