Samsung recently shifted some capacity from HBM back to DDR5 modules, freeing up around 80,000 wafers/month, so DDR5 margins are currently good enough to compete with HBM for wafers, or maybe they are anticipating a turn, or both.
So they must use older equipment, which has low productivity for state-of-the-art memories. Because of the "sanctions" there are now Chinese companies that have progressed significantly in semiconductor manufacturing equipment, but the effect of this will also take some more time to manifest.
Nonetheless, if the 3 big memory producers will not be able to increase the availability of memory until 2028, then until then CXMT will grab with certainty a major part of the market (they have already grown quickly until 10% of the market, from a negligible percent previously).
Was that also capital looking for returns?
https://pcpartpicker.com/trends/price/memory/#ram.ddr5.5600....
The exception is CXMT, which uses ASML DUV machines in a less efficient process.
For DRAM, CXMT were only 1% of the global supply 3 years ago, and are now already 10%. They are growing extremely rapidly.
If you are concerned about consumer memory - smartphones, laptops, desktops, then this is what CXMT are making. CXMT do make HBM too, for AI accelerators, but their volume there is held back by sanctions.
Effectively: "Now's the time to invest..."
Is there nothing we can do but pay the absurd prices and be happy about it? There is no hope left?
I'm genuinely afraid.
That and, if you're into gaming, thank your lucky stars that there are all sorts of games from 15 years ago that are every bit as much fun now as they were then.
Finding out how to make the best use of the large amount of DDR3 RAM I have.
Those Chinese C612-based boards for the E5-2696v3, et al. (which support DDR3 and DDR4) seem OK with the custom BIOSen out there.
... yet.
That is why the big AI corps all went public this year or are trying to do so. They are valued large enough that they will be included in the popular indices (NASDAQ, S&P 500, ...) from the start, which means an awful lot of money will flow into them each month automatically from all the retirement savings.
And that unfortunately completely prevents the core function that stock markets should offer - that bad actors get punished. Can't get punished when there is so, so much "dumb money" floating around and entering the fray every month.
When the AI bubble bursts, Nvidia is going to be Enron.
AI bots (probably powered by NVIDIA chips) would gobble those up in seconds.
Because it would immediately go to scalpers anyway. Like, say the 5090 - I'm seeing prices of almost 7000€ for that thing [1]. Assuming without AI it would be priced at 1500€ - I could make about 3 months of rent just by immediately selling the GPU to the next reseller who then peddles it to some AI training farm. And in this economy, oh hell yes I would.
> When the AI bubble bursts, Nvidia is going to be Enron.
Nah. NVIDIA was a money printer way before AI was a thing. Post-collapse they will still be a money printer, just at lower speed.
The ones who are going to get fucked over hard when the AI bubble pops is pensioners, the generation who is just entering the workforce (2007ff had an aftereffect in wage depression lasting for up to a decade), and everyone who took up investments to service the AI demand (utilities, construction companies and the likes).
[1] https://www.pccomponentes.de/msi-geforce-rtx-5090-ventus-3x-...
No they wouldn't, tens of thousands of unique users would be in line with dozens or hundreds of scalpers, if they're all allowed to buy one every 180 days per payment method, the end users actually get a fighting chance. Today they have no chance.
There is enough profit to pay people to buy stuff and resell it.
I've watched vans dropping of an endless stream of people in the parking lot of my local Costco to buy out all the cases of Pokemon cards within 20 minutes of the "random" drop they put on the floor. They go in, buy the max quantity of the item with cash provided by their keeper, bring it back to the van with a receipt and change, and get the $20-30 per item pay they were promised. There were 2 or 3 'legit' buyers out of hundreds of obvious straw buyers.
If the profit per item is $4-5k, expect this to go into turbo mode and be done in a marketplace/automated fashion and go viral. Just sign up to your favorite scalper's platform, submit your information, get a quote and a prepaid label and drop the box you got from nVidia off at USPS the next day. That "tens of thousands" of individuals will turn into "millions" really quick once it gets known there is rent money involved by clicking a few buttons and it goes viral on all the social media platforms.
The only way out from that is manufacturer enough cards to meet demand, and at that point the retail channel doesn't really matter.
When are we getting the wave from REIN (Rewrite Electron In Native)?
The only chance of memory demand going down would be breakthroughs in model size reduction.
So on the one hand you have all the sota model makers doing investor expectation management in saying wet need a slowdown for safety (may or may not be true, but also means they don’t spend on the next training cycle before IPO? Could be making their books look better too?) and on the other we have a sense that the models aren’t yet at the stopping place where we can just not train another cycle and use distillations of the current generation?
The amount of money spend on the AI hype train is crazy. Meanwhile we're wasting fab time making chips that might never be powered on. It's absolutely insane that there are more money to be made on hardware for AI that may never be used, rather than producing a product that consumers and businesses need right now.
I’ve seen people say, “well that’s just the free market, there’s a customer that’s willing to pay more than you,” but that argument doesn’t hold water when industry incumbents are actively obstructing entrance of new competitors into their primary markets. Micron, etc can’t both refuse to carve off more of their capacity for consumer-destined NAND and also refuse to allow others to fill the vacuum they’ve so conveniently created. Either you’re serving the market or you’re not; you don’t get to have your cake and eat it too under properly functioning, healthy capitalism.
Why the need for speculation?
MICRON INSIDER TRANSACTIONS (LAST 6 MOS)
Purchases 887
Sales 337,619
Seems like the Execs aren't seeing this as a good thing for their company
It makes sense to de-risk your supply chain and at this point memory is a key supply risk.
I think supply will be tight until at least the AI market crashes, which could take years or happen within months. Nobody can really predict when this will happen but it's fairly clear (IMHO) that the revenue projections needed to justify the investments by OpenAI, Anthropic and SpaceX simply don't exist.
Without the AI boom, the economy is in recession and has been for awhile. We're in an affordability crisis and the energy crunch is coming.
I would now like to open the floor to investigations in this industry to determine whether this is hindering free-market forces and is ripe for regulation, as no-one is able to actually compete with these handful of companies anymore.
...anyone?
...ah yeah, right, I forgot. They also found a circular financing scheme which enslaved the entire global economy and organically prevents governments from properly governing their industry.
Or did I mess that up?
https://www.tomshardware.com/pc-components/dram/chinese-cxmt...
And you are now encouraging other large pocket tech companies inside and outside China to give thought to taking memory in-house if that means making and selling devices at a reasonable price in a timely manner.
Building a DRAM company from scratch is hard, expensive, and risky. You're burning a fortune to get started, and the result is a commodity product. But the AI bubble allows CXMT to have terrible yields, sell a legacy product, and still make a healthy profit! This is literally a once-in-a-lifetime opportunity to catch up.
And yes, right now that means selling DRAM for 10% below the crazy AI-inflated prices the incumbents charge. But sooner or later either demand will drop or supply will catch up. CXMT, like many other Chinese companies, is undoubtedly willing to operate at razor-thin margins to increase market share. Either the other manufacturers move down as well, or they'll be made irrelevant by CXMT stealing all their customers.
Only way to keep prices this high would be a multinational cartel of RAM makers agreeing never to compete on price. One defector kills it. Not likely you could keep a cartel like this given that the players are all on different sides of geopolitical tensions. China's not going to want to help keep Taiwan, Japan, Germany, or the USA in the money.
You are going to get busy. and design and engineer around the cartel. Is there one company in the world that might do that? A company that has the engineering, design and the money with the capacity to execute over time?
Because that would be smart. And they have the packaging tech to add compute to it.
So either the labs need to start printing money, now, or there’s going to be a whole bunch of excess chips hitting the market in 2027-28.
Someone in the middle is going to get left taking delivery of all these chips but unable to collect payment for them. And someone else is going to get left holding the bag on data center loans to house those chips. That’s the storm ahead.
It’s a big problem which neither big lab has a great answer for right now.
These labs made a bold bet that cost trillions, but those trillions in research are a box of concrete around their feet now
In the long term, the big comapnies are pushign to have consumers to adopt "terminals" back in old days.
- we use crappy devices, while cloud got beefy machines.
this would be the time to revive and evolve some of that Made In Germany Engineering ...
The way Chrome feasts on RAM, might need the cloud for that too.
But at the same time, this isn't just a Firefox issue, although they may be worse than most. Its a fundamental tenant of GC languages. You trade CPU (for the garbage collection) for RAM utilization. IIRC This was apparent by the late 70s with Dijkstra, but very clearly indicated in say Hertz where they are explicitly scaling GC overhead vs memory footprint to find that it takes ~5x the ram to approach the efficiency of an explicit allocate/deallocate model. Lower footprints are achievable but the GC overhead goes way up just to reach 2x the ram footprint such that the GC tends to dominate the CPU utilization.
And there are lots of papers like this for long running processes. GC works well if your model is basically allocate as much as you like, exit the process before actually needing to do a proper GC pass. Especially for contended systems where the memory is returned to the OS. This is why say PHP tended not to have this problem, because the memory was largely freed at the end of every request.
- the described behaviour is the one I experience on my Win10 notebook (Lenovo X1)
- Firefox wasnt always that, thats what Im refering to
- I can see in ProcessExplorer how many threads it starts & keeps, and for whatever reason this is always a lot, even if I open only 1 tab after coming from new start
If there’s a silver lining, I hope it leads to more optimisation, less Electron, and less bloat.
Typed from my 8GB MacBook Neo; which is honestly plenty fast enough. It “feels” like a 16GB windows laptop, even tho of course I know it’s not, but there’s something about optimisation.
It’s like saying that there is no housing crysis in several countries because the market is full of houses, apartments, etc.
- one of those "frontier" model IPOs s gonna tank badly and take out the entire AI hype with it
"Crypto is the last 'big thing' because it'll revolutionize currency and everyday transactions"
"Metaverse is the last 'big thing' because everything you own will be virtual in the future'
Realistically I see AI as no different.
It wasn't the first SV-techbro hype technology, and it won't be the last.
We've had AI "bubbles" / hype-fests before (expert systems, Japanese 5th generation systems), and I don't expect this will be the last.
There will also be technology bubbles and hype-fests in the future outside of AI - it's human nature. Hard to predict what they will be of course (the future is like that).
Make no mistake here: they also plan to retain these high prices. It's like the mafia now. There should be instant-jail time to cure these CEOs of their greed. Like, go to prison for a week, to help refresh your mind and stop thinking in terms of milking the customers dry.
It makes me consider whether there would be retaliation in later years against the US intellectual property system in countries other than China. While RAM is a tangible product, the areas it serves aren't really.
Such collusion might well be a violation of anti-trust law, but in any case, it wouldn't work. If they decide to sell at below-market price, they must (by definition) be preventing some customers from buying by some non-price mechanism (eg, only selling to companies run by other members of the CEO's family). Potential competitors would then see an opportunity to sell to these excluded customers.
If there was enough existing competition, that might be the right move, because if they don't increase capacity, a competitor probably would in order to gain more market share. But I think the barrier of entry for making RAM is high enough that Micron can probably get away with keeping supply low (and thus prices high) for at least a few years before a new competitor appears. Assuming demand stays high that long.
They have two massive DRAM fabs (56000 m^2 cleanroom size each) that they started construction on in 2022 and 2023 in Idaho, with production starting in 2027 and 2028.
I don't think it is possible to beat the fab construction delays. This isn't about things being slow in the US: TSMC took four years to go from site selection to some production at their Fab 22 plant in Taiwan (it is currently only 60% built out, is my understanding). And TSMC is best in the world at getting frontier (logic) semiconductor fabs built, it took them slightly longer (five years) for Fab 21 in Arizona. Logic fabs are not the same as memory fabs, but they are close enough to be a good comparison for timeline.
Basically, unless you started fab construction (specifically to make memory chips) in 2023 you cannot change production for 2027 and 2028. The only thing that will affect prices between now and 2028 is demand, production can't go up because the fabs to make those chips don't exist. If you started now you might get memory chips in 2031, and can you bet 40 billion dollars that the demand will still be there? (A current generation logic fab costs about 20 billion. By 2031 a new frontier logic fab will cost about 40 billion). I don't have prices for a current memory fab, but as I understand it they are comparable.)
But you are right someone will arbitrage the price, like scalpers selling concert tickets.
A well-known anticompetitive tactic is for a big player with a vast bank account to move into an area and eat losses while waiting for their competitors to starve. Well observed in the 90's movie rental market, so certainly real.
To successfully perform dumping, you have to have access to excess supply capable of disrupting that market.
So if that's the expected outcome, it might be better to prevent competitors from building factories in the first place.
(Legitimately asking: I don't know the answer ... but based on most US business law my strong suspicion is ... no, they don't.)
Also I was truly asking if they weren't aware in disbelief, since I assumed it was common knowledge.
These are billion dollar+ funded operations that take multi-years just to see if you can compete at the levels required.
All these comments show up every time, like there's a memory faerie land where you just put on your memory faerie hat and walla! Memory!
So bizarre.
There's nothing volatile about the AI bubble, it's been going on for a while regardless of cost and that will continue because of politics - which is rather transparent.
> I just don't see why someone who invest several multi billion dollars to squeeze into a potential window that may or may not last 3 years.
Interesting, Chinese companies don't seem to know this, they're investing bigly in RAM and other silicon despite being sanctioned and tariffed up the wazoo. Should we tell them that it's a crunch for no more that 3 years so they don't waste themselves for nothing?
The more interesting question is why Chinese RAM is hugely tariffed, if not for preserving the crunch and its monopoly pricing?
> I mean, we can assume the people who make the memory love getting huge prices for it.
Your mistake is to think of the RAM makers instead of the systemic reasons for the problem, these would have to include tariffs, sanctions, subsidies, etc that drive market pricing, RAM manufacturers and their potential competitors.
It's also possible they're preparing for the possibility that they get cut-off and so profit is not the primary motivation. As you mention, they're already sanctioned...
Also, CMXT started in 2016 so that gives some indication of the timelines involved. Even in Taiwan it's like a year and a half just to get the building made and these are experts operating in their own country working 24/7. That timelines doesn't include equipment into it, which is also in shortage, and getting lines qualified.
https://www.tomshardware.com/tech-industry/building-a-chipma...
The Memory cartel do not care about silly things like laws
In economics, "demand" doesn't mean "I want this", it means paid, funded demand. 100s of millions of "free" LLM users aren't funded demand, they're subsidized. This leads to front-running and scalping the silicon market at an unreal scale, it also monopolizes access to silicon and compute. Nothing happens by chance here.
2 years is not remotely enough time to spin up a competitor. It's not even enough time for a current leading competitor to spin up another fab.
If you are a newcomer you are talking a decade or more before mass production. If you are HK Hynix perhaps 5 years or so.
The majors all have large fabs under construction, but the majority of new production from those facilities won't be coming fully on-line until 2028 at the earliest. Even from the date of first wafer shipped most of these facilities take 6-12mo to reach mass production level output.
Chinese DRAM is interesting only because they started building capacity (expertise) a decade ago. Only now are the expected to have any material impact on the total volume of the market. And if they want to gain even more market share, they will be under the same ~5 years to spin up a brand new fabrication plant. Perhaps a bit less because they are China, but still multiple years.
Micron started building it's new fab in 2022. They are expecting their first chips to be out by 2027 (maybe). The projected cost, $50B.
This is a fundamental problem which the free market cannot handle. It takes multiple years and billions for competitors to spin up. No sane bank or business person would try and get into cutting edge memory fabrication. That means the players we have are the players we'll likely always have (With MAYBE china entering the arena).
The free market only works when the required upfront capital for a new player to enter a business is relatively low. In industries where the players are static or shrinking, you have a free market failure.
But it is enough time for customers to consider competitors they may have avoided before.
So maybe their priced-out customers give Chinese DRAM a serious look, make some compromises, and never go back to Micron.
Someone will certainly take this bet - but it is a high risk one.
Where does he say he's going to make sure prices stay high?
- Oreo CEO, suggesting you to buy every Oreo you can get
Micron is working on increasing that supply. The started building a massive fab for DRAM in 2022 in Idaho. It should start production in 2027. They started a second massive fab for DRAM next to it in 2023 with production scheduled for 2028.
The CEO is saying that that is the situation we are in.
Demand has increased massively over a short time. Supply cannot increase as rapidly because for big demand increases it involves building new factories and equipment which takes significant time.
The CEO says that their new stuff will start coming online in 2028 but they can't forecast when supply will catch up.
or less, as you seem to forget what this whole discussion is about.
If they dont make sure the prices dont go up, they go up.
Once theyre up, and expected to stay up for the foreseeable future, competitors see a gigantic opportunity. Suddenly, the large amount of investment necessary to the ball rolling is worth it.
Once this opportunity is taken advantage of, the original market position of the company being able to freely set whatever price they wanted is eroded forever -- and in this particular case: it opens them up to being out-competed by the new competitor(s).
In this case those will will likely be coming out of china and be state backed, so theyll likely operate at a loss for maximum damage to get as much of the market as they can get.
in 5 years, Micron is likely going to go cry for state support to socialize their upcoming losses.
and before you say "but there are other competitors already": you should be aware that theyve previously been convicted of running a cartel. And the way theyve been behaving is exactly how they were behaving back then. While unproven, it is more then just likely that theyre still price fixing (and have been for years)
the price didnt just go up for consumers, they themselves have deeply dipped into the opportunity to maximize profits.
its so hilariously outlandish that eg SK Hynix has to pay out >$450k to union employees (per employee - not in total!) because they have a contract that a percentage of profits get shared as a bonus across the company. this payout is usually not particularly high.
the consumer price barely matters for the perspective of the company evaluating wherever they can enter the market, because thats just a tiny fraction of it. And the largest piece of the market buys directly from the producer, SK Hynex, Samsung and Micron.
For consumers wanting to buy RAM sticks the difference is academic, i give you that. But for the capital that decides wherever to invest millions if not billions into getting a factory up and running - the price they can set for the b2b sales is the more important factor.
If it wasnt already proven to be basically whatever number they feel like setting... the opportunity would be a lot less obvious.
The idea that companies should have priority price controlled access to memory puts us even deeper into a situation where we can never afford local compute ever again.
I actually like Clojure more but even with GraalVM AOT it still tends to take significantly more memory than even naive Rust code (e.g. using Clone everywhere). If you’re looking willing to spend time abusing the borrow checker you can often get memory usage down to like 5% of what you’d get out of Java stuff.
If the manufacturers decided to keep the price constant that would NOT stop the price that most people pay from going up. It would just mean that the people who managed to buy from the manufacturer before the supply ran out would resell on the secondary market for a giant profit.
But you've no evidence that that "giant profit" would be more than the increase that the suppliers would apply.
Arbitrage allows the market to find an agreeable price; a middleman arbiter with a warehouse of RAM has an incentive to agree a price with a buyer because he's stuck with that inventory if he doesn't shift it, and he has costs related to financing it.
A supplier has no such incentive, they can just jack the price up and if sales drop off they run the machines at a lower rate, or sack employees. But sales aren't going to drop off, because the baseline for demand has been lifted
Once this "RAM Crisis" is over, what reason would manufacturers have to reduce prices?
Literal empty shelves. And resellers on Ebay making bank.
If there's no competition entering the market, wouldn't that be a clear sign that this is not a free market but effectively a cartel?
More like 5-10
Hard to know who to believe, on one side there are the absurdly high prices and statements from companies and on the other hand there are strangers posting on HN that it's actually all fine.
The risk to any of the manufacturers, especially those with most market share, would seem to be if they are not all acting in sync. Micron's consumer brand, Crucial, had a great reputation, but now they have exited that business in favor or devoting all their capacity to currently higher margin products... will this come back to bite them later if they want to re-enter the consumer business?
The memory manufacturers have been through bubbles before.
I don't deny that AI is "real", in that there is certainly something there, but I would hate to be the guy betting billions or even trillions of dollars that we're not in a demand bubble well in excess of what is justified by that tech at the moment and expanding capacity is a great idea. Of course, I would also hate to be the guy saying "no we shouldn't expand capacity" when it turns out that, yes, we should have, but the staggering profits being made in the meantime would cushion that blow pretty well.
That's true. But will anyone have any money to pay for the LLMs? The AI market is currently being heavily subsidised by, ultimately, everyone else. But the economy in general is looking extremely dire at the moment, and that seems unlikely to last.
Can you elaborate on this? What about the economy is looking dire?
And from what I read in the media, a lot of the economic indicators are backing this up: discretionary spending is down, private debt levels are rising, etc. All signs that the slack in the system is disappearing.
From the bottom of my heart, I hope that's the future.
I'm not convinced that will be the case. The AI companies don't want you to have local control. They want you to subscribe to a service that they can change at any time.
I grit my teeth when I type this, but (god help us) I think Apple is maybe the best (least bad?) hope here. They are the only big player with the hardware chops and without a current vested interest in getting you addicted to monthly AI subscriptions. I'm not saying this is highly likely... I'm just saying that out of the current major players, they're the ones with the ability and motivation to move in this direction in the near future.
The next best hope is probably just nVidia or AMD catering to the consumer market once again, after the AI bubble bursts or the datacenter market reaches saturation.
The outside hope is that some startup makes a business out of burning open weight LLMs to silicon like ChatJimmy... although ChatJimmy was bought up by AMD AFAIK.
The relevant questions are: 1) Where are the economies of scale in the technology stack? 2) What's "good enough" to consumers, and how does that stack up with the relevant computing power needed? 3) What are the transaction costs along various system boundaries?
I think that the biggest force keeping inference in large centralized services is simply that provides a better product for the average user who doesn't care about local control (and the average user doesn't care about local control; indeed, for most people it's a misfeature, as then they have to administer their own hardware). HN is full of nerds that want to own their own stack; they're willing to put up with a little loss of capability to run Qwen 3.8 locally. But from the folks I know that have tried it vs. Claude vs. Codex vs. Antigravity, the local models are still pretty weak compared to what you can get by paying for a service. Most people will just pay for the service until the performance becomes indistinguishable and the price becomes less.
Micron would probably not even exist, or be a sticker brand for some Chinese conglomerate if not for this supply shock.
They are a lot more reticent this time around.
Whenever anyone does, there are dozens of posts acting conspiratorial on HN.
If only they were good conspiracies with some weight to them, but no, they fall apart if you have a rudimentary understanding of the subject.
They had built way too much capacity during the 90s and were losing money on every chip because they couldn’t run the fabs at full capacity. That’s why they colluded to increase the price to save their collective hides.
A new competitor wouldn’t be able to enter the market and lower the prices without also losing money. That’s not the case today, the Chinese are trying hard to do just that.
From what I have seen, it cannot. It has become foundational the same way Internet 1.0 (eg. Email, Static HTML, Web Directories, SSL) became foundational for a significant portion of the global economy in the 1990s and 2000s.
And these are supposedly the most brilliant corporations around, so other companies are seeing even less gain.
I stick with my theory that LLMs are GPU-like, not CPU-like. They will rarely solve a problem like an adept, but they can solve 1 000 000 million low-hanging fruit problems within a second in a way that there was just not enough eyeballs for before. They can also brute force problems.
It's a bit like the Sun/etc workstation market vs PCs, and high end expensive PCs vs cheap ones. Once the cheap PCs became "good enough" then they naturally dominated.
The interesting question is, why aren't other companies looking at this from the other direction?
For example, AMD now has a trillion dollar market cap. They make consumer and enterprise GPUs with integrated GDDR/HBM and have got to be looking at APUs that do the same going forward. They don't benefit from the price of their complement being high. They sold off their logic fabs at a point when they were half dead and had fallen behind, but you don't have to be TSMC to make DRAM. A large DRAM fab costs around $25 billion, i.e. 2.5% of their market cap. Why aren't they building two of them? Best case supply is still tight when it opens and they have a huge win, worst case the market has crashed by then but they still have a productive asset worth several billion dollars and paid for with cash from the time when it was highly available to them. And since they have internal demand, the amount the price would have to crash before the investment is a net loss is significantly more than it is for other companies.
Likewise Apple, Google, Amazon, etc. who have even more capital. What are these companies doing? They have the option to spend an amount of money they can easily afford to write off if it goes south, to get a huge win if supply continues to be tight.
It’s a known dilemma in farming. Your crops are losing, so you decide to switch them to crops that are profitable, but so do your six neighbors and by the time the new crops start producing, you have flooded the market and everyone’s losing again.
If anyone should do that, though, it's Apple. They have the money, the easy to predict need, the vertical integration in manufacturing. It could open all sorts of avenues for proprietary SoC to RAM interfaces. It makes a lot of sense for them to do.
Market cap is de facto capital because companies can issue their own shares.
> And for what, an historically low-margin commodity like DRAM?
How are they enjoying paying the "low" margins to the incumbents right now?
> They have the money, the easy to predict need, the vertical integration in manufacturing. It could open all sorts of avenues for proprietary SoC to RAM interfaces. It makes a lot of sense for them to do.
Which of those is supposed to not apply to AMD or Nvidia or, for that matter, Amazon or Google who are massive DRAM customers and also make the likes of Graviton and Axion?
And "proprietary interfaces" are essentially nonsense in this context. When a company comes up with a better way to connect DRAM to processors, the industry is more than happy to put it in the next version of the standard, which is what you want because it allows you to source the industry standard components in the event that your own facilities can't meet demand for any reason.
The primary reason companies use proprietary interfaces for things like this is when they're trying to capture the upgrade market, even then they're still typically using standard chips with a purposely incompatible connector, and Apple solders everything now anyway.
$50B for Micron.
> Why aren't they building two of them?
They don't have in-house expertise to do that.
$50B for Micron to build two fabs on the same site, i.e. they're still $25B each.
> They don't have in-house expertise to do that.
This is a questionable assertion to begin with. The skillset for designing logic and fabricating it are closely related enough that companies -- including AMD -- have traditionally done both, and companies like Intel and Samsung still do.
But more than that, what if they don't? You're not going to reassign your existing staff who are already doing necessary work anyway, you're going to hire new people.
The memory market isn't all that different, except it's even more capital-intensive. Roughly half of HN is convinced that the current AI boom is unsustainable even though the technology itself is amazing. So why should memory makers take the bullet here?
Ultimately, as much as this sucks, having an inexpensive gaming rig is not a human right. People with money decided that all that money should go to AI, and we have to suffer through the downstream consequences of that.
Simple and easy moves to start with.
Or perhaps they're thinking of nationalization, which leaves me a bit more skeptical.
I'm not opposed to markets, but this radical market based domination shit is getting old and it isn't benefiting anyone except the already wealthy.
Its pretty obvious that corporations are either unwilling or unable to reign themselves in or regulate their behavior in a way that benefits the majority of society. So we need to make the economy more democratic so it can actually benefit the majority of people.
Mind you, I don't think that's ever happening, considering that one such issue is there's currently nothing to keep a dishonest actor who ended up beyond that threshold from spending mountains of cash (still a small fraction of the total there) toward convincing those susceptible to such that a system which permits such dishonest actors is good akshyually.
It's probably not time to build a guillotine for the memory company CEO's and top shareholders but their behavior does resemble other more problematic moves. Consider United Healthcare denying claims in contradiction with their own policies just because they've realized they can get away with it. It has the same shape relative to the adjacent incentives.
Is this really a categorically different thing if we're talking about $85 million vs. $12 million?
Brazil and the UK (well, technically Japan) caused 2 natural rubber price spikes that first led to the UK smuggling rubber tree seeds to be imported to Malaysia, where the UK took over global natural rubber production, marginalizing Brazil.
Then Japan conquered the Malaysia during WW2, at which point everyone started developing artificial rubber and natural rubber was reduced to a much smaller market.
You could say that about pretty much any employee - and you'd be completely wrong. What makes you right in the case of CEOs and boards?
https://www.cnbc.com/2026/04/30/us-ceo-pay-grew-20-times-fas...
All the DRAM makers have new fabs or plant expansions underway right now - indicating they believe the demand increase to be sustainable.
Micron is putting up over $100 billion for this expansion wave IIRC. You can't afford that unless you are certain the increase in demand is sustainable.
You want to assure investors that investment will pay off so you want to talk up your order book and market outlook.
You also want to take as much profit as you can now so if things turn against you it doesn't mean bankruptcy. A pile of cash fixes many problems :)
The first two fabs there will require 17 million gallons per day of water and when fully operations in the early 2040s the facility will need 48 million gallons per day. That is more than existing infrastructure can handle so the project also includes a new pipeline extension to Lake Ontario.
That water requires extensive treatment before it can be discharged. It will be pretreated on site, then go to a new $1 billion industrial wastewater treatment plant being for this project, and then finally discharged into the Oneida river.
The energy requirements when fully operation are 1850 MW drawn continuously 24/7 every day of the year. That's 16 TWh a year.
For comparison that is a little above the annual electricity use of Ft. Worth, TX or Charlotte, NC, and little below Indianapolis, IN. It is about 14% under San Francisco, CA. A little over half of Chicago, IL, about 1/3 of Los Angeles, CA, and about 30% of NYC.
That's way beyond the existing grid capacity, so lots of infrastructure upgrades there are taking place.
Silicon Valley is littered with SuperFund sites of bankrupted companies who conveniently couldn't afford to clean up the toxic mess they left behind when they became the vessel full of debt after the corporate shell game moved on.
What happens now is that there are a large amount of studies, that pay consultants and organizations to generate thousands of pages of documentation. They then turn around, have some niche issues that they pay to go away. For example was Micron having to purchase a few acres of land 25 miles away as a park for some owls effectively helping stop superfund sites?
This is basically environmentalism security theater and political grifting.
Instead they want to build their 100 acre Data-Center/Technology Industrial Park adjacent to the burrowing owl habitats or up against Grandma Martha's backyard.
You didn't have to pay to cleanup a site before using it, because the expectation was that you paid while running your business and the site would be cleaned before you wanted to utilize it.
But now the "Superfund" has been underfunded for like 20 years. Biden's IRA set up a new tax for ten years but, not sure how well that's going.
We literally had the system set up well and working fine, but it cost companies a few dollars so it had to go when the "Greed is good" folks came along.
If I was trying so stabilize (just stabilize) funding for humongously expensive fabs: I'd be giving markets reassurances that my business will continue to be high margins for the mid-future.
And to build up a large amount of new capacity yourself, you need to invest a massive amount of capital into something relatively risky.
It wouldn't be surprising to also see Japan make a comeback in memory - they are investing heavily (both privately & government) in semiconductor manufacturing.
Without what the US government did and still does, the prices of memory would have never increased so much and all the world would not have been forced to pay so much for memory.
If that is true (and given the reasons you provide below, and the general quality of your commenting, I assume it is) then the situation is similar (if less militarized) to that of the oil sector, where the cost increase is likely higher by perhaps three orders of magnitude.
A few years ago, the US government has added the Chinese vendors of DRAM and of flash memory on their sanctioned entity list exactly at the time when Apple and other major computer manufacturers were evaluating the replacement of products from Micron and the like with the Chinese alternatives. This was prevented by the "sanctions".
There is absolutely no doubt that the so-called sanctions did not have any other purpose than removing the competition for Micron.
The official reason is absolutely ridiculous, i.e. that they are among the companies that provide products to the Chinese military.
If that would have been the reason, then 100% of all existing Chinese companies from any domain of activity would have to be put on the "sanctioned entity" list, because any of them would sell to the military of their country, if given an opportunity, like all companies from USA will provide products and services to the US military, given the opportunity.
While the Chinese memory makers will obviously also sell to the military, almost all their production goes into consumer products, like smartphones and laptops, which are the main products affected by the US "sanctions" (which are no true sanctions, because true sanctions against China would have been accompanied and conditioned by some political requests, which is not the case for any of the US "sanctions").
There is also no doubt that without the US "sanctions" the Chinese memory makers would have bought the latest semiconductor manufacturing equipment and they would have had the production capacity to flood the market with their products when Micron, Samsung and Hynix stopped providing enough memory for anyone who is not among their top 5 customers.
Thus their is no doubt that the US government has stolen a lot of money from my own pocket when I was forced to update a couple of old computers this year, by artificially restricting the amount of memory that is produced and preventing competition in this market.
As I see it, any US citizen who supports the actions of their government to restrict the production around the world of various kinds of goods and to prevent competition in various global markets, actions that have increased the prices of many kinds of consumer products in all countries, is an accomplice to theft from a very large number of people all over the world, who are forced to pay inflated prices for such products, resulting in money that goes from many countries into the pockets of the shareholders of a few big transnational companies, including Qualcomm, Micron, Samsung and Hynix.
I would guess that the reason for any downvotes is that even if what you wrote is completely true it isn't really relevant, because the current problem is not lack of competition. The current problem is a huge increase in demand over a short time.
Even if there were no restrictions on China and they had latest generation fabs, they would not have had latest generation fabs just sitting around idle. They would be unable to meet the current increased demand for exactly the same reason everybody else can't.
There are 3 companies
(Who said that we can only talk like a pirate one day a year?)
This “quarterly, short term” reddit-ism or internet-ism is baffling since the businesses that have earned the most money for shareholders (to the tune of trillions of dollars, eclipsing all other businesses), all have leadership making very expensive, very long term bets.
Yes? That doesn't mean they can't spend billions on R&D. If Apple didn't sell iPods like hotcakes, they wouldn't be able to R&D the iPhone. That doesn't mean nobody at Apple had long-term vision, quite the opposite.
How can business leaders and shareholders spend money on long term R&D and still be accused of focusing on the short term and next quarter? If they were focusing on making the next few quarters look good, they would reduce expenses, which include R&D, and make profits higher for the next few quarters.
>If Apple didn't sell iPods like hotcakes, they wouldn't be able to R&D the iPhone. That doesn't mean nobody at Apple had long-term vision, quite the opposite.
I can’t parse these statements. Are you or are you not claiming businesses like Apple and Micron shareholders are focused on the short term?
>If I can sell my things at a higher volume for longer vs higher price and less volume now, I'll go with the first, but not shareholders focused on quarterly numbers.
What if a business is maxed out on production capacity? What if a business can sell things for a higher price now, and sell things at a lower price later?
This is a very difficult supply chain in which to compete, even nation states mostly can’t. The machines that build the chips are really hard to come by and even China is just hoping they can start to make them in 2030 and they likely cannot. Meanwhile demand is accelerating.
History does not drop financial gifts like this in one industry’s lap often. From a sheer numbers standpoint, what they’re doing absolutely is the only logical choice.
Wouldn’t shortages produce basically the same incentive structure regarding competition or national security requirements? Like the demand for RAM is actually way up, so if they don’t raise prices enough the inventory will just quickly become depleted.
The three-headed A memory cartel should enjoy their brief moment in the sun. Because for the five years it will be over, and when I say over, it’ll be over for good…
This is exactly it. There's a lot of conspiracy theory in this thread without realizing that it's just what happens when an insanely large amount of capital is deployed: market distortion.
It's not just RAM, it's things like gas turbines and power transformers. I've seen suggestions that it's even affecting housing starts because the construction effort is pulling in workers, especially electricians.
However unlike you I'm not of the opinion that all that can be built, in that short timeframe. Even less so that it can be operated without pushing us over the 2C global warming threshold.
What does that even mean ?
The cost of AI itself (tokens/$ for a given level of intelligence) has been falling rapidly, and shows no sign of stopping.
The AI pure-play companies like OpenAI and Anthropic are presumably in worst financial position, since others like Google, Microsoft, Amazon and Meta (also Alibaba, Baidu, Bytedance, Tencent, Xiaomi) have generally been more conservative and are treating AI as an incremental revenue source not a highly leveraged all-in bet.
I think this is a point where governments should intervene and perhaps start fabs that would produce RAM at cost for working class and SMEs to use.
Or maybe they believe the demand is not sustainable, and they don't want to fund $10B ghost fabs.
The three greedy memory companies are changing the equations in tech industry and it won’t be in their favor in the long term.
The big problem is, competitors need money. Say a fab costs 10 billion $ a piece, that is a big chunk of investment needed that absolutely needs to be paid back because even a big bank consortium will have a hard time shouldering this kind of single risk.
Now, the fab needs around three years to build... which means if there suddenly comes a huge amount of new supply or alternatively, the AI bubble pops, prices will crash, the companies won't be able to service the loans, and the banks will be sitting on a very expensive piece of real estate and machinery.
Particularly in semiconductors, this "bust and boom" cycle, "pork cycle" or however you want to call it, is very very well known. Banks and other investors have been through that one more often than you can count, that's the reason why there are so few producers left after all.
The only place I think can reasonably pull it off to start a competitor is China because their economic policy is focusing on decades in the future and the CCP is willing (and able) to shoulder the risk - however China can't acquire EUV machinery due to sanctions and will likely take a few years until they can pull it off on their own, by the time TSMC et al will already be at the next generation.
It's starting to look more and more like we will always need more memory.