Friday, December 4th 2020
1 Hour Power Outage at Micron Manufacturing Plant Could Mean Increased DRAM Prices Throughout 2021
Semiconductor manufacturing is a risky business. Not only is it heavily capital-intensive, which means that even some state-backed would-be players can fail in pooling together the required resources for an industry break-in; but the entire nature of the manufacturing process is a delicate balance of materials, nearly-endless fabrication, cleanup, and QA testing. Wafer manufacturing can take months between the initial fabrication stages through to the final packaging process; and this means that power outages or material contamination can jeopardize an outrageous number of in-fabrication semiconductors.
Recent news as covered by DigiTimes place one of Micron's fabrication plants in Taiwan as being hit with a 1-hour long power outage, which can potentially affect 10% of the entire predictable DRAM supply for the coming months (a power outage affects every step of the manufacturing process). Considering the increased demand for DRAM components due to the COVID-19 pandemic and associated demand for DRAM-inside products such as PCs, DIY DRAM, laptops, and tablets, industry players are now expecting a price hike for DRAM throughout 2021 until this sudden supply constraint is dealt with. As we know, DRAM manufacturers and resellers are a fickle bunch when it comes to increasing prices in even the slightest, dream-like hint of reduced supply. It remains to be seen how much of this 10% DRAM supply is actually salvageable, but projecting from past experience, a price hike seems to be all but guaranteed.
Sources:
DigiTimes, via reddit
Recent news as covered by DigiTimes place one of Micron's fabrication plants in Taiwan as being hit with a 1-hour long power outage, which can potentially affect 10% of the entire predictable DRAM supply for the coming months (a power outage affects every step of the manufacturing process). Considering the increased demand for DRAM components due to the COVID-19 pandemic and associated demand for DRAM-inside products such as PCs, DIY DRAM, laptops, and tablets, industry players are now expecting a price hike for DRAM throughout 2021 until this sudden supply constraint is dealt with. As we know, DRAM manufacturers and resellers are a fickle bunch when it comes to increasing prices in even the slightest, dream-like hint of reduced supply. It remains to be seen how much of this 10% DRAM supply is actually salvageable, but projecting from past experience, a price hike seems to be all but guaranteed.
86 Comments on 1 Hour Power Outage at Micron Manufacturing Plant Could Mean Increased DRAM Prices Throughout 2021
We learned this, time to do it again. High DRAM price? Fine we will sit on DDR4 for another half decade, Micron.
Send the message.
It needs to not be. Tell them to eat the cost. It's the only way.
If it was planned they would just shut down the line ( production ) and restart it with nothing lost and a fantastic "oh so dramatic" news story that power was out and its affecting prices next year.
Manufacturing IC is also a pain in the Butt, the investment and equipment required typically require manufacturers to invests hundreds of millions in the fab that won’t really pay itself off unless the fab is in business for 10-15 years or sometimes more. The process to manufacture IC is also very elaborate and when the fab has one hiccup in power they will likely have to dump all in dev inventory as the quality is compromised. Point is, the fab business is a pain in the butt, shit happens and having a price increase because of a major failure event isn’t anything new.
Oops!
However....... With that said these "Reasons" for hiking prices have been occuring with regularity for a few years now and it seems during the same time of the year too.
Regardless of the reasons stated, such can only happen so often before it goes beyond coincidence, right into the realm of "It's gotta be BS".
As an example: My wife does high-level auditing in corporations. A few years ago a certain biomedical company lost more than a billion Euros after a similar power outage lasting less than two hours. Why no backup power? Well, their factory uses almost five megawatts. They would need a small power plant as a backup power source, which actually wouldn't help, as generator startup takes a lot of time and the most losses were due to cooling/refrigeration failures which are time critical. A semiconductor manufacturing plant uses way more power and is at least as vulnerable to the loss of filtration, temperature control and production progression. I can tell you from experience, if a complex production line stops, the reset time takes hours if not days, the products and half-products which were on the line have to be junked and it's generally a bad day for everyone.