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Infineon To Pay $160 Million For Fixing RAM Prices
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.
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.
The real question is do they get to give away a bunch of 256k chips to schools as a tax credit?
I recall that things got pretty bad for awhile, but I still have a hard time with the concept of price fixing, when I clearly remember paying $150 for 8MB of ram, and how good of a deal that was.
A local family man is facing 20+ years in prision for walking into the vault at the back where he worked and taking 100,000 USD.
Why do large corps get away with crap like this, hell the goverment doesn't even go after those whitecollar criminals that skip bail...
But, normal crimes they come down hard on.
Guess we won't be getting our $13.50 checks. :-p
-jls
Techno-pagan
Cases like this remind me why I don't think the libertarian philosophy towards free markets is all that realistic. Many libertarians believe that things such as this should be left to the marketplace to settle, and that government "interference" like this ultimately harms the market. I emphatically disagree. There are inherent flaws with the free market that the justice system can and should remedy so that the overall market is healthier thereby. Collusion does no one -- consumers, industries, or the economy as a whole -- any favors, and I fail to see how letting the market handle it would do anything but unfairly fatten the pockets of those who benefit.
Maybe it's like the RIAA settlement.
Each lawyer gets a new yacht, and we get a check for $4 in the mail.
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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 .
From the article (condensed for brevity):
Infineon Technologies announced today that it has plead guilty to a single and limited charge related to the violation of US antitrust laws in connection with the pricing in its Dynamic Random Access Memory.
Infineon strongly condemns any attempt to fix or stabilize prices. Infineon is committed to vigorous and fair competition based solely on superior products and services.
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.
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For the past 2-3 years, RAM prices haven't dropped--they've gone up. The RAM that I bought with my current computer costs MORE now than it did when I bought it a year ago, and not only that--its crap quality too! Its supposedly PC3700, but won't hit PC3700 speeds on stock timings even with extra voltage!
;)
This is one of the few great examples where we get to love the American legal system
"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?
Sure. Just like CD prices fell after the CD price fixing settlemet... oh, wait...
Then I guess this will be like my rates with progressive going lower after they had the class action law suit over adjusting rates based on credit... oh, wait... that didn't happen either.
The only peopel to benefit from this will be the lawyers and the major companies - the rest of us will be lucky to get a coupon for a dollar off.
Every good slashdotter should realize that this is impossible. Theregister must just be trying to pull one over on us. I mean, clearly the Bush Administration is in the pocket of Corporations, and would never allow this to happen to big business. Obviously, the story is a farce.
Freedom is the freedom to say that 2 + 2 = 4
Interestingly, there is a press release on this topic on the Infineon web site. Please note a discrepancy between what the Register says and what their press release says...
Register: "Infineon has agreed to pay a $160m fine to the US government for fixing the price of computer memory from 1999 to 2002, one of the biggest ever penalties imposed by the DoJ's Antitrust division."
Infineon: "The wrongdoing charged by the DoJ was limited to certain OEM customers. Infineon is already been in contact with these customers and has achieved or is in the process of achieving settlements with all of these OEM customers."
So, is the government getting the money or the OEMs. Note that either way, the trickle down to regular folks (i.e., you!) will take a long time.
p.s. I love this quote from the Infineon press release: "Infineon strongly condemns any attempt to fix or stabilize prices. Infineon is committed to vigorous and fair competition based solely on superior products and services."
Infineon 0, U.S. Department of Justice 1.
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If you were to actually pay closer attention to TFA, You'd have noticed the related articles linked at the bottom. More specifically this
"The case centres on allegations that between the end of 2001 and mid-2002, Samsung, Hynix, Micron, Infineon and others covertly agreed to up prices. The alleged jump in prices followed a two-year slump in demand that drove most memory production lines into operating at a loss."
They may not have been named in the settlement, but they certainly have been named at one point or another.
The latest info I can find dates from around May, but Infineon is one of the DRAM makers facing a patent-infringement lawsuit from Rambus, and if that doesn't go well for them (Rambus had an initial setback but has been getting favourable rulings since; anyone who wants to cry "submarine patent!" better read up on the history, it's nowhere near that cut-and-dry) they could very well go under. I think they will lose it, and get hit with willful infringment for triple damages, which will easily run the damages into the billions. I doubt Infineon could absorb that.
there's added incintive for the companies to NOT DO THIS SORT OF THING now, the society as a whole benefits and that is how you get the benefit.
that's the whole point of those fines, you make the RISK of running such price fixing schemes too high that they don't want to take it.
like the fairly recent cartel busts in metal and paper industries(northern+mid europe)... you don't directly get anything but by punishing with hefty fines (also in the 100m+ range)they send a message that "don't fucking do this".
world was created 5 seconds before this post as it is.
If you want a *big* international anti-trust case, just try sueing OPEC.
How are they any different?
- 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.
Um, not only did you not RTFA, but you don't seem to realize what the term, "price fixing" means. In a non-monopoly environment(like memory), if one company raises it's prices, it's not price fixing, it's capatilism. If the market doesn't like the higher memory prices, then nobody buys their stuff and either the prices drop or they do.
In this case though, it was a bunch of memory manufacturers who make up a very large chunk of the market colluding to keep prices high. This is kind of like a "Monopoly Voltron"->together they combine forces to become a virtual monopoly, even though they are seperate parts.
Monstar L
there's added incintive for the companies to NOT DO THIS SORT OF THING now, the society as a whole benefits and that is how you get the benefit.
Yes, these wonderful lawyers who are doing this for the little people like you and me. The fact that they're making millions of dollars is inconsequential to them.
I mean, look at the music industry! They've definitely changed their ways now that 20 different lawyer firms have made millions off of them and we've all gotten $2.85 checks in the mail.
I've just signed legislation that'll outlaw Russia forever. We'll begin bombing in five minutes.
I must be missing the joke. Why is it bad I get a yacht?
-he who laughs last, is a bit slow.
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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.
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If I personally break the law I will probably be incarcerated for my crimes. Yet a corporation who's only job is to make more money then it spends simply pays a fine. If I am in jail I can't earn any money or perform any deeds outside of a very limited set of rules. Corporations shouldn't be fined. They should be forced to shutdown or even be disbanded.
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The difference, my child, is that OPEC is an international entity with no "place of business" in the United States. As such, they have no need to obey U.S. Anti-trust laws in exactly the way the average U.S. citizen has no need of obeying the laws of the United Arab Emirates.
--AC
If you sell at too low a prices then you're "dumping" and that's illegal too.
One law is there to protect the consumer and the other is there to protect other suppliers.
Unless companies can sustainably make profit from their silicon sales we're doomed to boom and bust cycles where we oscillate between RAM surpluses and RAM shortages. In the long run, we all lose if these companies cant stabilise and make reasonable profits.
Engineering is the art of compromise.
It's not so much the die size, but the circuit complexity. A memory chip is basically the same circuit duplicated several million times. A CPU has registers, ALUs, pipelines, control circuitry, and who knows what else. Memory chips are cheaper to design, and sell in greater quantities.
"I'm not impatient. I just hate waiting." - My Dad
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.
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