Samsung To Reduce DRAM Output Growth in Favor of Maintaining Prices, Says Bloomberg

[Parn]

So basically when I picked up Corsair 2x16GB DDR4 2666 from Amazon for £200 (believe it was a labelling error) last November, that was like a last sight of an extinct animal. Unless the regulators do something or some new players join the market and stir things up, the DRAM price will never come down again.

 

[bonehead123]

this is the same sh*t that opec does with OIL, so why is it such a surprise to everyone ?

and btw, due to the "capitalism 101" clause, the other mfgr's wont jack up production, simply because they LIKE/WANT/NEED the high prices to remain in effect to bolster their bottom lines, especially going into the holiday season when most (at least in the US) consumers spend way more moolah than they should on stuff they cant afford nor actually NEED.

That way they can put the ram "on sale" for ~10-15% off, to make you think you're getting a good deal, and unfortunately, 90+% of people fall for it too

 

[lanlagger]

I never tought I would say this one day, but here it is - lets hope that China with a stolen IP will save us

 

[FordGT90Concept]

What Samsung does is 100% legal and actually fairly normal. Just like with Nvidia and RTX, they've decided to sell less items for a higher price. I don't understand why people here are reacting so negatively.

Because they collectively decide to inflate the price of DRAM. The market appears to have no competition.

 

[Imsochobo]

this is the same sh*t that opec does with OIL, so why is it such a surprise to everyone ?

and btw, due to the "capitalism 101" clause, the other mfgr's wont jack up production, simply because they LIKE/WANT/NEED the high prices to remain in effect to bolster their bottom lines, especially going into the holiday season when most (at least in the US) consumers spend way more moolah than they should on stuff they cant afford nor actually NEED.

That way they can put the ram "on sale" for ~10-15% off, to make you think you're getting a good deal, and unfortunately, 90+% of people fall for it too

Opec lowered prices, other countries complain cause they can't compete at 25$ a barrel while most opec countries can happily do so with a 100% profit margin whilst many western oil nations have a 100% loss per barrel.
Quite different story, Opec is political, Dram is just companies doing their thing

 

[kastriot]

-1

 

[notb]

So, now they are just straight up openly admitting they're price fixing DRAM... :/

They're selling a product at a price they want. We call this phenomenon "capitalism". It's good.
Price fixing is when multiple (competing) companies agree to sell for some price (or prices).

Samsung has just around 50% market share.

 

[mouacyk]

Apparently, these investors do not buy RAM.

 

[Prince Valiant]

At least they aren't faking a natural disaster or plant fire .....

I find that less insulting if I'm being honest.

 

[RejZoR]

They're selling a product at a price they want. We call this phenomenon "capitalism". It's good.
Price fixing is when multiple (competing) companies agree to sell for some price (or prices).

Samsung has just around 50% market share.

Or when one deliberately retards the production in order to keep high prices and they even brag about it. How is that not "price fixing"?!

 

[Caring1]

They're selling a product at a price they want. We call this phenomenon "capitalism". It's good.
Price fixing is when multiple (competing) companies agree to sell for some price (or prices).

So by your definition, they are price fixing, one company limits production, and the other colluding manufacturers have agreed to maintain the high prices, even if they do ramp up production, in fact, they now have an excuse to raise prices further.

 

[microsista]

might aswell make them $1000 per 8gb stick, no one is going to buy memory at these prices anyway

 

[moproblems99]

I never tought I would say this one day, but here it is - lets hope that China with a stolen IP will save us

Never wish for that.

 

[notb]

Or when one deliberately retards the production in order to keep high prices and they even brag about it. How is that not "price fixing"?!

First of all: this is not how prices work :-D
Samsung limits production and keeps high prices. There's no implication in either way. They could make twice as much RAM and set even higher prices.

Second: no, this is not "price fixing". A company can make how much they want (can) and ask how much they want.
How do you know which price is "right" aka not too high or too low? Why do you think the price Samsung asks now is too high? Maybe their price is the only proper one? Maybe everyone else are dumping?

Third: Samsung has 50% market share. Other manufacturers may still sell their stuff at lower prices. Or they may follow Samsung and get higher margins.
The important fact is: that's still not "price fixing".
For this situation to be illegal, these companies would have to meet unofficially (in conspiracy) and make an agreement that they'll keep the prices high and improve margins. So to prosecute anyone, you'd need a proof of this cooperation. Just the fact that everyone suddenly sells stuff for twice as much as they used to is not enough, because this can happen in a legal way as well.

I'm accenting the "conspiracy" element, because it's vital as well. We have institutions and groups that are officially controlling volume and prices on some goods (like OPEC).
Also, most countries have limits on quantity and prices for agricultural products (and other as well).
This is not "price fixing" aka a crime. This is just fixing prices aka improving profits.

In many countries creating cartels like OPEC is illegal. This is also true for the whole EU, so, for example, no EU country would be able to join OPEC.
However, OPEC is not seen as a criminal organisation as such. OPEC's HQ is in Vienna.

might aswell make them $1000 per 8gb stick, no one is going to buy memory at these prices anyway

Wrong. Almost everyone will buy RAM at the price it's currently available for.
Sure, a gamer who builds his own rig can delay some decisions. But that's what... few % of the market?

Also, isn't Samsung still the only dependable source of RAM for AMD Ryzen owners (at least those that OC)?
In that case there is a group that won't have a choice.

So by your definition, they are price fixing, one company limits production, and the other colluding manufacturers have agreed to maintain the high prices, even if they do ramp up production, in fact, they now have an excuse to raise prices further.

No. They would have to cooperate - meet and decide for how much they'll sell. If Samsung raises prices and everyone else just follow, that is not price fixing.

 

[R0H1T]

might aswell make them $1000 per 8gb stick, no one is going to buy memory at these prices anyway

Except system builders, phone makers, OEM, ODM, HPC, servers, data centers, cloud, streaming services, govt (backed) universities etc.

 

[microsista]

all of them can keep old memory until prices drop

 

[R0H1T]

all of them can keep old memory until prices drop

No they can't, businesses (or academia) don't keep warehouses full of DRAM, just for a time like this.

 

[R-T-B]

They're selling a product at a price they want. We call this phenomenon "capitalism". It's good.

When properly regulated, it can be good. This is not a case of that.

Also, isn't Samsung still the only dependable source of RAM for AMD Ryzen owners (at least those that OC)?

Not really, no?

 

[notb]

When properly regulated, it can be good. This is not a case of that.

How would you like this regulation to be implemented? Korean government should impose a limit price for Samsung? It's the other Korea! :-D

 

[R-T-B]

How would you like this regulation to be implemented? Korean government should impose a limit price for Samsung? It's the other Korea! :-D

I would think a large near monopoly (in this case, pretty much a three company cartel) should have some price limit or some required transparency and oversight yes. That's not happening here at all.

Just because North Korea does it globally doesn't make it wrong in every single case.

 

[notb]

I would think a large near monopoly (in this case, pretty much a three company cartel) should have some price limit or some required transparency and oversight yes. That's not happening here at all.

How will you estimate the price limit? Is RAM too expensive? How do you evaluate "too expensive"?

Who will impose these regulations? Korea is the world's supplier of RAM and RAM is vital. You want Korean gov to take control over this business? Seriously?
Or maybe we'll start a global organization that's sole purpose would be to tell those few public companies headquartered in a democratic country, how they should do their business?
Screw it. Let's just bomb them and take whatever is left by force.

But then, honestly, isn't clean water more vital than RAM? So maybe we'll make a global organization that will control how everyone use water and if your favourite supplier isn't charging too much? I guess we can't bomb everyone. Or can we...?

Samsung is a public company, they publish financial statements, forecasts, plans.
They've just literally said: we want to make less RAM, but sell it for more, so that this move doesn't hurt our financial result.
CAN A COMPANY BE ANY MORE TRANSPARENT?

 

[TheOne]

What would make this illegal is if, instead of hoping Micron and SK Hynix will follow their lead, they were actually planning this together.

 

[R-T-B]

How will you estimate the price limit? Is RAM too expensive? How do you evaluate "too expensive"?

I would assume when it bucks market trends, but I am not an economy expert by any means, I just know an unhealthy state of affairs when I see it.

They've just literally said: we want to make less RAM, but sell it for more, so that this move doesn't hurt our financial result.

To which the regulators should watch closely to make sure no backdoor meetings went on with competitors (they have done this before, you know).

Samsung isn't the only guilty body here. Complacent regulators are just as bad.

What would make this illegal is if, instead of hoping Micron and SK Hynix will follow their lead, they were actually planning this together.

Yes, and given their history of doing just that, not watching them like a hawk would be a fools errand. It's also probably what's happening, sadly. But you know, that's ok! Because capitalism.

 

[yotano211]

When I bought my MB in 2015 it came with a free stick of Avexir 8GB DDR4 2133 memory, I miss those days.

Today's motherboards come with a free SATA cable.

 

[Prima.Vera]

Never wish for that.

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