500% in a year is just insane. I knew RAM prices were going up, but $3k+ for 128GB of DDR5 makes me wonder how much of this is actually AI demand, and how much is this just manufacturers taking advantage of it. They have done this in the past after all
I don't understand the distinction you are making. If you have a massive excess of demand ready to pay any price, and a limited supply, of course the sellers will take advantage, that's how any market works. They can do that because of the lack of supply.
Over the long term demand will rationalise and supply will adjust. But in between there is a squeeze, and the right price is the maximum price buyers are willing to bid for the limited supply. Sucks for other buyers, on the other hand it ensures demand destruction, i.e. that the limited supply goes to the buyer who need it the most, other buyers will delay their purchase and do with what they have.
> If you have a massive excess of demand ready to pay any price, and a limited supply, of course the sellers will take advantage, that's how any market work
The question is how quickly the supply adjusts. In a free market, the suppliers would respond to the price signal by quickly expanding their production to meet the elevated demand.
But a market captured by a cartel will be much slower to expand the supply.
So, the test isn't "how much is price going up" it's "how aggressively are the RAM producers expanding supply production"
Memory fab build out times are years not months. The existing ones already run 24/7. If these companies could pull more supply out of thin air they would, but they cannot.
Would they?
Cartels aren't known for massively increasing production to satisfy all demand. Far from it I'd say, they're more likely to expand supply to such a level that they can still reap massive profits. Very few countries/companies have the knowhow and willingness to be able to build more.
OPEC is a perfect example of this behaviour. They set hearly production goals to keep prices high. Or the Quebec Maple Syrup Producers organization that limits the amount of syrup a farmer can produce and sell in a year to keep prices high.
> Quebec Maple Syrup Producers organization
Can you just not join the organization?
Maple trees are living things and have a right to reproduce, you can't fault a bird for shitting maple seeds all over my farm planting maple trees everywhere.
It looks like you're forced to participate by law once you sell over a certain volume.
> Backed by the Canadian civil courts, the federation has the monopoly for selling Quebecois maple syrup on the wholesale market, and for exporting it outside the province. Producers are only allowed to sell independently cans of less than five litres or 5kg to visitors to their farm. https://www.bbc.com/news/business-35028380
I saw a documentary(forgot the name, sorry) about that that said, no you can't choose not to join. I forgot if it was about this organization but it was about maple production in Canada where a farmer wanted to do their own thing and they were intimidated and all sorts of nasty things happen to them because they didn't think the org was just and wanted to sell freely. Very interesting documentary and an eye opener that even farmer unions can act like organized crime when there's money involved.
> you can't fault a bird for shitting maple seeds all over my farm planting maple trees everywhere.
If only building a ram FAB was that easy :).
The best hope is that cxmt gets going quicker than expected and is able to satisfy a decent chunk of the Chinese demand for RAM which would - in theory - reduce the demand for ram from the few other producers.
You're correct in theory. I'm just not sure we have a cartel situation. Micron is a US company, and it controls 25% of the global market. I see no evidence that they nor SK hynix nor Samsung are intentionally limiting production.
I do see people arguing, "they had years to increase production - why didn't they?" They've been remarkably candid about this: because RAM production has been losing them money in the past. Because they don't have a cartel, prices were on the floor. Investing in more production would have been corporate suicide.
Even now, there is considerable risk that the bubble will burst, and all this investment in new production will be flushed down the toilet. RAM production is a brutal business.
> OPEC is a perfect example of this behaviour.
It really is. First thing I searched for in the thread.
OPEC's aim isn't to keep prices as high as possible. If they go too high, people will start buying electric cars, investing in renewable energy, etc. Basically they want to make oil as expensive as possible while preventing it from getting so expensive that it's disruptive.
OPEC's goal is as much profit as possible. They're not thinking in the short term but long term. If as much possible means over the span of multiple centuries then that's what they're going for.
I think we're in agreement here. I don't think memory manufacturers are interested in a market disruption even though profits are incredibly high for a few years. Make it too profitable for too long and others will arise but keep the supply at a steady pace with decent margins and they will remain the only ones on the block because of massive upfront cost.
China is, to my knowledge, the only country that has so far had the willingness to seriously invest. Not necessarily for profits but for independence reasons. I don't see many (or any really) other countries following suit.
Can you list out the precise "cartel" company, their supply chains and the board of directors, their financial and political ties?
Lot of unsubstantiated claims with low fidelity meme evidence
There's details in the class action lawsuit
https://stream-ai.s3.us-west-1.amazonaws.com/class-action-co...
https://en.wikipedia.org/wiki/DRAM_industry_price_fixing
> Cartels aren't known for massively increasing production to satisfy all demand.
Don't worry they will leave money on the table and lobby for protectionism when china comes and eats their lunch.
But are the memory chip producers acting like a cartel? In the past they have not. When there was a shortage, they increased production as rapidly as they could build the new fabs, crashing the price of memory.
As others have noted they've been found colluding previously, more than once. Even admitted guilt and some people went to jail over it.
And the reason the market is so small is because of players who did as you propose, the DRAM market crashed on them (not due to them but due to broader market dynamics), and they went out of business.
So there is, quite perversely, strong incentive to collude if possible and if not to abide by an unstated agreement to be extremely slow to expand DRAM capacity.
That said...
SK Hynix has two fabs under construction, one set to open later this year. One for 80k wpm, another 360k wpm. A third was recently approved to start construction.
Micro has an overhaul of Fab 6 in Virgina near done and slated to produce first wafers this year. It also has a large expansion in Boise nearly completion for 300k wpm. They're also building a "megafab" site in New York (my guess is >1m wpm) and expanding at their Japanese plants (40k wpm).
Samsung has two under construction, P4 for 100k wpm.
Nanya - historically a secondary player focused only on producing non-leading-edge DRAM is making a play for the leading-edge market with a new fab dedicated to DDR5 and HBM.
It appears they've all decided that the demand is sufficiently sustained that building new fabs is worth doing... but it takes time. If my guess is right Micron is making the largest play with their New York site at 1-1.5m wafers per month. That would give them a large chunk of the market.
(wpm = wafers per month)
>In the past they have not.
Well guess what :) They've done it before, they will do it again.
"To date, five manufacturers have pleaded guilty to their involvement in an international price-fixing conspiracy between July 1, 1998, and June 15, 2002, including Hynix, Infineon, Micron Technology, Samsung, and Elpida.[1]"
[1]https://en.wikipedia.org/wiki/DRAM_industry_price_fixing
Wasn't that bad for business last time? I could see them erring on slower build up because of how it went before, if they're not sure how long this demand will last especially
Which is exactly what's happening. There used to be a lot more then 3 makers but up till very recently memory was a comedically low margin business you didn't go into.
There are several Chinese fabs that they could contract out production to. In fact that's exactly what Apple tried to do, before the U.S. government went full protectionist and added the two memory manufacturers to the banned imports list. There's also the Texas Instruments fab that's underutilized right now. The extra capacity exists, it's just Micro and SK Hynix are throwing their money around to stifle anything that could jeopardize their spike in profits that are historic not only for their industry, but for manufacturing as a whole.
I didn't say the build out time was months.
I said:
> the test isn't "how much is price going up" it's "how aggressively are the RAM producers expanding supply production"
Large barriers to entry are anathema to competitive markets, so the conclusion here is still that firms are benefitting from the lack of a competitive market.
Memory fabs take years to build, they cost a lot and there is no guarantee that the demand will stay as high years in the future. It's all very complex.
And yet, memory manufacturers have been caught (in legal cases and fined) many times to collide and keep prices high artificially in the past.
I'm curious what the limiting factor is for "years not months" when building these fabs. DRAM is a commodity, there are only threeish major manufacturers, all have huge amounts of capital, multiple nations bend over backwards for new semiconductor production projects, and there seems to be unlimited money going into purchasing these things.
Even when it comes to manufacturing the tooling/testing infrastructure, it's just a question of money aiui.
It's not "just a question of money", time is absolutely a factor. Getting nine women pregnant doesn't give you a baby in a month.
> But a market captured by a cartel will be much slower to expand the supply.
Oh yea, governments can fix by putting 100 billion in memory fabs right now, and when demand crater in decade or so, let tax payer eat the cost of those fabs. At least it will benefit poor computer users like me.
Free Market doesn’t mean new ram production can “just be stood up”
And given that these are independent actors in the free market, they’ve seen the history of boom/bust cycles in this market
Free market doesn’t mean “everything just magically happens”
As has already been pointed out further down, OPEC is the perfect example of this. Things don't really work that way when the time scales are so extended. What we need is fracking, but silicon.
This system is too complex, the few individual players too big, with too many artificial distortions for the adjustment to equalize out in a way that's anything but years-long (it may have shock-waves that extend past the decade), and highly destructive to everyone who isn't OPEC, or their largest customers, in this analogy.
The brunt of it will be paid by the people further down the food chain.
> In a free market, the suppliers would respond to the price signal by quickly expanding their production to meet the elevated demand.
That’s a good one!
> In a free market, the suppliers would respond to the price signal by quickly expanding their production to meet the elevated demand.
Why would they?
And you claim to have historic examples where they did?
Generally speaking, if demand stays high, and existing suppliers don't increase supply, the high prices create an incentive and opportunity for new market entrants to increase the supply.
Yes everyone took Econ 101.
Now what do you think happens when developing new supply is substantially constrained by lead times?
Coz a whole lot less of you have ever dealt with manufacturing logistics.
Prices go up, until new supply comes online or demand wanes. Econ 101 is not invalidated just because you are having to go without due to high prices.
Some supply and demand curves move in days, some in months, some on years.
Yes that would be my exact point.
Even if the memory market was completely competitive the time it takes to expand supply is measured in years. There was no way for them to serve the AI demand without reducing supply given to everyone else in the short run
> There was no way for them to serve the AI demand without reducing supply given to everyone else in the short run
I didn't say that there was a way to do it in the short run. I laid out what the test is to determine if there's cartel-like behavior or competitive-market-like behavior.
I will say, in a market with only 3 players and very high cap-ex cost, my prior is that you're likely to see more cartel-like behavior than competitive-market-like behavior, but that's still to be determined.
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> I don't understand the distinction you are making.
20 years ago: https://en.wikipedia.org/wiki/DRAM_industry_price_fixing
> According to the one-count charge filed in San Francisco's federal court on Thursday, Park conspired with unnamed employees from other memory makers to fix the price of DRAM sold to computer makers from April 1, 2001, to June 15, 2002. The government says the move directly affected sales to U.S. computer makers Dell, Hewlett-Packard, Compaq, IBM, Apple Computer, and Gateway.
etc
>that the limited supply goes to the buyer who need it the most
Everything else you said is accurate, but this is not. Supply will go to those most able to pay, not those who need it the most. It is not a moral allocation, which your language implies.
Nobody really "needs" RAM immediately though, like a heart or a lung or something.
That’s a bold statement to make in the 21st century when nearly everything is run on computers, including cars, planes, hospital networks, etc etc.
Not really. They can get RAM just fine, and delay upgrade/refresh cycles to stretch existing component lifecycle, which was already very long if they needed to.
What if it’s for the machines that support this surgery?
Someone please put RAM into Maslow's hierarchy of needs
"that the limited supply goes to the buyer who need it the most" - I would say that the limited supply goes to the buyer who can afford to pay higher than others. Someone may need the memory more, but may not have the deeper pockets to pay for it like NVidia and Apple might.
I would have framed it as "buyer who can get the most leverage from it", which equates to being able to spend more. It's an economic argument, not a values argument.
You suppose what you'll do with the ram has an incidence on your capacity to buy it which is only true if you are part of those able to get financing.
Gamers may need the memory more, but AI labs can use the memory more productively
Profitably-for-the-fabs*
"limited supply goes to the buyer who need it the most"
No? It goes to the buyer with the deepest pockets.
it is probable that you don't get the deepest pockets by wasting money. anyone that pays so much for memory means they expect to get even bigger value from that.
"It is probable"
So RAM manufacturers will turn down company B's $2M offer for company A's $1M offer because company A "needed it more"?
I'm actually done discussing this...
My comment is about B offering 2M when normally the price of that RAM was around 1M. Most probably B has a way to get > 2M value from that RAM.
> I don't understand the distinction you are making.
It's pretty simple. In a correctly regulated market the sellers are in competition with each other so there is a limit to how much they can increase prices, since they'll just lose business to their competitor.
In a poorly regulated market that allows competitors to collude with each other to raise prices by the same amount, they'll inflate prices much further.
Real history here on this subject is the LCD panel price fixing scheme: https://en.wikipedia.org/wiki/TFT-LCD_(Flat_Panel)_Antitrust...
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>I don't understand the distinction you are making. If you have a massive excess of demand ready to pay any price, and a limited supply, of course the sellers will take advantage, that's how any market works. They can do that because of the lack of supply.
The question is how much of this demand is actually based on AI, or just an excuse to fleece regular buyers (and AI is not really the actual demand driving such prices).
Memory manufacturers have driven up prices via collusion many times in the past (and paid fines for it), without AI or some similar high demand vertical market existing.
But I don't think it's the case now, see my answer elsewhere here for why.
> or just an excuse to fleece regular buyers
In a market with healthy competition (no collusion), this generally can't happen. Every single vendor is incentivized to lower their prices slightly at all times, with a floor at cost plus margin.
>In a market with healthy competition (no collusion), this generally can't happen.
We're talking about the memory market here.
The "healthy competition (no collusion). Every single vendor is incentivized to lower their prices slightly at all times, with a floor at cost plus margin" is the fairy-tale version they teach at 101s.
why plus margin? the floor is cost
They fixed prices in the past and now they have an easy cover, like egg producers had with eggs after the cull a few years ago
I'm sure there will be no large scale leverage campaign against a country who is enabling profiteering at this level. No defense agreements removed, troops removed from the country, or large tariff increases around failed investments.
I'm sure it will only suck for the buyers. This has no effect on inflation and probably will be overlooked by the current admin.
Byron the bulb checking in.
The distinction is that on the latter case you have a cartel that decided to fix prices and fuck everyone in the ass.
Google: Cartel
What is cartelization for 500%, Alex.
I'm not sure how turning into crabs is going to help us download more RAM.
In an absolutely free market? sure. But we don't live in an absolutely free market, the memory manufacturers have refused to budge on creating new fabs until recently out of caution and to be able to create a demand excess.
They have slow rolled rollouts and everything, if there wasn't CXMT they would probably still wouldn't have budged on building new fabs for a while longer.
You can absolutely price fix/manufacture a shortage. Ever heard of merchants setting fire to crops after hoarding to sell at a higher price?
The issue is the distributer and producer are the very same people this essentially means producers have no incentive to rationalize supply, they can make much more money of the long drawn out shortage.
I think everyone is aware now that you don't build a fab by snapping your fingers, and you need to amortise it over many years. The said manufacturers are just out of a massive slump in demand during covid, when they were selling at a loss, and these cycles happened many times in this industry. It is understandable that they don't jump all-in on the AI bandwagon, which, god knows where it is going and for how long.
If you want evidence that no one predicted this, look at WD. They disinvested from sandisk up to early this year. Now sandisk is worth more than WD. Doesn't seem consistent with a concerted strategy to gauge prices.
> You can absolutely price fix/manufacture a shortage. Ever heard of merchants setting fire to crops after hoarding to sell at a higher price?
Fine. Show me which manufacturer is cutting production to corner the market. I don't see that.
Yes when there are large fixed costs to expanding production, that will happen more slowly, after determining that the high demand isn't just a short term spike.
It's not like wheat, where you just can just plant more at marginal cost (I'm sure someone in farming will now explain why that isn't exactly true either).
I'm not super familiar with farming, but I'm pretty sure there is an upper bound on how much wheat you can plant dictated by the amount of land you own.
I feel like I and HN live in different worlds,
https://www.blocksandfiles.com/ai-ml/2026/01/20/samsung-sk-h...
Big manufactures have absolutely cut production of lower margin products and it's not like they can re-purpose all of the equipment used for it for HBM yet. edit They can definitely focus more resource because of it on HBM though.
Things have improved a bit since govts are starting to get angry.
Tldr; no one is cutting the production of high margin stuff, but low margin stuff can go and die, because it's not a free market it's a stock market these companies want to show off better margins in every unit there is no reason to keep inefficient things running when not doing it pays more.
They just don't want 30-40% margins anymore. That is not free market that is quite literally serving their own interests because they know there is a monopoly.
All big memory manufacturers are heavily supported by the govt, that's what has made them the monopolies they are Micron supported by USA (they crushed Japan's memory industry for it), and Korean giants are more tangled up with the govt than well most people in US would realize.
Somehow people think free market means anything goes, which honestly is where we stand today so I don't blame anyone.
But using govts to crush competitions and build yourself up on subsidies and similar isn't really free markets. China hasn't been able to grow a significant memory chip industry yet because of lack of EUV machines and similar technologies blocked by the US, which is also not "free market".
As for WD, and Sandisk separating I feel like this was more mutual and they new HDDs or SSDs being together was a distraction for both. Which feels more strategic, think of it like this, the shareholders who had the shares how hold shares in both and together they might have likely been worth less so shareholders made money.
Aka good for free market. I don't see how that relates to the actual memory crunch issue more broadly.
Margins pre-AI were more like 5-15%. Even if the margin was 5%, if prices increased 5 times but product cost didn't move, then margins are now 80%. That's not a 30-40% product, your argument doesn't make any sense.
Feel free to spin up a fab and undercut the current prices, I'd certainly appreciate it!
I don't know if I would personally fund such a venture though, for roughly the same reason existing manufacturers aren't expanding production.
How about I threaten you with mandatory 10 Electron applications / AI agent harness on your computer? Now you must be ready to fund my venture :)
If you did, then the big manufacturers would just sell a competitive product, at a loss if necessary, until you are driven out of business.
CXMT is about to reel in Apple as a customer and I don’t see Samsung doing a whole lot about it.
> the memory manufacturers have refused to budge on creating new fabs
That's EXACTLY how a free market is supposed to work. The existing memory manufacturers are FREE to not build new factories, and anyone else is FREE to build those factories in their place.
Then perhaps we’re seeing one of the downsides of that. When 0->1 is prohibitively expensive, existing players can continue to raise prices *very* high because cost-of-entry is extreme, until it’s not sufficiently extreme.
And then we have bubble issues because the introduction of a new, cheaper player, causes the bottom to fall out and for the circumstances that allowed the new manufacturer to exist to completely go away.
In addition of being expensive, it's also a gamble. If it wasn't risky then I don't think financing it would be that big of an issue.
This is also caused by the FREE market - consolidation, all markets tend to consolidate around a few companies due to economy of scale.
The fix is regulation - we are going to have NOT-FREE-MARKET electricity, NOT-FREE-MARKET water supply, .... for vital services.
I'm not talking about you, it's funny to see anti-regulation HN complain about a FREE MARKET working as such. Suddenly it's not so fun where you are at the losing end of the free market when it turns out some are willing to pay way more for RAM than you are.
Everybody needs electricity and water, but nobody needs more RAM except for companies. And they can pay for it.
You can travel to the ends of the earth, to a village down miles and miles of dirt roads and still see someone bent over their phone. People buy RAM.
> but nobody needs more RAM except for companies.
I'm amazed you could write this in apparent seriousness.
Be so kind then and tell me what a normal citizen would need more than 8GB of RAM for, if it isn't for professional work or a specialized hobby?
A Mac with 8GB of RAM is blazingly fast for any task your average person would need for it to do. Which doesn't include gaming, mining crypto, or heavy AI models.
Maybe I've missed something? So please tell me exactly what task requires more than 8GB of RAM which is so necessary for the average citizen that the government should subsidize it?
A Windows 11 machine with 8GB of memory is borderline unusable.
We can go in circles about how developers need to optimize their applications, etc but truth of the matter is that 8GB is considered pretty low for a lot of "average" use cases. MacOS is an exception to the rule and even 8GB on MacOS is limited with multiple Electron apps.
And why should the government and the tax payers be held responsible and be forced to pay for the bad decisions of Microsoft and their customers?
MacOS is not limited in any way for the needs an average citizen has from computers. The average citizen is even fine with an iPad. 8GB is considered "low" by people here, just like a 170 horse power hatchback is considered "low" by muscle car enthusiasts and mining companies looking for dump trucks. But those uses have no bearing on reality for most people.
Hello!? Us consumers need it too.
Really depends how you're defining "need".
Will you die without it?
Will your life as you know it end if your next phone has 8GB instead of 12GB?
Those questions can’t get to the root of how the GGP is using the word for two reasons: 1. Companies, not being alive, can’t possibly need in this sense without analogy. 2. The poster included electricity as something everybody needs but there are people surviving without it.
You need 8GB at the very most, which isn't out of reach for any consumer. If you need more, then you are a professional and can afford more. Or you are a hobbyist, and your hobby doesn't deserve any subsidies from the hard working tax payer.
> You need 8GB at the very most
I call total bullshit on that. I need more.
Why would you need more compute power than other people? An 8GB machine is already way beyond capable for anything a consumer - and most professional - can throw at it.
And why in the world should the government force tax payers to subsidize your extraordinary computing needs?
Have you ever used a computer?
No, have you?
> But we don't live in an absolutely free market, the memory manufacturers have refused to budge on creating new fabs until recently out of caution
...that's how the market works. This is called capital discipline and is standard across industries. If the increase in demand is temporary, they would be spending 5-10 years of profit on facilities which will only lose money. The same works in non-capitalist economies too, you don't want to waste resources on stranded assets and many still believe this RAM demand is temporary and the house of cards will collapse.
FWIW I have a friend who makes hardware and it's extremely difficult for him to secure memory at any price. Because AI people have locked up so much of the upcoming supply it's often not a question of how much it will cost but of finding someone who will sell you memory at all. If this were price gouging I would expect he'd have no trouble finding allocations at exorbitant prices but that doesn't seem to be the case.
same here, even when we went to larger hardware producers, they were basically we would sell you, but we cant actually get any RAM at all either.
There are never shortages in a free market, just higher prices.
I have some bad news about how closely Econ 101 resembles the real world…
You appear to not understand how markets work, free or otherwise. For the purposes of this conversation, consider starting your education here: https://en.wikipedia.org/wiki/Barriers_to_entry
At a longer timescale than very temporary supply shocks, I believe what I said is correct. The basic point is that if supply contracts, demand must contract as well, which in a free market happens via price increases and in an unfree market happens via shortages (i.e., the inability of buyers to obtain a good at a market-clearing price). If high barriers to entry are relevant in this context (obviously they very much exist in the memory industry!), then please enlighten me how, if you are capable of doing so without unconstructive snark.
But currently we are in a very temporary supply shock, and its called a shortage.
> in a free market happens via price increases and in an unfree market happens via shortages
Since people have earmarked purchases in advance the market isn't free, I'm not allowed to buy the ram another person already bought. Its the same how the texas electricity market works, prices reach infinity since there are more consumers that have already bought electricity than there is electricity left to provide, and you get a shortage.
Free markets with contracts aren't free since contracts creates constraints that results in shortages like this.
Great explanation, thanks.
There are only 3 manufacturers (about to be 4 soon) total. This is a demand crunch the likes of which the market hasn't seen before, prices are doing the natural thing.
You make it sound like the crunch is caused by manufacturers, my understanding is that it is caused by the abnormal demand. I am not aware that RAM production is at a historically low level.
It's actually both. DRAM manufactures operate on a boom bust cycle and by 2023 there was significant oversupply. This meant even leading up to that they had already decided not to invest in further capacity explicitly to recover profit on their existing lines.
So a lack of builds coupled with AI boom at the same time created a perfect storm with no new capacity coming online for years after demand rapidly escalated.
Demand crunch comes from the customer. All HBM and DDR5 wafer capacity is sold out through 2027 and all three vendors are booking 2028 capacity.
This was not created by the manufacturers.
The manufacturers are not doing a whole lot to fix the problem l and I don’t blame them. It’s expensive to build out and they know demand will slow down and don’t want to be stuck with excess capacity. Better to be sold out and high prices.
Samsung said they were “moderating demand” which doesn’t sound like they want this problem to be solved either.
If you are talking CXMT Apple recently learned the hard way that even with price fixed RAM from the big 3, CXMT is struggling to provide cheaper prices as they are using much older design/manufacturing systems.
https://www.msn.com/en-xl/money/general/apple-s-cxmt-memory-...
who is the 4th?
Intel is also looking into returning to making RAM, but it's probably the Chinese that will enter the market faster
Probaby CXMT
What about YMTC?
Tiny market share compared to top 4, but also looking to expand into HBM in collaboration with CXMT
https://chipletsummit.com/proceeding_files/a0qVV0000032cp3/2...
> There are only 3 manufacturers (about to be 4 soon) total.
...3 manufacturers with a long history of price fixing...
https://en.wikipedia.org/wiki/DRAM_industry_price_fixing
Uhm, your link states that they were price fixing over 20 years ago, and were in court for almost a decade. There was another accusation in 2018, but it was dismissed.
That's not a long history of pricing fixing, just accusations.
The difference between 2002 and now is that it is so much easier to follow each other's leads on pricing without explicitly communicating about it and leaving a paper trail. But they never stopped acting indistinguishable from a cartel.
I remember the cost of RAM in the 80s and 90s. If I remember correctly my mom paid ~$1000 for 32mb of RAM in 94/95. Something or other like that.
While they have spiked this year, the trend is towards more RAM for cheaper.
https://ourworldindata.org/grapher/historical-cost-of-comput...
Micron for example discontinued their consumer business because of the demand from enterprise business.
>and how much is this just manufacturers taking advantage of it
"Manufacturers taking advantage of it" wouldn't take it to 500% without AI, because it's way beyond the price elasticity points where they make up lost sales at higher prices.
Those prices lose most consumer sales, and are only viable if there's constant high demand that's relatively insensitive to price (so, not regular folks, but e.g. AI companies).
Same thing happened with eggs in the USA with bird flu used as an excuse.
Which reversed in about 6 months and now eggs are are their lowest prices in nearly a decade.
The average hatching egg costs a few dollars. Can go as high as nearly $20 if it's something remarkably rare and useful in terms of breed/quality.
An egg takes 21 days to hatch.
Then it's 18-24 weeks to start laying their own eggs. That's ~$5-15 in feed over the period, maybe 40-50 pounds. There's utilities, labor, land, etc., but your incremental cost to add a hen if you have the space is minimal. My numbers won't reflect a lot of operators, as scale matters.
Out of a typical 1.5-3 year lifespan that had a startup cost of a few dollars per, paying back its return by about month 6-7, that's not too bad. It's only worth doing financially in this economy at ludicrous, arguably inherently inhumane scales, but that's what it is on paper.
Not quite the same path to course-correction as a silicon shortage.
The same thing will happen with RAM. A glut will come eventually. It might take a year, maybe two.
Isn't next year's capacity already sold out? Is there any reason to hope for significant additional capacity to come online during that term?
Eventually 2028 and 2029 will come around and at some point today's data center builds will be (economically) full.
In addition to that there are extra fabs build and (for example) China can use the high margin to catch up with their processes without breaking the bank.
We can dream. I would do unspeakable things with 512GB of RAM.
thank goodness the adults are in charge now
It could be the economically rational thing to do if they think there is a bubble
Forming a cartel to rig prices is economically viable with or without a bubble.
Taking advantage of Trump admin, AI hype, and setting themselves up as "too big to fail" for bailouts when demand eventually collapses
See the tariff thing where Bessent bought rights to refunds
It's all a really low tech con perpetuated by weak elders who need blue pills to simulate virility. Odd how they complain about the kids virtual reality.
Oh no it's not either; it's intentional petty bullying
Demand and manufacturers not increasing capacity.
Eventually someone will manufacture more to undercut
The problem is the scaling cycles for demand and supply are at different timescales. It takes a lot longer to build capacity than these bubbles take to form and pop and there is a SIGNIFICANT history of silicon manufactures scaling during a bubble then going bankrupt because their increased capacity never had the chance to make them any money.
To take advantage they'd have to do some form of price fixing which in most places is a very big footgun.
I honestly don't think they need to fix their prices, and it's possible that selling to consumers is a secondary market for them compared to datacenters, like Nvidia selling GPUs to gamers. We know that's not where the money is.
Seeing some companies actually exit the consumer market is evidence for this.
> To take advantage they'd have to do some form of price fixing which in most places is a very big footgun.
When parent commenter says "They have done this in the past after all" that's exactly what they're talking about. Micron, Samsung, Hyinx (prior to SK Group acquisition), and others all participated in RAM price fixing in the early 2000's.
https://en.wikipedia.org/wiki/DRAM_industry_price_fixing
If it's a highly profitable footgun why not?
https://en.wikipedia.org/wiki/DRAM_industry_price_fixing#202...
If something is illegal, and the punishment is a fine, it's not illegal it just has a cost.
Is it worth the cost? Yup.
Just to be clear the big Memory giants are famous for their price fixing historically speaking.
What is also interesting is no one predicted this in 2022-2025 as LLMs were gaining widespread use. It just suddenly happened--"boom!" memory shortage in mid 2025 to early 2026,and it caught everyone by surprise. It was understood that the biggest bottleneck was "compute", not the memory. Even experts, such as popular AI bloggers, industry leaders, and top podcasters failed to anticipate this. No one on twitter either. I spend a lot of time online and I don't recall, afik, anyone before 2026 saying to buy memory stocks.
Sam Altman laying claims on 40% of the world’s RAM wafer production is what took everyone by surprise. The supply shortage likely would have ramped up more slowly otherwise.
More importantly that did take subterfuge: there's no way a contract that large would've been agreed to by both manufacturers if they knew the other was signing it.
The actual deals were hours apart and secret for that reason.
It's hilarious watching the conspiracy theorists do their usual thing when there was an actual conspiracy, it was perpetuated by the inner circle of a US company and announced and publicized in full once it had achieved its goal.
I think Leopold of "situational awareness" fame predicted this, tried to make it widely known on podcasts and x, and still started billions worth of hedge funding based on this.
> I think Leopold of "situational awareness" fame predicted this, tried to make it widely known on podcasts and x, and still started billions worth of hedge funding based on this.
Ironically enough it's because of its bet on RAM companies that all of Situational Awareness' publicly trading stocks got bought by the highest bidder (Citadel) when the (leveraged) shit hit the proverbial fan and Situational Awareness created a hole of tens of billions.
Situational Awareness was not forced to sell its share in Anthropic for, by contract, investors in Situational Awareness have no right to force the sale (before this month of September I think) of shares in companies not publicly trading yet.
Citadel bought those RAM stocks right at the end of July, during the dip. Amazing timing for for example MU bounced back from $746 back to above $1000 (now around $950).
Now Situational Awareness may still do exceptionally well: they've got $5 billion or so left in Anthropic AIUI.
Everyone in cloud knew this was going to happen, the contracts for all parts of server stuff were measured in years.