The world’s three largest manufacturers of random access memory (DRAM) are at the center of a lawsuit. Samsung, SK Hynix, and Micron are accused of colluding to regulate supply and artificially inflate prices in the market.
The world’s three largest manufacturers of random access memory (DRAM) are at the center of a lawsuit. Samsung, SK Hynix, and Micron are accused of colluding to regulate supply and artificially inflate prices in the market.
As reported by VGC, a group of individuals and legal entities filed a class action lawsuit. The authors of the appeal claim that the actions of the technology giants, which control almost the entire global DRAM market, have led to a large-scale crisis, which the media and industry circles have already dubbed RAMageddon.
According to the case materials, manufacturers have coordinated to reduce the supply of traditional DDR3 and DDR4 RAM. This has caused a sharp increase in prices for end users. Instead, companies have focused their resources on HBM (high-bandwidth memory) — an expensive type of 3D-stacked DRAM, which is currently in huge demand from AI data center operators.
«DRAM oligopolists simultaneously reduced production, coordinated the transition to HBM and the abandonment of DDR3 and DDR4, and in other ways reduced and restricted the supply of traditional DRAM, while prices increased at a staggering rate and scale,» the lawsuit states.
The plaintiffs point out that in a healthy competitive market, such a price increase would be instantly balanced by an increase in supply from other players. However, in the DRAM market, the barrier to entry for new competitors is virtually insurmountable. Construction of a modern factory costs tens of billions of dollars and takes years. In addition, key technological processes are protected by trade secrets, and strict US export restrictions make it impossible for alternative manufacturers, particularly in China, to obtain advanced equipment.
Due to the artificial supply restriction and the crisis in the component market, not only ordinary users of the PS, but also consumer electronics manufacturers have suffered. For example, Microsoft increased the prices of its Xbox consoles by $100 to $150, Apple adjusted the prices of its entire hardware line, and Valve Corporation was forced to reconsider the pricing policy of its Steam Machine portable devices, since the initial goal of making the device as affordable as possible became unrealistic. The price increase also affected consoles from Sony and Nintendo.
