You cant just “fund a startup trying to make ram”. Chip fabrication is probably the most difficult and capital intensive production process there is. What manufacturing more ram looks like is investing tens of billions of real money (not the you give us stock we let you use our GPU deals the AI companies have been doing) and then waiting 5-10 years before the fab you funded starts to make chips, and hope prices are still high by then.
That’s why the existing manufactures are slow to scale up, they arent sure that the current spike in demand will still be there by the time their scaling up increases production.
Yes, but also cartel behavior.
Those same 3 manufacturers have been found guilty of it in the past, and it wouldn’t surprise me one bit if they were fixing prices again now.
See this video by Gamers Nexus.
Its both things to be perfectly honest. Last Time there was a ram bubble. A bunch of companies all went belly up because they ramped up production too high to meet demand. Got caught left hold in the bag. It’s why this so few companies now and why they can do the cartel nonsense.
And well, yes, they’re very clearly doing cartel nonsense yet again. They also aren’t entirely wrong in their reasoning. They’re just going about it in a really s***** manner.
Cuz if they did ramp up production and then the bubble pops and the left holding the bag and one of them goes belly up then we’re all f***** even more. Prices will then actually legitimately just go up even more. Which would just f*** everyone even more.
History has proven that ramping up production to meet a bubble is a stupid business decision. It also hurts your customer and hurts your profits in the short to medium term.
So you have a logical historical reason. A logical current business reason and illegal cartel nonsense.
There’s just no reason to ramp up production. It just doesn’t make sense on any front. It’s basically purely knee-jerk reaction.
Of all companies, though, Microsoft is one of the few who could easily afford to sink a few billion into starting in-house chip production.
And even if they only ever produce chips for their own products, they’ll still probably come out ahead in the long run, because of all the money they’ll save on not paying inflated prices for others’ chips to use in Microsoft hardware.
That ‘in the long run’ part is the problem, though. Corps can never see beyond the next quarterly earnings report. An investment that will take years to pay off … that’s just out of the question.
Try decades… Chip fabs take like 5-7 years just to get running and then double that to recoup. No company is going to gamble on a possibility 15 year investment for a very obvious bubble.
You cant just “fund a startup trying to make ram”. Chip fabrication is probably the most difficult and capital intensive production process there is. What manufacturing more ram looks like is investing tens of billions of real money (not the you give us stock we let you use our GPU deals the AI companies have been doing) and then waiting 5-10 years before the fab you funded starts to make chips, and hope prices are still high by then.
That’s why the existing manufactures are slow to scale up, they arent sure that the current spike in demand will still be there by the time their scaling up increases production.
Yes, but also cartel behavior. Those same 3 manufacturers have been found guilty of it in the past, and it wouldn’t surprise me one bit if they were fixing prices again now. See this video by Gamers Nexus.
Its both things to be perfectly honest. Last Time there was a ram bubble. A bunch of companies all went belly up because they ramped up production too high to meet demand. Got caught left hold in the bag. It’s why this so few companies now and why they can do the cartel nonsense.
And well, yes, they’re very clearly doing cartel nonsense yet again. They also aren’t entirely wrong in their reasoning. They’re just going about it in a really s***** manner.
Cuz if they did ramp up production and then the bubble pops and the left holding the bag and one of them goes belly up then we’re all f***** even more. Prices will then actually legitimately just go up even more. Which would just f*** everyone even more.
History has proven that ramping up production to meet a bubble is a stupid business decision. It also hurts your customer and hurts your profits in the short to medium term.
So you have a logical historical reason. A logical current business reason and illegal cartel nonsense.
There’s just no reason to ramp up production. It just doesn’t make sense on any front. It’s basically purely knee-jerk reaction.
If only there was something like a chip act that the government could have provided that capital….
Of all companies, though, Microsoft is one of the few who could easily afford to sink a few billion into starting in-house chip production.
And even if they only ever produce chips for their own products, they’ll still probably come out ahead in the long run, because of all the money they’ll save on not paying inflated prices for others’ chips to use in Microsoft hardware.
That ‘in the long run’ part is the problem, though. Corps can never see beyond the next quarterly earnings report. An investment that will take years to pay off … that’s just out of the question.
Try decades… Chip fabs take like 5-7 years just to get running and then double that to recoup. No company is going to gamble on a possibility 15 year investment for a very obvious bubble.