EU fines optical drive cartel for colluding against Dell and HP

The European Commission has fined an eight-member cartel €116 million for colluding on tenders to supply optical drives to Dell and Hewlett-Packard.

Buyers of Dell and Hewlett-Packard PCs may have paid over the odds for their optical drives as a result of a cartel arrangement between eight component manufacturers.

The European Commission fined the eight cartel members a total of €116 million (US$132 million) for colluding between 2004 and 2008 to fix the prices of bids to supply optical drives to Dell and HP.

Philips, Lite-On and their joint venture Philips & Lite-On Digital Solutions got away scot-free for their role in revealing the cartel. Had they not turned in their co-conspirators, they would have had to pay fines totalling €64 million between them.

But the other five member, Hitachi-LG Digital Storage, Toshiba Samsung Storage Technology, Sony, Sony OptiArc and Quanta Storage, must together pay €116 million, with Hitachi-LG and Toshiba Samsung paying the largest shares.

The fines are for breaching EU antitrust rules by coordinating their behaviour on procurement tenders to supply optical disc drives to HP and Dell between June 2004 and November 2008.

The cartel members went out of their way to escape detection by EU authorities, conducting as much of their business as possible outside of Europe and in person, meeting in parking lots and cinemas. They avoided naming one another in emails, using abbreviations or codenames.

Not all the companies were involved for the full duration of the cartel, some joining for as little as one year. Sony and Philips only colluded on tenders organised by Dell.

The eight companies told one another their bidding strategies, and exchanged the responses they received to their tenders from Dell and HP as they sought to avoid aggressive competition.

"Millions of EU citizens use devices integrating optical disc drives all the time," said Commissioner Margrethe Vestager, in charge of competition policy said, adding that it is important to keep these markets competitive.

Optical drive pricing is less important now, as today's ultralight laptops often do not have them, and modern operating systems such as Windows 10 and OS X allow for installation of many apps and even entire OS upgrades direct from online app stores.

Join the PC World newsletter!

Error: Please check your email address.

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Peter Sayer

IDG News Service
Show Comments

Cool Tech

Crucial Ballistix Elite 32GB Kit (4 x 8GB) DDR4-3000 UDIMM

Learn more >

Gadgets & Things

Lexar® Professional 1000x microSDHC™/microSDXC™ UHS-II cards

Learn more >

Family Friendly

Lexar® JumpDrive® S57 USB 3.0 flash drive 

Learn more >

Stocking Stuffer

Plox Star Wars Death Star Levitating Bluetooth Speaker

Learn more >

Christmas Gift Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

GGG Evaluation Team

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Steph Mundell

LIFEBOOK UH574

The Fujitsu LifeBook UH574 allowed for great mobility without being obnoxiously heavy or clunky. Its twelve hours of battery life did not disappoint.

Andrew Mitsi

STYLISTIC Q702

The screen was particularly good. It is bright and visible from most angles, however heat is an issue, particularly around the Windows button on the front, and on the back where the battery housing is located.

Simon Harriott

STYLISTIC Q702

My first impression after unboxing the Q702 is that it is a nice looking unit. Styling is somewhat minimalist but very effective. The tablet part, once detached, has a nice weight, and no buttons or switches are located in awkward or intrusive positions.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?