Read more.And a report says Adata, Phison and Team Group are considering up to 15 per cent price hikes.
Read more.And a report says Adata, Phison and Team Group are considering up to 15 per cent price hikes.
Probably a good thing I just splashed some cash on a Samsung 970 EVO+ 1TB SSD and 4x Samsung M391A2K43BB1-CTD 16GB ECC DDR4 modules. The price was so good I couldn't help myself, even though I'm not quite ready to build a new rig yet.
Or this could be a clever ploy to get people and companies to purchase more to clear inventory.
Isn't limiting supply technically price fixing by artificially restricting supply... why isn't anyone going after them like they have other companies in the past.
As mentioned in the article, how much market influence do Adata, Phison and Team Group really have? They could just end up pricing themselves out of the market with a stunt like this if others don't follow suit. Phison controllers are used by other companies but there are alternatives, but AFAIK ADATA and Team Group just brand end products, not any sort of IC in the supply chain?
Wasn't it lcd panels or something they went after a while ago, the prices didn't negatively affect the market because it was 'new tech' everyone was after it just inflated the prices for more profit. Same situation here, everything is going nand based these days so requirement is always going to be high, which in turn means there's no reason to restrict supplies to inflate prices.
Depends on market structure and price-elasticity of demand. If demand is "always high" (i.e. price-inelastic) then restricted supply will likely lead to increased prices as people compete to get product.
Of course, any company that restricts supply runs the risk of a competitor increasing supply to fill the void .... unless either the companies collude (which is illegal) or there are technical reasons preventing a shirt-term increase in manufacturing allowing others to fill the void.
It takes about 3 months to make new silicon, so if carefully timed you might be able to manipulate the market as long as you are sure competitors don't hold significant stock.
If they tried that and there was an oversupply looming that they didn't know about, it could backfire quite amusingly.
Isn't there currently a fairly significant case of oversupply in the memory markets though? Putting prices up when people are already not buying enough seems... interesting?
It's not price collusion to simply admit your profits tanked and it's time to raise prices before you bleed to death. Look at the last Q for MU, NVDA etc and you see they all took massive hits to NET INCOME. MU just had the worst Q in years. Time to raise prices if you are making near nothing now.
For instance, a year ago MU made 4.3B NET, then 3.2, 1.6, no under 900mil, and this next Q will likely be worse (MU management usually won't go into LOSSES, they'll adjust something to stay near break even until storm is over, one of my favorite parts of MU). At what point do you brainiacs think it's OK to say, "um, we're NOT going to lose money, raise prices so we at least stay in the black". You are stupid if you do not take corrective action in a situation like this. You start limiting supply and raise prices (this is normal). We constantly go from glut to shortage, hopefully they get close to predictions for growth etc, but when they get it wrong you get massive swings. From the whiners here (article included, what nobody can raise the price ever? ROFL), the second a company does well, "they've been ripping us off". Well, stop buying then. LOL. There is no gun to your head. If the market thought their pricing was stupid sales would tank. That is how free markets work IF you're all still buying, well, we call that a price the market will bear. I'm simplifying the term here, but you get the point.
There is no law that says you have to keep producing crap you are losing money on until bankrupt...ROFL. You limit supply if you're losing your butt per part. Only consoles don't do this, hoping they'll recoup losses over time on games (mobile too I guess, contract pays well over time).
They simply can win. It's a conspiracy, they are colluding to raise prices. No, it's a conspiracy to lower production! Wait no, it's a conspiracy to get you to buy more memory!...LOL. Or maybe management is just reacting to market conditions...DUH. Also note major PC shortages too, as Intel requires samsung & TSMC to help make 14nm chips. So again, market conditions should tell you STOP MAKING so much memory for PC's that can't be sold without a CPU! Dell, HP, etc have all whined about Intel and are now upping AMD boards/pc's. But that takes a while, and until then mem makers just pile up crap that can cost you a ton of money in the wrong environment. If you can't afford what you want, get a better job or quit complaining. Again, no gun to your head to purchase. Wait until it's priced like you want it, or buy something else entirely. It's not rocket science.
It is collusion to agree to raise prices with other companies i.e. price fixing. Memory is something of a commodity, and raising prices unilaterally as you suggest isn't really an option as pricing is dictated largely by the balance of supply and demand on the market - customers will just go elsewhere if needs be. Or do you think the memory manufacturers have willingly lowered prices to the point of slimmer profit margins?
A 'free market' still needs protections to prevent abusing monopoly positions, which are created even with multiple companies when they collude on pricing, something which has resulted in multiple massive court cases against memory companies for example. Adjusting production is one way of trying to balance the market if they're at the point of not being profitable, but that carries risks as such changes take a significant amount of time, and the market can be quite volatile, so in the event of swing to shortage for example, a company which reduced its production may end up losing out on sales, losing large contract customers, etc. It's a complicated, volatile market, and collusion/price fixing short-circuits that to become a win-win situation for the huge companies and a lose-lose situation for customers worldwide.
As for 'not buying then', that's a bit of a ridiculous suggestion when applied to memory products in 2019 isn't it? It's the sort of thing memory companies say, but courts tend not to agree! They are not exempt from anti-competition laws because 'there's no gun to your head'. 'Get a better job' is just an incredibly patronising load of drivel which betrays a drastic lack of understanding of the IC market, or economics in general TBH.
Nvidia have taken a recent hit to profits because the bottom fell out of the crypto market and Turning isn't selling as well as they hoped.
Consoles are far from the only thing to do loss-leading. It's not always legal but it happens a lot in the way of trying to push competitors out of the market, which in many cases is quite illegal but takes effort and time to prove, and by the time an outcome is reached, said competitor may have already left the market. There are plenty of examples of this, and the following court cases and fines etc.
Intel's shortages are largely down to their 10nm production delays. Their long-term plans would have expected 10nm to be well into mass production by now and capacity would have increased along with that. Instead, they have multiple fabs sitting idle, either new builds or conversions from older nodes, because 10nm still isn't yielding. Just to add to their problems, they've had to release multiple 14nm refreshes with larger and larger die sizes with increasing core counts, so fewer dies per wafer, placing even greater demand on the fabs they do have.
There are currently 1 users browsing this thread. (0 members and 1 guests)