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Intel's Barrett: U.S. Woes Not Hurting PC Market

Intel Chairman Craig Barrett
Intel Chairman Craig Barrett
Source: Reuters
LISBON -- Intel, the world's biggest microchip producer, expects no slowdown in global demand for personal computers despite economic problems in the United States and in other countries, its chairman, Craig Barrett, said on Wednesday.

He also told reporters here in Lisbon, where he was to sign a draft deal with the Portuguese government to make 500,000 cheap portable computers for schools, that the company was upbeat on demand prospects for low-cost computers and broadband wireless systems.

"We gave a relatively upbeat business forecast, saying that despite the economic problems in the United States, our business is so international that we didn't see any slowdown in the PC market," he said. Intel (NASDAQ: INTC) posted a quarterly jump in profits during its most recent earnings report.

Barrett said a number of economies have not been seriously affected by the U.S. slowdown, providing hope that the crisis will have limited implications.

"We are seeing ... that the slowdown in the U.S. hasn't spilled everywhere else. The world's economy is not as robust as it could be, but it's not a disaster."

Apart from broadband wireless, and the next generation of low-cost computers, Intel also remains bullish about the introduction of more digital capability in health care.

"There's a huge opportunity to use it not just in the back-office but in remote diagnostics," he added.

Referring to the European Union's recent antitrust charges against Intel, Barrett said price reductions for microprocessors and computers have an "anti-inflationary nature" while prices are rising globally and also said that was a testimony to high competition in the sector.

"It looks as the market is functioning as it should, because every year consumers are getting more for less," he said. "We continue to say that -- please just look at the facts, don't just listen to a competitor complaint."

The response comes amid ongoing criticism over Intel's competitive practices, particularly as they relate to smaller rival AMD, whose market position is at the heart of the European Commission's charges.

Most recently, during AMD's (NYSE: AMD) most recent quarterly earnings call, the company's chairman, Hector Ruiz, said he would work to break "our industry from the grip of an illegal monopoly."

[cob:Special_Report]Last year, the Commission accused Intel of giving computer makers rebates to limit their use of AMD's chips or avoid them altogether.

The Commission issued additional charges against Intel earlier this month, saying the U.S. company had paid a retailer to refrain from selling computers with chips made by AMD.

Intel lawyers have previously said that that new charges filed against the company by the European Commission could lead to higher prices for consumers.

At any rate, while Intel remains flying high, its rival continues seeing still more losses. Earlier this month, AMD posted a loss of $1.189 billion on sales of $1.35 billion.

At the same time, Ruiz also announced that he would step down from the position of CEO.