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DRAM Price Fixing Investigations

Posted by timothy on from the at-least-it's-still-cheap dept.

An anonymous reader writes "A few days ago after FTC antitrust charges against Rambus were thrown out, the U.S. Department of Justice and EU have both begun probes against the 4 largest memory makers in accusation of price fixing during 2001/2002. News.com.com has information regarding the pending EU investigation. Anandtech and Silcon.com both have primers on the U.S. investigation. If you thought you paid too much for RAM in 2002, chances are you may have been more right than you originally thought."

41 of 246 comments (clear)

  1. I need some clarification... by numbski · · Score: 5, Interesting

    I don't like paying high prices any more than anyone else, however I have to wonder...

    Let's say I have a monopoly on widgets, or myself and my compeptitors agree to keep the price of widgets artificially high.

    At what point are we no longer allowed to sell our widgets at whatever price we see fit? When do we cross over into breaking the law for price fixing?

    --

    Karma: Chameleon (mostly due to the fact that you come and go).

    1. Re:I need some clarification... by thelasttemptation · · Score: 5, Informative

      myself and my compeptitors agree to keep the price of widgets artificially high.

      That is where you cross the line

    2. Re:I need some clarification... by numbski · · Score: 4, Interesting

      So I can go sue Gillette for price fixing on razor blade refills?

      Or the printer manufacturers for price fixing on toner cartriges?

      You see what I'm getting at? When is it illegal?

      --

      Karma: Chameleon (mostly due to the fact that you come and go).

    3. Re:I need some clarification... by JayBlalock · · Score: 4, Informative
      Basically, at the point it could be shown that you all sat down together and decided, "Screw competition, we'll all sell the widget at price X."

      If you all independently arrived at price X as being the point you can reasonably profit when taken against manufacturing costs, it's legal.

      --
      Bush: He's Liberal in all the wrong ways.
    4. Re:I need some clarification... by hc00jw · · Score: 5, Informative

      When you agree with another company to both keep the prices high. This stops one of the companies in the agreement from undercutting the other to achieve more sells, and keeps the profit margins for both in the agreement (artificially) high.

      What you choose to do within your own company (razors, cartridges) is entirely up to you...

    5. Re:I need some clarification... by thelasttemptation · · Score: 5, Insightful

      Lets say there is a wendys and a burger king in the mall, bout 4 stores down from each other
      They are allowed to set the prices as they wish, and hence get into price wars from time to time
      This is all fine and dandy, until the two managers get together and say, 'You know what, if we agree to keep our prices at $2.00 per burger, we both will make more money.' At that point it's illegal.

      Gillette is not going with razorx and making deals nor printer manufactures.

      understand?

    6. Re:I need some clarification... by Pope · · Score: 5, Informative

      No, because in both cases, the company supplies both the product (razor, printer) and the refill (blades, ink cratridges). There's no collusion, since it's one company doing it to their own product, and therefore not illegal since there's no cartel or monopoly abuse, since there are plenty of razor and printer manufacturers to choose from.

      --
      It doesn't mean much now, it's built for the future.
    7. Re:I need some clarification... by Shakrai · · Score: 4, Insightful
      What you choose to do within your own company (razors, cartridges) is entirely up to you...

      Expect in those cases you have specifically designed a product that nobody else can make because if they do make it you'll sue them for copyright violation and/or DCMA violations. You don't have any motivation to lower your prices if nobody else has any motivation to make cartridges for your particular line of razors or printers -- mainly because they all have their own lines. If a third-party tries to make them you'll just sue them out of existence.

      This might not be illegal per say but it's just as bad imho. My ass it costs $35 to make a 15ml blank ink cartridge or $10 to make eight replacement cartridges for my Mach Three Turbo.

      --
      I want peace on earth and goodwill toward man.
      We are the United States Government! We don't do that sort of thing.
    8. Re:I need some clarification... by nelsonal · · Score: 5, Informative

      IANAL, I am an economist who enjoyed industrial organization a bit too much for my own good. It is only when you have meetings or evidence of collusion that you begin breaking the price fixing portions of anti-trust law in such a way as to invite prosecution. As long as your monopoly arises as a result of a competitive market (for handles and printers) you are not violating the law.
      The justice department generally tries to avoid procecutions for anti-trust violations, which are very expensive and prefers to regulate the market by barring mergers which would reduce competition. However there was a ton of case law generated on these subjects from the turn of the century through the 1970s when suits were more common.

      --
      Degaussing scares the bad magnetism out of the monitor and fills it with good karma.
    9. Re:I need some clarification... by hc00jw · · Score: 5, Insightful
      Expect in those cases you have specifically designed a product that nobody else can make because if they do make it you'll sue them for copyright violation and/or DCMA violations.

      Then that's a monopoly on that market... Which isn't in and of itself illegal. Prices couldn't be fixed in this case, because by definition, more than one party is required to fix the prices!

    10. Re:I need some clarification... by tsunamifirestorm · · Score: 5, Informative

      companies are given patents or copyrights for products that involve huge costs to develop. If it wasn't for copyrights, these companies would not make the initial investment because it would be significantly harder to earn back the cost if everyone could just copy your product.

    11. Re:I need some clarification... by LostCluster · · Score: 4, Insightful

      This is also why airline prices move in some strange waves.

      When there's going to be a price increase, one airline has to announce its increase to the world, they can't tell the competition first. Now, for a few hour, that airline is $20 higher than everybody flying the same route... who's going to buy tickets that route from that airline? Nobody. The ball is now in the court of all of the other airlines that fly that route... if they agree it's time for a price increase, they'll move their prices up to match. However, if a major player disagrees, they'll keep their prices where they are, and eventually everybody who raised their prices will realize this isn't going to stick, and the company that originally stated the fare hike will retract it.

      Fare cuts move the same way. Once somebody announces a cut, everybody else has to either match it or wait for the airline who made the cut to get locked out of the market by filling up their planes.

      That's how fair play happens without collusion. Those in charge of the prices have to guess what they other guys are going to do in the future, but once it's public information, everybody can use that info.

    12. Re:I need some clarification... by haystor · · Score: 3, Interesting

      Clearly it's your use of gas that causes the fluctuations. Bastard.

      Seriously though, for the in town prices being higher there are a couple reasons. The cost of operating on more expensive land works its way into the price. There may also be city taxes involved as well.

      As far as why it fluctuates from week to week, you should view the gas station as a very small futures market. They don't price the gas they have now based upon how much they paid for it. They price it based upon how much it will cost to replace what you buy. This means they are pricing your current purchases on how much it will cost them to buy gas a couple weeks from now.

      This means that if the political climate in the mideast flares up they may raise prices. If some nation bucks OPEC and produces more, prices may go down.

      I heard of a study that observed the prices moved up much more efficiently than they moved down.

      There are also seasonal differences in the composition of gasoline which is actually a mixture of lots of chemicals. This, along with a greater demand makes gas in the summer more expensive.

      --
      t
    13. Re:I need some clarification... by Golias · · Score: 3, Informative
      Gasoline is a loss leader in most places these days. A "Super America" can make a penny a gallon, or even take a small loss, and make it up by selling you a $0.50 snickers bar for a $1.00, and a "Big Gulp" cup of inexpensive sugar-water for $1.49. Their "Supermom" bakery products are also a huge cash-cow for them.

      Other gas stations make their money from maintenence and parts, or cigarettes, or deluxe car washes... you get the idea. Ever notice how few gas stations that only sell gas are left? That's because there's no money in retailing the gas itself anymore.

      The prices are almost always within a penny or two of each other in a given neighborhood because the fuel itself costs them all about the same ammount. Also, they look up and down the road each morning to make sure nobody is undercutting them too drastically.

      --

      Information wants to be anthropomorphized.

    14. Re:I need some clarification... by jdifool · · Score: 3, Informative
      because by definition, more than one party is required to fix the prices!

      If I remember my economics correctly, this is not true.

      The competition between various economic entities just lower the prices, until reaching in perfect competition the cost of the last unit you will produce (marginal cost). But a monopoly can just fix the price, then swallowing a part of the customer saving, and wasting a part of the overall income (because fixing the price higher is just taking away some money the customer would have saved otherwise, and because raising the price automatically lower the quantities sold, thus triggering what has been called the Dead Weight Loss). It's really hard, actually, to determine how a price is fixed. From a neo-classissist point of view, which is probably one of the wrongest one, but probably the less disturbing one too, it is the value of how much work you put to produce that unit (FIXME if I'm wrong).

      So, indeed, competition is good for pricing, but monopolies and oligopolies (?) are present, and sometimes justified when they are selling public goods with strong scale savings, in economic sectors that require huge investments (plane construction, water, electricity, etc.).

      Monopoly isn't, as far as I know, forbidden in itself. This is preventing other companies from entering your market that is strictly forbidden (such as lowering the price so that new companies just can't bear the investment costs at such rates, or fusionning, or agreeing to keep prices high, or...)

      And the original question is well valid, because when examining the legislations, you just notice that public goods monopolies aside, trials were intented when companies infringed on the very interest of the government, and when the government *could* have a chance to make those suits become effective.

      Just to add my 0.002$, didn't you wonder why you just can't know how much you will pay your plane ticket, depending on when you buy it, from where (internet, phone, cashier) you buy it, and from which social class you belong ? It's just because those companies make their best to make you pay the max price for your ticket. Some very precise microeconomics studies are made to understand how much you are ready to pay for this seat on this plane. And this why, when you discuss, you can find people next seat who paid 30-50% more than you. For just the same crappy food, and tight seat...

      This is the power of business ! :)

      My economics english is bad, I know it. I never used such terms. Sorry...

      Regards,
      jdif

      --
      Let's overcome our weakness.
  2. Whee! Here comes another check... by Anonymous Coward · · Score: 5, Funny

    ...for ~$5.48, from some RAM manufacturer. In 2007.

    Man, I just deposited my $13.86 RIAA check yesterday.

    If the money keeps rolling in like this from Big Greedy/Evil Organizations, I may quit my day job.

  3. I remember when 64MB of RAM was $1000 by 0x0d0a · · Score: 3, Insightful

    Man, memory seems so cheap these days. If it was being fixed before, I can't imagine what it'd be like without price fixing.

    --
    May we never see th
    1. Re:I remember when 64MB of RAM was $1000 by WinDOOR · · Score: 3, Interesting

      Yeah and paying $250 for a 16mb Toshiba laptop dimm from CompUsa because it was the only place I could find it. Memory should still be going down in price, but it isn't. I bought 50 sticks of 128meg PC-133 for about $16.00 a stick in '02. Can't buy it for that now.

    2. Re:I remember when 64MB of RAM was $1000 by grub · · Score: 5, Funny


      I realized this was happening years ago. My solution? Run with just 16 MB of RAM and a 4 GB swap partition. Sure, my machine gets a bit pokey but it keeps the cartel from stealing my money.

      Ahh, my 'ls' from December just finished!

      --
      Trolling is a art,
  4. Cheaper memory? by Anonymous Coward · · Score: 4, Funny

    Will this lead to cheaper RAM? I hope so, because I really need more... um, what's it called?

  5. Uhh...no by Pingular · · Score: 5, Interesting

    If you thought you paid too much for RAM in 2002
    I paid 70 for a stick of 512mb in 2002. That may be expensive compared to now, but with my first 486 I paid the same price for a 4mb stick. Unless you own a server farm, what's 10 per half a gig or ram?

    --

    When anger rises, think of the consequences.
    Confucius (551 BC - 479 BC)
  6. Price fixing lawsuits are hard to try..... by ghettoboy22 · · Score: 5, Interesting

    Saving my mod points....

    While I'm willing to give any company the benefit of the doubt, it does seem rather suspicious that Micron chose to sell off their PC arm and focus instead on, the implied, more lucrative memory manufacturing business line. Circumstantial yes, but it never made sense why Micron would sell of a business line that was the only good alternative to Dell.

    That being said, it's really hard for the DoJ to prove a conspiracy existed to fix prices of memory between manufactures. IANAL, however from my understanding basically a "smoking gun" would be the only way a conviction could be had - some emails between companies discussing price or marketing strategies perhaps. Other than that, it's almost impossible to get a price-fixing case with a favorable outcome for the prosecution.

    1. Re:Price fixing lawsuits are hard to try..... by PalmerEldritch42 · · Score: 5, Informative
      it never made sense why Micron would sell of a business line that was the only good alternative to Dell.
      Um, maybe because they were not a good alternative. My company used to use all Microns for a few years. They all sucked when we bought them, and very few of them are still in use now because they have crashed, and it was cheaper to replace them then it would be to repair.

      We have since gone to Dell, which are admittedly more expensive, but they work properly and have good support (though lately G'nesh Singh Bhudanaramading keeps answering the phone when we call- we never know what he is talking about, but when a new network card appears the next day, it usually fixes the problem...)

      --
      Ceci n'est pas une sig.

      :wq!

    2. Re:Price fixing lawsuits are hard to try..... by HardCase · · Score: 3, Interesting
      While I'm willing to give any company the benefit of the doubt, it does seem rather suspicious that Micron chose to sell off their PC arm and focus instead on, the implied, more lucrative memory manufacturing business line. Circumstantial yes, but it never made sense why Micron would sell of a business line that was the only good alternative to Dell.


      Micron owned ~60% of MicronPC. The business was losing money at a fantastic rate and shareholder pressure was on Micron to divest itself of businesses that were not part of its core competency. MicronPC itself was straying well out of its own core business by operating a rather poorly-run Internet services company, as well as making a huge departure from its niche of being a no-compromise performance PC company. MicronPC was a terribly mismanaged company.


      Micron either sold or closed a number of other businesses as well. The company used to be in the construction management business, RFID business, flat panel display business and property management business. They even manufactured semiconductor processing equipment. The problem was, though, that the company was a semiconductor manufacturer. During the dot bomb days, that was well and good, but, like many other companies that strayed from what they did best, when the bubble burst, Micron was stretched a little thin.


      But, to the point, Micron did not sell MicronPC. They donated their entire holdings to the Micron Foundation. MicronPC "sold" (and by "sell" I mean that they paid Gores to take the business) the computer business to a turnaround company and merged with Interland to further its ISP business.


      It's possible that 6 or 7 years ago MicronPC was a good alternative to Dell, but, up until a year or so ago, that certainly wasn't the case. As soon as MicronPC started trying to directly compete with Dell, the company began tanking. The product quality suffered tremendously and the company simply didn't have the management quality necessary to make the jump from a niche manufacturer to an industry giant. It's interesting that in the past year, MPC is now making a profit and building a focused range of no-compromise systems...much as it did in the early days.


      Micron Technology recognized what was happening at MicronPC years ago and pretty much turned its back on MicronPC quite a while before the company split up.


      -h-

  7. Toner and Ink by nycsubway · · Score: 5, Interesting

    I'd like to see the price of toner and ink cartridges go down. Those things seem so simple, I wonder why they are so expensive. A memory chip seems slightly more expensive to produce than an ink cartridge. Yet the prices are very similar.

    --
    http://github.com/gbook/nidb
  8. Anti-trust can bite my ass... by stevens · · Score: 4, Insightful

    I've read cases where the same laws have been used to prosecute companies no matter what they do:

    • If you set a price lower than your competitor, you can be accused of "predatory pricing"
    • If you set a price higer than a competitor, it is used as evidence of an "abusive monopoly position"
    • If you set the same price as a competitor, it is evidence of "price fixing"

    A law that you can't know you're breaking in advance is no law: it's a license for prosecutors to go after anybody.

    1. Re:Anti-trust can bite my ass... by JayBlalock · · Score: 5, Informative
      If you set a price lower than your competitor, you can be accused of "predatory pricing"

      If you price your product BELOW COST, you can be accused of predatory pricing. Without this rule, no small manufacturer could ever reasonable compete against an established one. The one with the large market share would simply undercut the competition by selling at a loss and ride on its existing resources until the competition went under. If you set a price higer than a competitor, it is used as evidence of an "abusive monopoly position" Only if coupled with other factors, such as anti-competitive \ exclusive contracts with related parties. Case in point, Microsoft's contracts with computer OEMs preventing them from bundling other OSes on the same computer as Windows. BeOS - overall, a superior product - went under because of precisely this. They had no chance to compete and prove themselves on an open market because of Microsoft's restrictive contracts. (which, in turn, no OEM would break because of Microsoft's ownership of the home market)

      If you set the same price as a competitor, it is evidence of "price fixing"

      CAN be, but only very rarely. As was pointed out in another post above, price-fixing \ cartel cases are spectacularly difficult to prove and usually require a "smoking gun" as evidence. The government even launching such a case is itself evidence that they have a load of proof on their side. Otherwise, it's assumed to be the result of normal market pressures. (why, for example, all the major computer brands cost about the same - prices have trended downwards since the 80s until it's hit a point that it's extremely difficult to get any cheaper and still profit. That's not price-fixing, it's the Free Market actually working as it's supposed to.)

      --
      Bush: He's Liberal in all the wrong ways.
    2. Re:Anti-trust can bite my ass... by Geek_in_Marketing · · Score: 3, Informative

      Usual disclaimer - IANACL (I Am Not A Competition Lawyer.

      However, I have been involved in training and training others on competition and competition law.

      You're not quite right in saying the same laws are being used - it's the same overall competition legislation, but the three cases you've mentioned relate to very different clauses and laws within that legislation.

      I can't speak for the US, but in the UK it's basically like this. . .

      1. You can only be accused of predatory pricing in a specific circumstance - namely when you are in a monopoly position and therefore able to sell your product or service at such a low price as to force competitors out of business. For example, a software monopoly would be breaching this if they sold their office suite for next to nothing. Often, the key is whether the company has sold for below their cost.

      2. You already said it. You can only abuse a monopoly position when you are IN a monopoly. That can't be said to be the case here, realistically.

      3. Evidence of 'price fixing' is not just a matter of "your price is the same as your competitor, you're nicked chummy!".

      In the UK, an in inquiry would be started by the OFT after complaints had been made regarding potential collusion or cartelling. The OFT then has the power to raid the offices of any company being investigated, and remove anything - anything at all - that they deem pertinent to their enquiry. I've seen case studies where the diaries of sales management were used to prove that there had been a meeting to agree price fixing.

      So in summary, the first two instances can only be invoked when you are in a dominant position in the market while the third can apply to any company.

      It's worth reading the UK Competition Act - it mirrors EU legislation on the subject and may expand on precisely what the EU are going to investigate and how. Apologies for the lack of a link, but I hope this clarifies things a bit.

      --

      "This is your life - and it's ending one minute at a time" - Narrator, Fight Club
    3. Re:Anti-trust can bite my ass... by LostCluster · · Score: 3, Insightful

      Say what?

      If you set a price lower than your competitor, you can be accused of "predatory pricing"
      Only if you enter a market with a price that's below cost with the intent of raising your prices once you've knocked out your competitors.

      If you set a price higer than a competitor, it is used as evidence of an "abusive monopoly position"
      Huh? If you have a competitor, you can't abuse your monopoly because you don't have one.

      If you set the same price as a competitor, it is evidence of "price fixing"
      Price fixing can't happen if the prices aren't even, but there's still more that needs to be proven. Is there an under the table agreement to keep the prices where they are? If so, that's price fixing, if not, then that's just the free market having agreed on a price... any player can try to deviate from that price if they want to, but moving up would mean less market share, and moving down would lower profits in a way that wouldn't be made up by the volume.

  9. Market fixes itself in this case by Brahmastra · · Score: 5, Interesting
    In April 2002, Michael Dell said that his company, PC maker Dell, began to buy memory from second-tier manufacturers to avoid cartel-like behavior of some memory makers. Why is price fixing by a few manufacturers a concern when alternate vendors are available? It's a problem only if the price fixers are the only vendors. The market is fixing itself. If Dell buys from the 2nd tier vendors, the price fixers have to ultimately lower their prices.
    1. Re:Market fixes itself in this case by JayBlalock · · Score: 3, Insightful
      Well, that brings up the larger issue of whether 'no harm, no foul' is a valid legal concept. And we've been wrangling over that one for millenia.

      The alternative point of view would be to say, at the time they (allegedly) did this, they obviously felt that this illegal act would bring them higher profits. That the market would shift to deny them their profits could not be forseen. So at the time, it was an illegal act with the intention of garnering ill-gotten gains. (allegedly)

      While I can see your position, from a larger societal standpoint, I can't support only prosecuting cases of illegal acts in the event that they succeed. Taking that standpoint would, in some ways, encourage illegal (AKA antisocial) actions, since the odds of being caught and punished suddenly go down.

      --
      Bush: He's Liberal in all the wrong ways.
  10. Prices in 2002 weren't bad by DangerSteel · · Score: 4, Funny

    Compared to say about 1994-1995 I believe. I clearly remember paying $308.00 for an 8 meg simm. That was 8 times more memory than my first pc had so it was worth it !

  11. Too Bad About Rambus by stevesliva · · Score: 5, Interesting
    I thought the FTC complaint against Rambus would have set a great precident. Basically Rambus participated in standards development for DRAM technology and ensured that the standards would include technology infringing on Rambus patents without disclosing those patents. Rambus then withdrew and began suing every DRAM maker in sight.

    SCO is doing just about the same thing as Rambus, but with much less success. Participate in Linux/UNIX standards groups, but later claim to own those standards and begin suing everyone.

    --
    Who do you get to be an expert to tell you something's not obvious? The least insightful person you can find? -J Roberts
  12. so, class action lawsuit soon by fireduck · · Score: 4, Interesting

    Class action lawsuits are becoming my new favorite pasttime. Consider:

    In the past month, apparently I've been involved in at least 3 class action lawsuits. Both my wife and I got checks for $13.86 from connecticut's part in suing the record labels over overpriced CDs. Both of us have gotten paperwork regarding whatever claims are against Microsoft and software purchased in the late 90s (couple window versions, offices, etc.). I just submitted something for a company who were apparently inflating their stock value (or something) while I owned a number of their shares. And I can't even recall doing anything to get involved in the lawsuit to begin with. That's the best part. Christmas in March. I love it.

    So, when are the consumers going to sue and and how do I convince the authorities to go after Corsair, as that's the only memory I purchased in that timeframe?

  13. My dad talks about.... by ForestGrump · · Score: 4, Funny

    Back in the day when ram was little doughnuts, and it cost its weight in gold...

    Back in the day when punch cards were book marks...

    Back in the day when minimum wage actually kept you alive...

    Back in the day...

    -Grump

    --
    Is it true that more people vote for the winner of American Idol, than vote for the president? -Ali G.
  14. price of memory stuck for two years by peter303 · · Score: 5, Informative

    Commodity DRAM memory has been around $0.10 / megabyte since 2002. I remember slashdot stories about $100 gigabytes at that time. Until Wintel breaks the 2GB/32-bit limit the core memory cost is not a major factor in personal computing. in contrast, flash memory has fallen from $1.00 to $0.25 that time period.

    The price plateaus when a chip generation matures. The next 4x generation seems a bit delayed.

  15. Racing to the bottom by Anonymous Coward · · Score: 5, Insightful

    I'm no longer in the standalone DRAM business, but I did spend about 20 years, there.

    Much of the time, there's no money to be made. Much of the time, just about everyone runs at a loss. The industry is also cyclical, and sometimes there's good money to be made. It doesn't help that it takes serious time to build a chip, so build-to-order doesn't really work very well. There's also time involved in packaging chips into a usable form, especially because it may involve transportation to a remote site. This aspect may be key, later.

    IF there is price-fixing involved, and I suspect that there really isn't, it's the general idea of flattening out the bottom of the price curve a little in the cycle. I suspect it's far more likely that memory makers have decided, "It's just not worth bringing memory to market for less than $xx.xx." Remember the thing about packaging? At some price point, it may be better to not even bother packaging chips. It may even be better to grind them back into sand. Each manufacturer has different costs, but they're all doing the same thing. I suspect that they all have different, but similar package/hold/destroy price points for their chips.

    This might appear to be price-fixing, but isn't. It's simple economics.

    Years back, I bought my Mom a pair of earrings made from defective 4Mbit chips I had worked on for 6 or 7 dollars. At the time, perfect chips were selling on the open market for $4.50.

  16. Maybe big brother should investigate microsoft. by jason.mitchell · · Score: 3, Interesting

    If you think maybe 200 dollars for a peice of actual hardware is bad, they might want to start looking into software like windows trying to sell $1,000 for microsoft windows xp. Atleast you can actually hold the ram in your hand and be like "yeah! I have ram in my hand."

  17. slight flaw... by interactive_civilian · · Score: 3, Insightful
    I see a problem with this:
    companies are given patents or copyrights for products that involve huge costs to develop.
    I'm gonna have to disagree with this...at least for the copyright part.

    A creator is granted copyright on something the moment that it is created regardless of whether the creator is a company or an individual or whether it took lots of money/effort or almost none to create.

    Copyright is granted to give the creator a chance to make money from a creation, but the lack of such "return on investment" does not necessarily stifle creation..."Art for art's sake" and all that...

    A bit more to the topic at hand, it does sometimes seem quite wrong that a copyright/patent holder can simultaneously price gouge the customer and prevent others from sometimes even mimicking the product and sell it at a lower price...I can understand patents on products that are quite expensive to develop, but as the grand-parent post said, razor refills and ink cartridges?...c'mon.

    Actually...I guess I am somewhat split on the topic. On the one hand, as a creator (photographs and sometimes music) I can understand the desire to control how a creation is used, but on the other hand, as a consumer I would really like a cheaper product. There must be some kind of balance in there, right? Or must everyone be a profiteering glutton?

    --
    "Empathise with stupidity, and you're halfway to thinking like an idiot." - Iain M. Banks
  18. The law applies, but not the intent of the law by microbox · · Score: 4, Insightful

    We all understand why patents are necessary... so you're 100% correect but there's a big problem with the law

    If you don't believe me, then look at the profits HP makes on selling printer refills compared to _all_ of it's other business wings combined. (over half the total revenue). The fact that all printer manufactors engage in the same policy can be regarded as a new way around the price fixing problem.

    Lets face it, the industry is deliberately vendor locking their customers and then charging ridiculous prices. Mum and Dad get sold on a wonderful printer that costs only $150, but then sigh in resignation when the salesman tells them that _all_ the ink cartridges are very expensive.

    So they get around price fixing charges by all producing different (but functionally identical) components and over charging for them. Seems like the price fixing laws need to be fixed.

    --

    Like all pain, suffering is a signal that something isn't right
  19. Not really by bluGill · · Score: 3, Informative

    Stations have looked at it. Turns out the people who use the pay at the pump are the people who would only buy gas anyway (often with the same credit /debit card that skims ~3% off the sale price), while those who buy the stuff inside go inside and buy it anyway.

    With pay at the pump the don't need a clerk ($) to ring up sales for those who are only buying gas. Clerks costs money, if you can get by on one less clerk because of pay at the pump you are saving 5 bucks and hour. That adds up fast.