
Memory Makers Plan to Cut NAND Flash Production - deafcalculus
https://www.anandtech.com/show/14275/memory-makers-cut-nand-flash-production
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reacharavindh
> three major manufacturers of NAND memory — Intel, Micron, and SK Hynix —
> have announced that they will be taking measures to address the oversupply

Isn't that illegal? To fix the market by colluding and price fixing?

How is this different from the act that Mercedes, BMW and VW are getting fined
for for colluding to not release emissions tech?

~~~
tooltalk
it's illegal if and only if it can be proven that they _coordinated_ their
production cut.

They all respond to the same changing market conditions -- they can't just
continue increasing their production when the price continues its downward
spiral. Further, the largest producer Samsung hasn't joined the foray yet
according to the article. Samsung is a big variable in this -- the company's
expansion created the memory glut that drove the whole industry to record loss
in 2015-2016.

The EU's antitrust authority claims that the automakers "coordinated"
strategies to limit competition. This is probably not the case here.

~~~
wnevets
>This is probably not the case here.

Why do we think that? Hasn't these companies and/or industry been caught and
fined for illegally coordinating their efforts before?

~~~
tooltalk
Well, one of the reasons is that that's what we've expected all along.

When Samsung announced a major expansion in early 2010's, many analysts
predicted the price glut in 2015-16 that followed. That memory price glut (and
a record loss by all industry participants) in turn discouraged capex by
memory makers that resulted in the 2017-18 boom we just witnessed. So now, the
windfall during the last boom likewise encouraged higher capex and production
increase that is now driving down the price and their bottom line again -- the
industry nearly completes a full cycle and is at another trough marked by
decrease in capex and production cut. There is really nothing too
conspiratorial about this business cycle.

Sure, I think every memory makers at one point got caught price-fixing, but
you can't just say they are colluding again just because they are all cutting
production under unfavorable market condition (ie, lower demand/falling
price).

~~~
wtallis
Another important contributing factor is how well the manufacturers do at
getting each generation of NAND to actually work. Samsung's 48L 3D NAND was a
relative failure around the same time that their competitors were trying to
get their first 3D NANDs working to overcome the limitations of planar NAND.
That kicked off a serious shortage, so when almost everybody came out with
successful, high-yield 64L 3D NAND around the same time, prices had a long way
to fall. The current moves are attempts to ensure that the transition to 96L
NAND doesn't continue the price drops.

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mikhailt
Questions: 1\. Can someone explain why this is not a clear cut of a collusion?
Didn't the same "cartel" get busted for this behavior a while ago? 2\. Why
aren't they under tight regulation since they have a history of doing this?

~~~
tooltalk
because there is no proof of collusion. Absolutely no need for any further
regulation.

~~~
mikhailt
[https://en.wikipedia.org/wiki/DRAM_price_fixing](https://en.wikipedia.org/wiki/DRAM_price_fixing)

They've pled guilty in the original DRAM price fixing collusion and they just
got sued last year for the same charge, it's ongoing.

I can only guess that laws are more lenient in Asia and they can only be
charged in US after the fact.

Edit: removed my opinion about getting sued again as that's off the topic.

~~~
tooltalk
> They've pled guilty in the original DRAM price fixing collusion and they
> just got sued last year for the same charge, it's ongoing.

Now you are making stuff up. We are in 2018, not 2006. There is no regulatory
investigation by any gov't antitrust agency. China's NDRC announced that they
had "massive evidence" of price fixing by Micron, Samsung and SK Hynix, in
2018. It turned out they had nothing, so instead they tried to blackmail
Samsung and SK Hynix to drop all pending and future patent lawsuits against
China's domestic companies in exchange for dropping a multibillion dollar fine
and antitrust violation that they couldn't prove.

You clearly haven't read the class-action lawsuit by Hagens Berman in which
the law firm alleges that the memory companies "coordinated" by signaling each
other via PR. Do you understand why the class lawsuit is not going anywhere?

~~~
mikhailt
Please provide sources to the NDRC case, that's why I asked in the first place
about why this isn't collusion. My understanding is limited to the original
2006 case where these companies were in fact charged and fined by Department
of Justice, that's not a made up story and I provided the source to that.

Telling me "no proof of collusion" without any source is the same as making
stuff up.

Technically, we're in 2019 but that's off the topic.

~~~
tooltalk
Google "china ndrc dram price fixing -digitimes"

If you are citing Wiki, you probably know very little about the older 2006
case. You seem to make haste assumption on what, how, and who are involed this
time around without any facts or understanding claims made by different
parties.

> Telling me "no proof of collusion" without any source is the same as making
> stuff up.

You are the one making accusation against the DRAM makers of price-fixing,
it's your obligation to prove your allegations. The burden of proof is not on
me to prove the negative (which is a logical fallacy).

~~~
mises
I am highly suspicious of China's motivation for this. It happened at roughly
the same time as news broke that the chinese stole Micron's technology. China
is not exactly known for good or fair practices, and it would not be the first
time they screwed over a foreign competitor and stole their tech to make a
competitor.

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solarkraft
Does this mean Intel's recently released high capacity SSD line (1 TB at 130€)
will become more expensive?

~~~
synack
Those drives are QLC (Quad-Layer Cell) which allows higher density at the cost
of long term reliability. Higher density means more bits per wafer, which
leads to lower cost per bit.

~~~
NullPrefix
This also means speeds of 80MB/s once you fill up the SLC cache which is 2GB
or so.

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tyopiuy
I would have preferred to see this happening to the dram cartel, who actually
did fix prices.

~~~
davemp
Micron and SK Hynix were/are apart of the DRAM cartel.

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areejs
Well they were loosing a lot of money over the falling NAND prices

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dmitrygr
All at once? Could be an accident but could be collusion

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microcolonel
Buy Samsung NAND, it's good and they keep making it.

~~~
Rafuino
They were the first to cut back supply. I'm guessing you work for them?

[https://www.techspot.com/news/79303-micron-follows-
samsung-r...](https://www.techspot.com/news/79303-micron-follows-samsung-
reducing-nand-dram-production-wake.html)

[https://www.bloomberg.com/news/articles/2019-01-30/samsung-p...](https://www.bloomberg.com/news/articles/2019-01-30/samsung-
profit-misses-estimates-as-chip-demand-slides)

