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Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

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Re: Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

#171

Post by windexh8er »

Stitch4223 wrote: post #112
mywittyname wrote: post #105

Earlier quoted context omitted.

We have to decide what part is damaging to society: the actual physical agreement, or the effects of the agreement? If it's the actual physical agreement that's the problem - the system is working as intended. But if we are looking to prevent the negative outcomes associated with price fixing and collusion, our system is failing us. They are never going to find proof of conspiracy. The people involved covered their t…

You'll have to create a case that harm is taking place. Harm does not mean a PlayStation 5 is now $200 more expensive or that inflation exists. I would look at questions regarding what harm is created: Is it discriminatory? Are parts of society shutting down, and is that unreasonable? Are groups of people now unable to afford a living? Does it move the poverty line? Is that permanent? And how do you prove this is exc…

They've done this in the past. Between 1998 and 2002, DRAM manufacturers conspired to fix prices and were sued by the DoJ. The companies included Samsung, Hynix, Infineon, Micron, and others. They coordinated through phone calls and meetings to set prices and limit supply and that directly caused harm to consumers [0]. Curious what we get out of the lawsuit discovery, but now we only have 4 players so hopefully it will be obvious if they're playing the same game. Price fixing seems seems like the easy button when you look at the margins per product over the last couple of years.

Gamers Nexus has done a lot of reporting on it as of late [1][2].

[0] https://en.wikipedia.org/wiki/DRAM_price_fixing_scandal [1] https://youtu.be/R1jsbfouRQY?is=PZnyIjUjSK5UuGpL [2] https://youtu.be/jVzeHTlWIDY?is=PZOHQaaqb49hcBs9

Re: Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

#172

Post by mschuster91 »

cosmic_cheese wrote: post #145
fennecbutt wrote: post #143

Earlier quoted context omitted.

>the gravy train isn’t going to last forever. Have you seen how the modern stock markets works lmao? It hasn't been based on reality in a long time. Hell just look at Trump, should've run outta money from all his bad deals ages ago but the grift continues.

It's true that markets have no need to be rational, but everything has an end and it's usually sooner than anybody ever expects.

People have been saying AI is a bubble for at least a year now and, unfortunately, it still hasn't collapsed.

Re: Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

#173

Post by mschuster91 »

Danox wrote: post #128
russli1993 wrote: post #51

Earlier quoted context omitted.

memory is a commodity is laughable. Then software engineering is even more a commodity, the amount of engineering going into making memory chips the vast majority of people don't understand. There are a lot of software engineers getting this field after leetcoding and copy from hellointerview. Claude can write you an app in 30 minutes. Try build a lpddr5 dram chip in 30 minutes. Manufacturing know how itself is a spe…

It’s a barrier, but not an insurmountable barrier. Most of the companies are somewhat lazy and somewhat cheap, but if circumstances change in the market, that make it untenable, they will take on making their own memory or making arrangements with someone else. It’s been done with processors, modems, SSDs and many other specialized chips. The design and engineering part can already be done at several companies, they…

> It takes two to four years and Five to twenty billion dollars. Some of the bigger companies, if pushed, particularly, if the alternative is getting chips from China, will do something on the fab side if they absolutely have to. They probably won’t live with the current conditions forever.

The problem is... the market consolidated into this oligopoly for a reason. Memory and storage have gone through so, so many pork cycles over the decades.

To make it worse: even if you had the money, ASML is booked out fully for years. You won't get the lithography gear.

Re: Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

#174

Post by soraminazuki »

zuzululu wrote: post #69
mrtksn wrote: post #38

What happens if Samsung and SK Hynix simply stop selling to US at all? Micron is in US but are the rest still in the US jurisdiction? They are selling the hottest commodity of the day. It’s made outside of the US using non-American tooling.

regime change in South Korea. President Lee Jae Myung isn't exactly popular among Washington circles

In the region are Japan, Taiwan, China, Russia, and North Korea. Only incompetent idiots at the highest level of power would start off a whole new geopolitical disaster there by stabbing an ally, of all things. Who in the right mind would do such a ... ohhhh.

Re: Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

#175

Post by mschuster91 »

the_solenoid wrote: post #166
microgpt wrote: post #73

Earlier quoted context omitted.

How do we know it's cartel behavior, not just free market competition?

IMPORTANT CONTEXT TO MY ANSWER: There is no such thing as a free market There are 3 suppliers in the world that together have ~90% of global DRAM manufacturing capacity. I did not say they definitively were a cartel, but the effect is the same: raising prices together, lack of competition (via market consolidation etc) means there is no viable way to make more capacity in any kind of reasonable time frame, and they a…

> Now, I find it odd that to this day, there are still only 3 suppliers and ram prices (and SSD prices) have not really followed a reasonable pricing curve save for a few maybe a year pre-thecurrentnonsense, where it was getting closer to what I would have expected

The core problem is, there is only one company making top-of-the-line lithography processes. Even if you are a government - ASML (and their suppliers) are fully booked out.

And even if you had dozens of billions of euros to sink into such a venture, you'll probably go online right into a bust phase of the pork cycle that drove the consolidations of the last decades.

Re: Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

#176

Post by craigjb »

mrtksn wrote: post #38

What happens if Samsung and SK Hynix simply stop selling to US at all? Micron is in US but are the rest still in the US jurisdiction? They are selling the hottest commodity of the day. It’s made outside of the US using non-American tooling.

Applied Materials, Lam Research, and KLA are all U.S. companies. ASML supplies lithography, but hundreds of other tools come from these companies.

Re: Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

#177

Post by steveBK123 »

This is probably the one moment in time there really doesn't need to be any price fixing / collusion.

If demand for your product has temporarily spiked so high you can have 80% margins, then its not like your competitor has any reason to price compete.

Particularly in an industry where spinning up new capacity is a multi-year $10s of billions investment.

Re: Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

#178

Post by charcircuit »

mrtksn wrote: post #72
ksec wrote: post #67

Earlier quoted context omitted.

If history is any guidelines that would be how World War III starts. There is nothing that stops US from building their own Memory Fabs, or asking / funding Micron building more US Fabs. It will cost a more, but the complexity is certainly no where near replicating TSMC.

US is in a very advantageous position regarding geography and resources but its problem is that its geared towards having access to the whole worlds markets. Apple, Google etc. are all possible because they server billions of people, not just 350M. IMHO US will have serious internal trouble for years, eventually stabilizing and being a nice place again.

>Apple, Google etc. are all possible because they server billions of people, not just 350M

Most of their revenue comes from America. Not all countries have the same profit margin per user.

Re: Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

#179

Post by steveBK123 »

AnthonyMouse wrote: post #148
thewebguyd wrote: post #136

Earlier quoted context omitted.

> but that they're not increasing it fast enough That also isn't illegal. A business can choose to artificially restrict supply if they want, there's no mandate that they must meet demand. It only crosses into illegal territory if multiple companies get together and secretly agree to cap production to keep prices high. Then it becomes collusion. It also becomes illegal if there's a monopoly power that is intentionall…

> A business can choose to artificially restrict supply if they want, there's no mandate that they must meet demand. There is, however, no incentive to do this when prices are high unless you expect competitors to do likewise, since otherwise you're just handing the business to the others when they increase production. Which strongly implies that if that's what everybody is doing, they're colluding. > The hard part i…

> Which is the problem when that's what's happening, and why we should maybe change the law to infer the collusion from the outcome in cases where prices are high yet nobody is responding by increasing their market share.

No one has a crystal ball. Soviet planners figured that out eventually. You cannot punish people for lack of crystal ball outcome foresight.

Are we going to punish Micron for not planning a new fab 3 year ago when they had no margin and Apple was squeezing them to the bone? Do we co-indict Tim Apple?

Or wait, they were already trying to build one in Upstate NY that is stuck in NIMBY red tape. Do we co-indict Kathy Hochul?

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