Comment by rasz
A LOT of businesses learned during Covid they can make more money by permanently reducing output and jacking prices. We might be witnessing the end times of economies of scale.
A LOT of businesses learned during Covid they can make more money by permanently reducing output and jacking prices. We might be witnessing the end times of economies of scale.
It seems more likely that someone else comes in and either colludes with the people who are screwing us to get a piece of the action or gets bought out by one of the big companies who started all this. Since the rare times companies get caught they only get weak slaps on the wrist where they only pay a fraction of what they made in profits (basically just the US demanding their cut) I don't have much faith things will improve any time soon.
Even China has no reason to reduce prices much for memory sold to the US when they know we have no choice but to buy at the prices already set by the cartel. I expect that if China does start making memory they'll sell it cheap within China and export it at much higher prices. Maybe we'll get a black market for cheap DRAM smuggled out of China though.
In that case it's far simpler - even IF they wanted to met the demand, building more capacity is hideously expensive and takes years.
So, it would happen even with best intentions and no conspiracies. AI boom already hiked GPU prices, memory was next in line.
I think in part it is a system level response to the widespread just-in-time approach of those businesses' clients. A just-in-time client is very "flexible" on price when supply is squeezed. After that back and forth i think we'll see return to some degree of supply buffering(warehousing) to dampen down the supply levels/price shocks in the pipelines.
I thought that, too, but then the Nexperia shitstorm hit, and it was as if the industry had learned nothing at all from the COVID shortages.
The idea is someone else comes in that's happy to eat their lunch by undercutting them. Unfortunately, we're probably limited to China doing that at this point as a lot of the existing players have literally been fined for price fixing before.
https://en.wikipedia.org/wiki/DRAM_price_fixing_scandal