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RAM Manufacturers Fined for Price Fixing
TufelKinder writes "From Law.com: 'In the largest fine ever obtained by San Francisco antitrust prosecutors, a Korean company has agreed to plead guilty and pay $185 million for its role in a conspiracy to drive up the price of computer chips.' Micron and Infineon have also been fined for their role in the scheme." From the article: "It's the third-largest fine of its kind in the United States, and it could be just a preview of even bigger penalties. The far-reaching computer chip investigation, which alleges wrongdoing from 1999 through 2002, affects thousands of consumers."
Honest
So the money goes to who, instead of the customers?
Ram is pretty cheap as it is, it's gonna be awesome if somehow prices drop even more because of this.
Le français vous intéresse?
Will they pass the cost onto the consumer?
This has got to be a wake-up call to major corporations. This goes to show that price-fixing will not be tolerated in the tech industry. Now perhaps we could get this to extend to other industries such as DVD's/CD's, and maybe even OIL!
Okay, okay, I admit it, I'm drunk.
What does this mean for RAM prices in the near and far future?
Will OEMs keep prices where they are now and pocket the difference? Or will they lower prices?
Yay so I can use the money I will save on RAM and put it towards high gas prices.
crap
*looks at $2.00 per meg PC-133 chips* ... ... ...
*waits for class action lawsuit notification*
How much did they make during that time?
I'm often dissappointed in fines like this when I find out that the execs did a little jail time, paid a fine, but still have 6 Lamborghinis in the garage. It's important to implement fines that are severely punishing...like the people involved would have been WAY better off not pulling this kind of crap. The should be destitute. I can't stomach the wealth accumulated on the backs of the bruised.
I'm not saying that's what is going on here, I don't know. It just makes me sick when most people involved still come out ahead, and there is maybe one or two sacrificial lambs.
I'm sorry, but your opinion seems to be wrong.
The cost of gas is shooting up to sky-high levels for many reasons:
a) OPEC has too much pricing power over crude oil
b) available supply is falling (it's finite)
c) demand is climbing (China, anyone?)
d) it's REALLY hard to get permission to build refineries in the U.S.
If seems to me that claiming "price fixing!" in this case is perfect example of the H.L. Mencken quote:
For every complex problem, there is a solution that is simple, neat, and wrong.
Life is short: void the warranty.
After joining/initiating price fixing with its competitors and making good profits, you rat out on your competitors without paying the fines.
Actually, the price of RAM will probably go up after this so said companies can afford to pay off their fines without reaching into their own pockets.
When a telephone company gets fined, where does the money come from? Increased prices/fees.
When an energy company gets fined, where does the money come from? Increased prices/fees.
When a car maker gets fined, where does the money come from? Increased prices/fees.
Why do you think this will be any different? They're just going to do it again, and not get caught.
Job? I don't have time to get a job! Who will sit around and bitch about being broke and unemployed then?
The problem with such a plan is nations that are part of OPEC are full members, not some company mind you, but the government itself. Regulation of the oil industry would be far harder as it would directly involve the host nations who tend to like to do what they want on their own soil where they directly make the laws.
Help Brendan pay off his student loans
Allow me to add another Mencken quote:
The American public knows what it wants, and deserves to get it. Good and hard.
"Sometimes a woman is a kind of religion, she can save your soul & set you free from all your sins" - Bad Examples
This was the government. It's a fine. Fines go to the government.
There have been additional claass action suits filed, which will make the ambulance chasers, err, plaintiff's lawyers, wealthy while producing almost nothing for the customers.
hawk
It absolutely does, minus the 184 million dollar legal fee the lawyers get for enabling justice on your behalf, of course.
~Someday, I hope to be an aspiring author.
this stuff happens all the time. its just usually there isnt enough hard evidence to do anything about it. as scary as it sounds, though, in big business nothing is a mistake. i bet you 186 million that that money is going to end up back in the hands of the people that started this price fix to begin with. anyway, maybe im over paranoid when it comes to money. perhaps it has something to do with the fact that the federal reserve isnt owned by the usa, and every president that attempted to change that died under odd circumstances or was assassinated. anyway, nothing to see here, go back to earning your ink'd papers. god help us all.
...will receive a 32MB stick of PC 66 memory.
I wonder how much they profited. The fine for the top music industry companies was about $143 million but due to price fixing consumers were overcharged $480 million. That's a profit of about $337 million.
RAM is a commodity, much like LCD displays, CPU's, and GPU's.
By itself, it isn't very useful, but when combined with other systems (desktops, laptops, PDA's, mobile phones, handheld consoles), it becomes a very useful item.
As with all commodities, the price will always go up whenever demand exceeds supply. And the suppliers will always try to achieve this; either by sophisticated marketing to boost demand (eg. the diamond market, the power generators warning of a shortage of electricity) or by matching reducing supply to match demand (OPEC, the RAM market).
Vintage computer adverts: http://www.vintageadbrowser.com/computers-and-software-ads
"This case shows that high-tech price-fixing cartels will not be tolerated" But oil cartels? Bring it on...I'm paying $2.30/gallon out here in the midwest...
Something Witty Goes Here
The cost of gas is shooting up to sky-high levels for many reasons:
Don't forget - the devaluation of the American dollar.
Even though oil is officially priced in US dollars, that does not make its pricing tied to the value of the dollar. Since oil has intrinsic value, if the value of the US dollar goes down, the price of oil must go up so as to roughly maintain value parity.
First, a lot of oil comes from OPEC, which is (openly) a cartel. They have well-publicized meetings every few months to fix oil prices.
Then there are the brokers and refiners. We have audio tapes of Enron execs laughing as they caused California's energy crisis of a few years ago by needlessly shutting down suppliers, in order to drive prices through the roof.
Then there's geopolitics. i.e. invading Iraq and then declaring Frace won't be getting any of the oil because they're uncooperative, then getting mad when we discover they weren't obeying our Oil For Food program.
I'm not saying basic economics is irrelevant, but let's not pretend Econ 101 is the real world either.
de Beers has been doing that for years without getting sued.
So now they have a REAL reason to charge more for the memory. Sounds like a solution to benifit the consumers for sure! How much of the $185 million went to lawyers and lawfirms and how much of that is going back to the consumers? $0.18 checks aren't worth crap to the consumer that bought the memory at the 'fixed rate'. Cause in the end, the consumers get nothing back from a suit like this except paying more for the memory in the future because of the impact of the lawsuit. The lawyers make out like a bandit! Why else do imagine these lawsuits exist?
The things I can think of that are going up in price these days are:
- Food
- Petrol
- Automobiles
- Housing
- Other luxury items
With the exception of the first two (food and fuel), everything else is an extremely high-ticket item that you buy very rarely. The day-to-day cost of living expenses like cheap manufactured goods, clothing, etc. have been tending to decrease in price as we find more third-world countries to exploit^w^w^w^w^w^wcome up with newer, more automated means of production to reduce the cost.The cost of electronics is the most extreme example, showing a very severe downward trend, but this deflation applies to other things as well. All that sweat-shop clothing has driven textiles way down. Chinese knock-offs are starting to really cut the prices on random non-electronic equipment---I bought a precision torque wrench for $12 that would have cost $60 ten or fifteen years ago, and a Chinese-made ribbon mic for less than the cost of a replacement ribbon for a vintage ribbon mic....
I'm not saying everything is going down, but I would say the majority of things are, from what I've seen. The ones that aren't are either things that can't be reasonably manufactured overseas and imported (food, beverages, fuel) or are situations where the supply is being artificially stifled to drive up prices (fuel again, automobiles, housing).....
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According to Hoovers, Hynix's NET income for 2000-2002 was $7.5 Billion with a "B".
Better look at those numbers again. Hynix's net LOSS was $7.5 billion over that time period.
I do work with music synthesis and man, can that shit eat RAM. I have a sample DVD of a drumkit, just a normal trap set with 5 toms, a selection of cymbals and so on. It's 2.4GB, oh and it's the small one. Their full one, with all different styles of kits (like using brushes instead of sticks) is 35GB (comes on 4 DVDs). The same company makes an orchestral sample set with basically all instruments from an orchestra in 3 different mic positons. 68GB.
Now the sampler technology is advanced enough that it can load just the start of the samples in RAM and then stream off the disk as needed, but there's limits to that (only so fast the disk can go) and you still need part in RAM. Eating up the 2GB I have is cake, and I don't even have the really big sample sets.
Now pro apps like those aside, normal apps will grow to use the memory, if it's available. Games can almost always use more memory, if for no other reason than to eliminate any kind of load times (by loading more data further ahead). I'm sure most game makers would like to use more RAM than they do. However, you won't sell many games if you require something most people don't have. If RAM prices go down and amounts go up, they'll start using more.
Some games already do. World of Warcraft just isn't happy unless you have a GB of RAM. It'll run on less, but you'll find it lagging and stuttering as it scrambles to get the graphics off the disk. You give it a GB, it gets pretty happy and smooth.
Something tells me these folks didn't buy the right judges...
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If we begin drilling in ANWR and restart the pumps throughout Texas, California, and other states, we can do a lot to lower the price of crude.
And if we don't, as the price of crude continues to rise alternative energy sources will become more economically feasible and attract greater investment.
You'll notice a common thread: It is environmental activism that is really causing the most significant increase in your gas prices. Get rid of that and you can enjoy your sweet nectar for a more reasonable price. And remember: The purpose of the environmentalists wackos is not to fix the environment, but to shut down our economy and destroy our capitalism.
Wow - way to go FUD-Master! You should see if Microsoft or the RIAA is hiring....
No, environmentalists are not out to "destroy our capitalism." At its economic heart, environmental regulations seek to minimize externalities You can build a refinery, but that refinery is going to cause air pollution, water/ground-water contamination, and environmental degradation. It's going to affect the plants and the animals in the immediate area as well as downwind or downstream. It's going to cause health problems for people.
TANSTAAFL - if you're going to build a refinery, you've got to pay for all of these damages you are going to cause, or pay to prevent them. Gov't regulations are one mechanism to force you to do that, because you're not going to do it out of the "goodness" of your profit-seeking capitalistic heart.
I hope gas prices keep going up, and that creative entrepreneurs in this country find new ways to generate and conserve energy in a profitable way. These are your true capitalists - not Exxon Mobil, Shell, and BP.
We need to lighten the regulation and we need to allow more and bigger refineries to be built.
I've ggt a good idea!
Let's install the refinery in YOUR backyard, with no environmental regulations. 'k?
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