WASHINGTON — After months of sparring with government antitrust lawyers, Intel Corp. is beginning to mount its public defense against charges it is a monopolist that plays hard ball on intellectual property issues.

The Federal Trade Commission will attempt to show in a hearing scheduled to begin on March 9 that Intel monopolizes the microprocessor market and has used its market power to lock in its dominance. Specifically, the government alleges that Intel denied three customers — Digital Equipment Corp., Compaq Computer Corp. and Intergraph Corp. — access to technical data needed to develop Intel-based computers.

The government is expected to seek the compulsory licensing of Intel's technology as a remedy in the antitrust case, which is expected to last two to three months.

Intel lawyers briefing reporters here this week responded that the company does not exercise monopoly control over the general-purpose microprocessor market and retains the right to decide who may have access to its technology.

"There's a lot of competition out there [in the X86 microprocessor market]," said Peter Detkin, assistant general counsel for Intel (Santa Clara, Calif.). "It's not theoretical, it's actual."

Intel's pointed to estimates by private analysts who said the company's share of the microprocessor market declined about 10 percent in 1998 as rivals Advanced Micro Devices Inc. and National Semiconductor Corp.'s Cyrix subsidiary have made gains. Besides, Detkin said, monopoly power is not measured by market share, but by the ability to set prices, control output and exclude competition.

"In the market for general purpose microprocessors, we don't set prices," Detkin said.

Another bone of contention in the case has been Intel's reluctance to license its P6 bus interface so that computer vendors could build their own core logic. Intel has since licensed its P6 bus technology to companies such as Silicon Graphics Inc. Still, Micron Electronics Inc. has so far been stymied in its attempts to develop its own core logic. Dean Klein, chief technical officer for Micron Electronics (Boise, Idaho), is a government witness in the case against Intel. Intel unsuccessfully attempted to strike Klein from the FTC's witness list.

Intel spends about $3 billion annually on research and development, company executives said, giving it the right to decide who gets access to its technology.

Intel executives are also downplaying reports that the FTC will attempt to broaden its antitrust case by distinguishing between high- and low-end microprocessors, or by raising issues like selective licensing of standard technologies. "I don't expect the case to go beyond [the FTC's] basic allegation" that Intel monopolizes the market for general-purpose microprocessors, Detkin said.

While acknowledging that issues like P6 bus licensing may be raised in the FTC hearing as an example of barriers to market entry, Intel disputed that technologies like CPU interfaces should be considered separately. "We disagree that these are separate markets," Detkin said, adding that all are part of the overall semiconductor market.

Whether the government's antitrust case against Intel fundamentally changes the way the semiconductor industry operates remains to be seen, observers said. Intel lawyers argue that even monopolists have the right to control their intellectual property, and that the FTC's proposed remedy — compulsory licensing — would effectively change U.S. patent law. That, Detkin warned, would slow the pace of innovation. Compulsory licensing means "We're going to think twice about handing out that technology," he added.

The FTC said today (Feb. 23) that pretrial briefings in the antitrust case are expected to be delivered by both sides on Thursday (Feb. 25).