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For months, rising electronics prices have been blamed on increasingly expensive RAM and flash memory used in SSDs. Now the matter has taken on a whole new dimension. The world's three largest memory manufacturers have been sued in the United States on charges of illegally fixing prices and restricting production. If the allegations are confirmed, this could be one of the biggest antitrust cases in the tech industry in recent years. For now, the companies strongly deny all the allegations.
Samsung, SK Hynix and Micron accused of price-fixing
A class-action lawsuit filed in California targets Samsung, SK Hynix and Micron, which account for the vast majority of global DRAM production and a significant share of the NAND Flash market. According to the plaintiffs, the manufacturers allegedly coordinated to cut production of DDR3 and DDR4 memory while redirecting production capacity to the more profitable HBM chips used in data centers powering artificial intelligence. The plaintiffs say this led to a sharp rise in prices of memory used in computers, consoles and many other electronic devices. The suit even cites price increases of up to 700 percent over the past four years. The plaintiffs allege the manufacturers violated U.S. antitrust laws by coordinating their actions rather than competing fairly. If the allegations are proven, similar conduct could also violate European competition rules. For now, the case is still in its early stages and no rulings have been issued. However, the case could have major implications for the entire tech industry.
Manufacturers reject the allegations, but history has seen similar cases
Companies named in the lawsuit deny allegations of price-fixing. Micron has already officially denied the charges, while Samsung and SK Hynix say the production changes result from huge demand for memory chips used by the artificial intelligence sector. It is worth remembering, however, that the memory industry has been involved in similar cases in the past. In 2005 Samsung and SK Hynix admitted to participating in a price-fixing conspiracy involving DRAM and paid multimillion-dollar fines. Some managers were then sentenced to prison terms for coordinating prices between manufacturers. The European Commission also conducted a similar investigation into the largest memory makers, imposing heavy fines. The current case, however, concerns a completely different market situation tied to the rapid development of artificial intelligence and rising demand for modern memory chips. The outcome of the lawsuit could affect not only semiconductor manufacturers but also the prices of electronics purchased by millions of consumers around the world.
Samsung, SK Hynix and Micron have been sued in the US on charges of creating a price-fixing conspiracy in the DRAM and NAND memory market. The companies deny the allegations, but confirmation of the claims could explain the causes of the sharp rise in prices for many electronic devices.
source: flatpanelshd
