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

The arguments made by the Plaintiff are thoroughly convincing to me. The fact that those 8 points are not enough to convict indicate the industry is fucked. Of course the defendants didn't leave a paper trail - they've already been convicted of collusion before.

It's the people and country that suffer when our government fails to ensure markets are free and fair.

It's been happening once every decade or so. I'm not surprised that they are being sued again.

I thought the title missed the year (in parenthesis)

There's "fat margins" and then there's the kind of margins that tech industry shareholders expect.

OpenAI's original corporate agreements capped its returns at 100x, which is seen as too paltry for its current holders, so they scrapped those to prepare for an IPO [0]

That is, in a word, insane.

[0] https://abhs.in/blog/openai-for-profit-conversion-ipo-develo...

>But god forbid if someone else captures the margins and squeeze them out of easy profits.

Yeah that's how law works. Everyone likes money, but that doesn't mean it's fine to steal money. Yes, even from maligned entities like "big tech" or "private equity"

Switching off DDR3 manufacturing I can understand, but DDR4 machines are still quite relevant and usable… Ryzen 5000 series boxes for example don’t feel meaningfully weaker than they did when new. My 5950X tower certainly doesn’t, and it’d really be nice to be able to upgrade its RAM should I need to because it will continue to be useful for quite some time.

AMD just re-released their 5800X3D for AM4 board users who wish to upgrade which is further evidence that shutting off DDR4 production is premature.

Dropping DDR-4 is anything but meaningful. It'll easily last 10 more years, machines from this gen are still much more affordable and quite powerful. In fact for most dev and gaming workflows the difference between the DDR-4 and DDR-5 generation of hardware is more or less negligible. I am exaggerating a bit -- but really, not too much.

Of course it might be a ploy to sheep-herd consumers and companies towards the expensive DDR-5. I would not put that below the ring of RAM producers.

It's easy to see why your argument is wrong with a simple hypothetical: what if they were still making DDR4 today? Would people still buy it?

The answer is an obvious "fuck yeah", even if you ignore the DDR5 price gouging. People will buy it because people still have DDR4 hardware, and that hardware is still extremely relevant.

So if there's a market for it, but none of the suppliers are trying to sell to it... Wtf is happening? Basic capitalism logic says any rational supplier would sell DDR4 for easy profits, meeting an unmet demand. That it isn't happen points to some kind of collusion, IMO.

>It’s made outside of the US using non-American tooling.

Depends if US can demand ASML which uses plenty of US tech inside. In reality even the DRAM and NAND supply chain has plenty of US technologies.

And you say Micron are US but they have lots of Fabs in Japan as well since they acquired Elpida.

> 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 would lose access to their largest market, I'm sure shareholders would havesomething to say about that ?

Arbitrage?

US is the vast majority of their market - Apple, hyper-scalers, AI labs

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

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 specialty and barrier to entry.

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

And our illustrious leader doesn't tariff Chinese RAM and allows its sale in the US.

And replace all your apps with some horrible Tcl/Tk and .NET interface?

Nobody ever made good native widgets.

>keep supply as low as they want and allow the AI companies to spend hand over fist

That's indistinguishable from not wanting to get burned by another semiconductor boom/bust cycle.

In reality a lawsuit needs to have some basis. The bar might be low but judges frown on having their time wasted with a truly frivolous claim or a claim with no clear damages or harm shown.

Honestly a lot of lawsuits feel like they just want the other party to pay them (settle) to make the lawsuit go away, even if there is no case; what are the repercussions for a frivolous lawsuit?

> Price fixing is legal as long as your are doing it in the open.

In the U.S., competitors are allowed to act in similar ways in response to economic realities, as long as they each arrive at that decision independently. But publicly anchoring your price to a competitor’s is potentially illegal.

> Price fixing is an agreement (written, verbal, orinferred from conduct) among competitors to raise, lower, maintain, or stabilize prices or price levels.

[Emphasis added]

https://www.ftc.gov/advice-guidance/competition-guidance/gui...

>Price fixing is legal as long as your are doing it in the open. In the UK it is called "price match" and eg. if supermarket says they keep prices matched to their competitor. No regulator raises an eyebrow.

No, the key term is "collusion", which could be done in the open or not. If a competitor told you they were unilaterally raising prices in secret, that would still be legal. Where you get into trouble is if you are cooperating to set prices. And no, this is all determined by a judge so cute workarounds like "I'm telling my competitors that I'm raising prices then gauging his body language" won't work.

That is not what price fixing actually is. In the UK "price matching" is a one-to-many relationship meaning that the price of goods is set to the "lowest available"

Price fixing is a many-to-one all the manufactures agree to the highest prices they all agree on and set it there.

Price match creates downward pressure, nobody is gonna sue over lower prices.

This is like if you showed a supermarket that their competitor's oranges were more expensive, and they "matched" by raising their prices for everyone.

That’s a nice short-term solution. How do you envision adding an infinitely-deep-pocketed state-sponsored supplier to the mix over the longer term?

cxmt is also selling their memory similar to the big three. No one hardware company in their right mind will sell their products not as high as possible after you learn how much harder hardware engineer and fab people work for.

There is no reason for there not to be a price fixing. But the OpenAI's announcement from 2025-10-01 about buying 40% of supply, removes any need for collusion. It was a public signal for everyone to rise prices, one that each company could figure on their own. And it will be very hard to prove otherwise.

Two things can be true; they could theoretically make agreements to limit supply, like the OPEC does to exert control over international oil prices. But the OPEC is all above board and there's plenty of international competition on the oil market.

But the challenge is in proving it.

Prices skyrocketing create a perfect opportunity to slip in a little artificial bump and hope everyone blames the market. See also: egg prices in 2024.

if demand is too high, the market will adjust by adding supply. If Apple can't take the price of memory, why don't they make memory themselves. Oh no, the technical and manufacturing know-how is a barrier to entry and there is no talent available to make it. That is memory or semi companies' competitive advantages and their pricing power. It also takes Phd degrees to work at hardware companies. You can't have people doing leetcode for 2 months and todo apps and getting into the field and make 300k a year and hardware engineers wih Phds making 100k before this boom. It is long overdue for a rebalance of pricing power between hardware and software companies

> An agreement to restrict production, sales, or output is just as illegal as direct price fixing, because reducing the supply of a product or service drives up its price. For example, the FTC challenged an agreement among competing oil importers to restrict the supply of lubricants by refusing to import or sell those products in Puerto Rico. The competitors were seeking to pressure the legislature to repeal an environmental deposit fee on lubricants, and warned of lubricant shortages and higher prices.

https://www.ftc.gov/advice-guidance/competition-guidance/gui...

hmm maybe the plaintiff should sue nvidia?