4 ms·

It is because OpenAI bought 40% of the world’s production capacity overnight. RAM is like toilet paper during Covid now.

embedding-shape 11mo ago
And also because Korean companies apparently fear US retribution if they start producing DDR4. I don't feel like "OpenAI bought half the supply" tells the entire story when the companies that used to produce DDR4 with the left over machines no longer dare to do so. Probably the prices wouldn't spike as they're doing right now if the ones who used to produce the older RAM generations actually continued doing so.
- officeplant 11mo ago
  What do you mean by this? From everything I can find points towards other companies winding down DDR4 production because of China's cheaper DDR4 production lines.
  - embedding-shape 11mo ago
    It was brought up in a different HN submission about a week ago, here's the specific quote from the article: https://news.ycombinator.com/item?id=46169499 https://news.ycombinator.com/item?id=46169499 > Budget brands normally buy older DRAM fabrication equipment from mega-producers like Samsung when Samsung upgrades their DRAM lines to the latest and greatest equipment. This allows the DRAM market to expand more than it would otherwise because it makes any upgrading of the fanciest production lines to still be additive change to the market. However, Korean memory firms have been terrified that reselling old equipment to China-adjacent OEMs might trigger U.S. retaliation…and so those machines have been sitting idle in warehouses since early spring. - https://www.mooreslawisdead.com/post/sam-altman-s-dirty-dram-deal https://www.mooreslawisdead.com/post/sam-altman-s-dirty-dram... Every one seems so focused on that one company supposedly had "fake demand" just to ruin it for competitors, while the supply also seemingly is being suppressed, and no one seems to be talking about that. To me that seems like a much bigger deal, because then the market can't even restore the supply...
- tick_tock_tick 11mo ago
  Why would the USA care if Korean makes legacy DDR? You're going to have to give some kind of context to this completely wild statement.
  - _lvbh 11mo ago
    Korea wouldn't make them. They'd sell the machines to China & China would. At least that's what I've seen people say
  - embedding-shape 11mo ago
    https://news.ycombinator.com/item?id=46253185 https://news.ycombinator.com/item?id=46253185
prmoustache 11mo ago
The toilet paper thing didn't really happen though because there is so much shit people can produce at a time and the demand never increased if you scaled it to a 2 weeks period. There was enough stock in warehouses that 3 days later every store had a full stock again and the prices never increased.
- mc32 11mo ago
  True but office TP isn’t Charmin. So the demand for Scott would go down, but demand for northern quilted and Charmin would go up!
- adastra22 11mo ago
  Did we live through the same pandemic? At least where I live, there was shortages for weeks, and scarce for months. There was a real manufacturing shift that had to happen in the transition from commercial toilet paper to residential, which is made by totally different machines. The problem was real. It’s just that someone, seeing that real problem, triggered a panic buy that resulted in cleared shelves and a misallocation of the actual supply, making everything worse for everyone. In the present case, OpenAI just took 40% of the world’s supply off the market. That is massive, and will have implications for RAM availability for many industries. As a result, every other company immediately bought up as much supply as they could. Cars during Covid is probably the closer comparison, actually. A combined supply-drop followed by demand-shock resulting in skyrocketing prices and empty inventory.
  - asa400 11mo ago
    How much RAM should they be allowed to buy? Who should decide that?
    - redserk 11mo ago
      Perhaps a quantity below "a single company causes enough of a spike in global demand that it'll have demonstrable impact in nearly every single industry" And usually trade regulators would be the entity to start being concerned. I assume you're on a quest to assert a "let a completely unregulated free market roar" position, but do recognize that global supply issues of critical components have negative market effects, especially when it'll have some impact on nearly every industry except perhaps lawn care.

embedding-shape 11mo ago

And also because Korean companies apparently fear US retribution if they start producing DDR4. I don't feel like "OpenAI bought half the supply" tells the entire story when the companies that used to produce DDR4 with the left over machines no longer dare to do so. Probably the prices wouldn't spike as they're doing right now if the ones who used to produce the older RAM generations actually continued doing so.

officeplant 11mo ago
What do you mean by this? From everything I can find points towards other companies winding down DDR4 production because of China's cheaper DDR4 production lines.
- embedding-shape 11mo ago
  It was brought up in a different HN submission about a week ago, here's the specific quote from the article: https://news.ycombinator.com/item?id=46169499 https://news.ycombinator.com/item?id=46169499 > Budget brands normally buy older DRAM fabrication equipment from mega-producers like Samsung when Samsung upgrades their DRAM lines to the latest and greatest equipment. This allows the DRAM market to expand more than it would otherwise because it makes any upgrading of the fanciest production lines to still be additive change to the market. However, Korean memory firms have been terrified that reselling old equipment to China-adjacent OEMs might trigger U.S. retaliation…and so those machines have been sitting idle in warehouses since early spring. - https://www.mooreslawisdead.com/post/sam-altman-s-dirty-dram-deal https://www.mooreslawisdead.com/post/sam-altman-s-dirty-dram... Every one seems so focused on that one company supposedly had "fake demand" just to ruin it for competitors, while the supply also seemingly is being suppressed, and no one seems to be talking about that. To me that seems like a much bigger deal, because then the market can't even restore the supply...
tick_tock_tick 11mo ago
Why would the USA care if Korean makes legacy DDR? You're going to have to give some kind of context to this completely wild statement.
- _lvbh 11mo ago
  Korea wouldn't make them. They'd sell the machines to China & China would. At least that's what I've seen people say
- embedding-shape 11mo ago
  https://news.ycombinator.com/item?id=46253185 https://news.ycombinator.com/item?id=46253185

prmoustache 11mo ago

The toilet paper thing didn't really happen though because there is so much shit people can produce at a time and the demand never increased if you scaled it to a 2 weeks period. There was enough stock in warehouses that 3 days later every store had a full stock again and the prices never increased.

mc32 11mo ago
True but office TP isn’t Charmin. So the demand for Scott would go down, but demand for northern quilted and Charmin would go up!
adastra22 11mo ago
Did we live through the same pandemic? At least where I live, there was shortages for weeks, and scarce for months. There was a real manufacturing shift that had to happen in the transition from commercial toilet paper to residential, which is made by totally different machines. The problem was real. It’s just that someone, seeing that real problem, triggered a panic buy that resulted in cleared shelves and a misallocation of the actual supply, making everything worse for everyone. In the present case, OpenAI just took 40% of the world’s supply off the market. That is massive, and will have implications for RAM availability for many industries. As a result, every other company immediately bought up as much supply as they could. Cars during Covid is probably the closer comparison, actually. A combined supply-drop followed by demand-shock resulting in skyrocketing prices and empty inventory.
- asa400 11mo ago
  How much RAM should they be allowed to buy? Who should decide that?
  - redserk 11mo ago
    Perhaps a quantity below "a single company causes enough of a spike in global demand that it'll have demonstrable impact in nearly every single industry" And usually trade regulators would be the entity to start being concerned. I assume you're on a quest to assert a "let a completely unregulated free market roar" position, but do recognize that global supply issues of critical components have negative market effects, especially when it'll have some impact on nearly every industry except perhaps lawn care.