Slashdot Mirror

← Back to Stories (view on slashdot.org)

Infineon To Pay $160 Million For Fixing RAM Prices

Posted by timothy on from the long-running-saga dept.

Jerrod K writes "Infineon Technologies pleaded guilty to charges of price fixing in an international conspiracy. The Justice Department said this is the third largest antitrust settlement ever. Other memory chip makers involved include Hynix, Samsung, and Micron Technology." Reader phalse phace adds a link to CNET's coverage.

37 of 356 comments (clear)

  1. Sweet. by rincebrain · · Score: 5, Interesting

    Does that mean I can upgrade my RAM for less than the cost of a new processor now?

    I mean, seriously. The prices were ludicrous for high-end manufacturers, and the low-end can sometimes die, and you have no recourse.

    Huzzah!

    --
    It's only an insult if it's not true.
    1. Re:Sweet. by Jason1729 · · Score: 4, Interesting

      Compare the transisitor count in a 256 meg DIMM to a CPU. That's 2 gigabits and a minimum of 1 transistor per bit, so at least 2 billion transistors. Intel and AMD barely have over 100 million in their newest CPUs, so the memory has 20 times the transistor count.

      A lot more engineering goes into a CPU, but the price of memory compared to a CPU isn't really that surprising.

      A lot of the microcontrollers I work with are basically a tiny sliver of processor on the edge of a large field of memory.

      Jason
      ProfQuotes

    2. Re:Sweet. by Kogase · · Score: 3, Interesting

      But aren't the transistors on a CPU considerably smaller? And don't CPU production facilities cost consiberably more than those for RAM chips? Notice the "don't" and the question marks.

    3. Re:Sweet. by ZorinLynx · · Score: 4, Interesting

      I've always wondered why they can't manufacture DRAM chips with spare memory cells, the same way that hard drives get spare sectors. Then rather than tossing out chips for as little as one bad bit, they can remap the bad bits to the spare cells and still use the chip.

      Yields would go up, prices would go down.

      I can't be the only person to have thought of this; why isn't it done?

      -Z

    4. Re:Sweet. by LionMage · · Score: 5, Interesting
      I recognize that the RAM is, if not the, then one of the most intricate and cost-intensive parts to produce and to purchase.

      Well, I can't speak to the cost-intensive part of your assertion, since I am not privy to some details about the economics of chip production. But intricate? Not hardly. DRAM and SRAM chips are laid out mostly in a grid, with very little real-estate set aside for control logic. The only complexity is the control logic; the rest of the chip is just a matrix of transistors (and, in the case of DRAM, one capacitor per transistor to actually store the bit).

      RAM chips are pretty easy to design and lay out because of the inherent regularity in their structure.
    5. Re:Sweet. by Euler · · Score: 2, Interesting

      exactly. There is a matrix of capacitors with only drive cicuits (transistors) at the end of the rows and columns. That is basically why computer designs always go with the relatively slow DRAM for mass memory due to its compact and economical nature. If you are designing a system that needs speed (like a cache or video device) you will always go with SRAM. But exect to pay _hundreds_ of times more per MB, and expect to have a way more physical address lines to contend with.

      Also, answering some of the other posts above, DRAM with bad cells will get downgraded by chopping off rows containing bad cells. So you might take a 32Mx32 chip and make it 32Mx16. Depending on the nature of the defects, the chip might be downgraded for non-critical use in things like digital answering machines which can tolerate a few bad bits in the data stream. I dont think downgrading the speed helps much though as far as bad individual bits.

    6. Re:Sweet. by corngrower · · Score: 2, Interesting

      While the digital logic is straightforward and easy, the actual design of a RAM chip is not. The engineers are effectively dealing with analog circuitry when designing these chips. The design of each memory cell is critical, as they need to be as small as possible. It takes a lot of experimentation and knowledge of semiconductor physics to design these things. These guys are definitely not slackers, they're the cream of the crop. The company's future depends critically on their knowledge and intelligence. If they can't devise ways of making the cells smaller, the chip becomes larger, the yields fall, forcing the company to charge higher prices for the memory. The company may quickly loose a competitive advantage and a downward spiral begins for the company. Engineers that design digital logic are much easier to find than those that understand the semiconductor physics and manufacturing processes well enough to design the circuit layouts of ram chip.

    7. Re:Sweet. by LionMage · · Score: 2, Interesting

      While everything you say may be true, my objection was to the use of the term "intricate" to describe RAM chip design. The layout isn't intricate at all. It is a highly regular structure. Not convoluted. Not intricate.

      To bolster my point, let's look at the definition of the word intricate: "1. Having many complexly arranged elements; elaborate. 2. Solvable or comprehensible only with painstaking effort. Complex."

      The physical structure does not satisfy the definition of "intricate." The complexity of RAM development stems from the inherent problems of solid-state physics that must be gotten around to pack the bits ever more densely. The economic drive to be competitive forces innovations in increasing bit density, but once the design work is done and the production process has been tweaked... that's it. The end result might be a marvel of engineering, but it's not intricate as the word is defined, sorry. Maybe the engineering process could be described as intricate (though I would consider this a stretch), but not the end result.

  2. And just how do I benefit? by Nom+du+Keyboard · · Score: 2, Interesting
    And just how do I benefit?

    It's not like I expect them to send me a check in the mail. And if they did, it would cost me more in time and effort to collect it than it's value.

    The lawyers should have to be paid just like everyone else that sees any part of this settlement.

    --
    "It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
  3. Re:Does this mean memory prices will fall? by The+Clockwork+Troll · · Score: 2, Interesting

    No, in fact now the high prices are legitimized because they all need to pay restitution and legal bills.

    --

    There are no karma whores, only moderation johns
  4. And who benefits from this? by what_the_frell · · Score: 4, Interesting

    You can bet your cash-starved wallet it'll be the corporations DELL that will receive the compensation/benefit, and keep the RAM pricing the same for the consumers so they can continue to recoup their losses .

  5. Re:The $160 million dollar tax question... by Nos. · · Score: 3, Interesting

    Hopefully not, even though another company was allowed to do something similar
    Since sending out a cheque to every buyer affected would be next to impossible, they should have to sell their chips below (or at) cost until the fine is made up. That way, those who were harmed would have a chance to recoup some loss.

  6. It really shocks other libertarians when.... by ShatteredDream · · Score: 5, Interesting

    People like myself, who are more classical liberals than libertarians, apply Lord Acton's famous expression "power corrupts and absolute power corrupts absolutely" to economics. The more wealth that is centralized in faceless organizations, the more power they have. Yet, the wealth is not to be measured in just how much cash they have, but by the position they enjoy which can be worth more than their bank accounts.

    Anti-trust laws are nothing more than a way to provide a check on corporate power. They exist to keep companies, especially big corporations, from becoming in Locke's words "a law unto themselves."

    Anyone who calls themself a libertarian, opposes antitrust laws and has a sympathetic view of the south in the civil war would do well to read some of the founders of the CSA's opinions on monied corporations. The short summary is that they considered them to be a plague on basic liberties and the free market and were fighting more against the corporations who saught the tariff which taxed the southern economy terribly and used the money to line the pockets of corporations, than it was for "states' rights." The major state's right was to "be free from being sucked dry by monied corporations."

    I will say this about monopolies. The government creates many of these headaches that it has to later solve by having expansive IP laws which allow patent holders to rape and pillage innovators. Would someone please tell me why we can patent online shopping carts and file formats? How about business processes in general? What about things we have never even fully or at all implemented ourselves?

    If the government were to be reconstituted on classical liberal values, most of these monopolies would die like vampires in the morning sunlight.

    --
    Click here or a puppy gets stomped!
  7. Conflict of Interest by jmulvey · · Score: 4, Interesting

    "Infineon has agreed to pay a $160m fine to the US government"

    Once again, the companies profit and the US government gets cash... and joe six-pack gets screwed. I mean, with the government receiving all these settlements from Microsoft and the tobacco companies... why aren't our taxes going down?

    The US government has more than a bit of conflict of interest in its role as protector of the public from price-fixing and monopolies, yet recipient of huge settlements when they are allowed to grow and blossom.

    I'm sure Infineon, a company that has annual GROSS PROFITS of over $2 BILLION USD a year made a hell of a lot more that $160m. So Infineon makes out, and the government makes out.

    But where's my money? You remember me, the guy that got ripped off?

  8. Re:Odd Concept by Anonymous Coward · · Score: 1, Interesting

    Well, if they hadn't have been price fixing, the ram prices would have gone down 99.9% instead of just 99.7%.

  9. Re:Now thats fair. by lothar97 · · Score: 5, Interesting
    What's even more aggrevating is that these companies, once they pay for the mistakes in some manner (such as a fine), they are free to function as if nothing went wrong.

    A perfect example is MCI/Worldcom. After imploding under massive amounts of fraud, screwing tons of people out of investments, employment, 401ks, etc, the company gets to "re-organize," pay a fine, then get government contracts. I bet if I'm punished for fraud, I would be shunned for life in any type of business setting.

    This corporate crime problem will continue as long as it can be solved by fines, admitting no wrongdoing, and the limited minor punishments for those involved. I imagine if we held these people personally liable for all damage, put the company under 5-10 years probation, and made sure large jail sentances were required, we'd see a lot less of this trickery.

    Then again, we don't want to hurt the innocent employess, and we don't want excessive government regulation.

    --

  10. Big cartel, this one? Pffft. by SenorCitizen · · Score: 5, Interesting

    If you want a *big* international anti-trust case, just try sueing OPEC.

    How are they any different?

    1. Re:Big cartel, this one? Pffft. by drinkypoo · · Score: 2, Interesting

      I realize that globalization is busy blurring the line between the two sets of entities, but at the moment businesses don't have militaries.

      It's a good thing, too. However, that day is probably coming. I believe this much of the "dark future" scenarios that we find in the much-maligned (usually deservingly so) "cyberpunk" genre: Some governments are going to collapse. Some corporations are going to become sovereign powers. And it's going to go very, very badly. Hopefully it will only be a fad...

      --
      "You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
    2. Re:Big cartel, this one? Pffft. by Cecil · · Score: 2, Interesting

      Well, being "out" of oil never really happens since current recovery technology only allows us to get about 20% (on average) of the existing oil out of the ground, but as far as oil production, yes, most of the domestic U.S. oil fields are either unviable fields (there's a break even point where it costs more to produce a barrel of oil than you get for selling it) or very mature (fields that have produced most of their recoverable oil, have therefore lost most of their pressure, and are only pumping a tiny fraction of what they were at their peak)

      A lot of this is because the first oil well was drilled in the U.S. and the U.S. quickly became a leader in the process. It took about 40 years after that before oil was discovered in most of the middle east.

      But yeah. I work in the oil and gas industry (aka Pure Evil Incorporated), and I don't have much sympathy for the anti-OPEC crowd either, because I think they're actually surprisingly reasonable. Sure, they're artificially keeping the price high (albeit still reasonable enough for people to buy it, apparently), but like you said, the alternative is much worse for them and for everyone. s/oil/(some endangered but useful-to-hunt animal)/ and the reason they act the way they do becomes more clear.

      Besides, I know that if I was in their position, I'd be much less reasonable than they are about pricing and market demands, heh. ;)

      --
      Random and weird software I've written.
  11. Antitrust! by Exmet+Paff+Daxx · · Score: 4, Interesting
    Now let me state the present rules,"
    The lawyer then went on,
    "These very simple guidelines,
    You can rely upon:
    Your gouging on your prices if
    You charge more than the rest.
    But it's unfair competition if
    You think you can charge less!
    "A second point that we would make
    To help avoid confusion...
    Don't try to charge the same amount,
    That would be Collusion!
    You must compete. But not too much,
    For if you do you see,
    Then the market would be yours -
    And that's Monopoly!

    - The Incredible Bread Machine

    There are no rules, save "Don't Succeed". Gotta love America - they love capitalism, and someday they intend to give it a go.
    --
    If guns kill people, then CmdrTaco's keyboard misspells words.
  12. Re:Free market isn't perfect by doc+modulo · · Score: 4, Interesting

    In the age of the industrial revolution, it was free market all the way. It turned out to be a reall hell for the employees. Near-slavery situations.

    In the end, the manufacturers failed as well, because they gave so little money to their employees and other population groups, that no one could affort their products anymore.

    People have to abide by rules, and so do companies/corporations. corporations try to be an "individual" anyway, so they should accept the responsibilities that come with it.

    Limitations on what powerful entities can do to the rest of the population is good for the population. In the end it's also good for the powerful because rules make sure that no one can leech the population dry with cartels and monopolies and people will be able to afford the products and services.

    --
    - -- Truth addict for life.
  13. Re:No, That's Impossible by HarveyBirdman · · Score: 2, Interesting
    I know you are kidding, but it's a view held seriously by many over-politicized geeks. I had one at work last month whine about how all the "Enron guys got off scot-free". I pointed him to a web page detailing the indictments and convictions already handed down, along with exactly how complex the case was (hence the delay as cases were prepared), and a little mention of "innocent until proven guilty".

    You should have seen the retarded idiot go through multiple waves of ideological panic in trying to fit the facts into his monochromatic world view. Truly a scary sight. He kept trying to filter and twist the information. A world where Bush was President and Enron executives got punished simply could not exist in his tiny, broken mind.

    I used to think ideology was a mental illness, but these days I think it's just the may most people's brains are wired. It's going to take another 9 million years to evolve away. So, 9 million more years of total and complete fuckheadedness from the bulk of humanity, day in and day out.

    C'moooon asteroid!

    --
    --- Ban humanity.
  14. Re:Free market isn't perfect by Anonymous Coward · · Score: 1, Interesting

    Well, as one who studies (but does not practice) libertarianism I would say this is a situation that would not be sustainable or the situation would not even arise if we were in a complete libertarian (e.g. laissez-faire or the like) environment.

    Things like tariffs, government subsidies, government nepotism, meddling, etc. have made these kinds of situations possible in the first place.

    Antitrust laws are a necessary by-product of the problem, not a solution.

  15. Re:Now thats fair. by raygundan · · Score: 2, Interesting

    I agree with you. If they managed to find enough evidence to prove there was collusion, then surely they have enough information to point out the names of at least some of the people involved in the price fixing. These people should all be punished under normal theft laws for taking the money.

    Your pick:

    1. One huge count of stealing millions as if it were from a federal bank.

    2. Hundreds of thousands of smaller counts of stealing from the individuals and companies who paid higher prices for their RAM.

    The punishment should include immediate repayment of the amount they gained through price-fixing, and whatever additional jailtime and fines are associated with theft of that magnitude (or quantity). Only when the *people* who run corporations are subject to the penalties for their illegal actions will this crap stop.

    It strikes me as an odd side effect of "corporate personhood" that the crime belongs to the company, and the individuals are not punished-- yet we have no comparable punishments for a company. We can't put a corp in jail for 20 years, and we can't give it the death penalty for awful crimes. So everything is just a fine... and companies treat it as "cost of doing business," just like you and I paying speeding tickets.

  16. Re:Odd Concept by HBI · · Score: 2, Interesting

    I remember paying $450 for an entire XT compatible with 640mb of RAM. The price without RAM was $200.

    It was well over $1000 a meg at one point. The price of RAM has been dropping over the years though. In the early days (70's) you could spend that much on 64k of Static RAM.

    --
    HBI's Law: Frequency of calling others Nazis is directly correlated with the likelihood of the accuser being Communist.
  17. The reason for this by IGnatius+T+Foobar · · Score: 3, Interesting

    The real reason for this: Windows Longhorn is going to require an obscene amount of memory, so Microsoft's new bought-and-paid-for friends in the DOJ are making sure RAM chips are inexpensive.

    --
    Tired of FB/Google censorship? Visit UNCENSORED!
  18. Re:Now thats fair. by Marxist+Hacker+42 · · Score: 4, Interesting

    We can't put a corp in jail for 20 years, and we can't give it the death penalty for awful crimes.

    Actually we could- we just don't because we don't have any politicians left to write the laws to do so, just corporate puppets.

    How to put a corporation in jail for 20 years: take away it's bank accounts for 20 years and give the interest to the victims.

    How to give a corporation the death penalty: Let the government confiscate it and start competing with other businesses in that industry.

    Bet if you had those two punishments instead of the fines, the corporations would shape right up.

    --
    SJW: a person who perceives an injustice, and while correcting it, commits a greater injustice.
  19. Re:Now thats fair. by chancycat · · Score: 4, Interesting

    Or for that matter, execute convicted perpetrators of fraud, as China does and did recently for four cases of bank faud. Note I do not support capital punishment, and China's examples put the topic into a perspective I've never encountered before: "a 'kill fewer, kill carefully' policy for nonviolent crimes."

    --
    Evan - needs to hit preview before submitting
  20. Definitions by Anonymous Coward · · Score: 1, Interesting

    Collusion: Your price is the same as the market price.

    Dumping: Lowering your price.

    Price fixing: Raising your price.

    (At this point it should obvious that anything a business does is subject to "antitrust" laws. And somehow people are shocked that corporations would rather headquarter themselves not in America.)

  21. Re:China executes its white collar criminals... by orim · · Score: 2, Interesting

    I fully support this. All these execs/bankers/etc who are stealing money...

    1) they are stealing from somebody, everybody

    2) people usually work for their money. while some of us are lucky to to enjoy our jobs, we still *have to* work to be able to eat. we spend a good portion of our life working.

    3) somebody steals our money, they've just stolen our time, which in sufficient quantities could equal working our entire lifetime.

    4) when they've just stolen enough money to equal the national average salary * national average working lifespan, they've stolen a life. That's when we execute the bastards.
    (in 2002, that was $33,252.09 * 40years = works out to about $1.3 million)
    I'd propose making them work it off, but keeping people in prison costs us money vs. making us money.

    I think we should have more than a few executions for this shit in the US. It's about time.

    --
    "If you could only see what I've seen with your eyes..." - Roy Batty
  22. Re:Now thats fair. by killjoe · · Score: 5, Interesting

    "Then again, we don't want to hurt the innocent employess, and we don't want excessive government regulation."

    Punishing the guilty should not be seen as excessive govt regulation. The solution is simple. Dissolve the corporation and confiscate all the assets.

    It's imperitive that the shareholders get screwed in the worse possible way possible. It was their job to make sure their company was run responsibly and it's their fault that the company committed crimes.

    Once the assets get liquidated the money should be given as severence pay to all the employees starting at the bottom and working your way to the top until the money runs out.

    --
    evil is as evil does
  23. The old sinclair spectrum by blackest_k · · Score: 3, Interesting

    just for historys sake the spectrum was designed with 32 k ram chips which were actually failed 64k ram chips I think a jumper decided if the top half was good or the lower. in later times the spectrum got working 64k ram chips still for use as 32k.

    --
    Blarney Quality Restaurant, Plants
  24. RAM prices are fluctuating wildly by Cryogenes · · Score: 2, Interesting

    and there are at least a dozen competing vendors. When they charge low, they get hit for dumping, when they charge high they get hit for fixing.

    Or is it the US extorting money from foreign companies because they can? Does it also happen the other way round? (And don't give MS vs. EU as an example, MS hasn't paid a penny yet and probably never will).

  25. Re:Free market isn't perfect by lightknight · · Score: 2, Interesting

    It cares ONLY about liberty, but cares squat for justice or democracy.

    Justice? I do not believe there is any law or right whereby a supplier is required to sell something to you, at any price.

    And if prices were raised via collusion after I got into that market? What then? Screw it, change businesses?

    Yeah, it happens. Even in our society. Deal. Alternatively, you could expand your business so that it encompasses RAM production. Or you could wait for someone else, not affiliated with the cartel, to jump in (high profit margins/limited demand tend to have that effect).

    Should I suffer financial pains because of the collusion of suppliers?

    No, you should suffer financial pains if you are unable to overcome challenges that are thrown at you, like any business owner. If you fail, you fail. Deal, like everyone else.

    Now, someone will eventually cite IP as a problem. Whine, whine, bluster, but they have IP and I can't make those chips. Well, if they are unwilling to license their IP, fight back. File for some offensive patents: pidgeon hole them. Make it so that they cannot advance their tech, or even sell it, without working out a deal with you.

    You sound like a union worker: you've blocked yourself inside a box, and are unwilling to consider the alternatives. "I make computers, that's all I want to do, and if someone won't sell me their components, I can't do anything to help my poor self, but whine about social justice and ?democracy?".

    The marketplace is about transactions, and capitalism is built on the principles of dystopia, yet it can create a veritable utopia, by having everyone appeal to their own self-interest (short of theft (of property) or physical harm (of your body)). Greed ensures that people like money, much more than they care for racism, sexism, or personal vendettas. If they can ship a couple more units, making more money in the process, they quickly set aside whatever personal problems they have with you.

    --
    I am John Hurt.
  26. I only have one question... by ZeroOne42 · · Score: 2, Interesting

    Where does the US$160 million go? Who gets it? Do the people around the world who bought overpriced RAM get a cut out of it?

  27. Re:Problem is production methods... by grainofsand · · Score: 2, Interesting

    But why hasn't the futures market been able to smooth these fluctuations as it has for almost every other conceivable product on earth?

    --
    A dream is good. A plan is better.
  28. Who gets the 160 Million? by rspress · · Score: 2, Interesting

    How about the people who ponied up the dollars to buy it! I bought RAM from crucial.com a division of Micron. Shouldn't I get some dollars back?