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>market that Micron, Samsung and SK Hynix are abandoning to chase the AI server market These three have collectively committed what, approaching $50B towards c

>market that Micron, Samsung and SK Hynix are abandoning to chase the AI server market These three have collectively committed what, approaching $50B towards construction of new facilities and fabs in response to the demand? The memory industry has traditionally projected demand several years out and proactively scheduled construction and manufacturing to be able to meet the projected demand. The last time they did that, in the crypto boom, the boom quickly turned into a bust and the memory makers got burned with a bad case of oversupply for years. With that context, can you blame them for wanting to go a bit more slowly with this boom? Sure, the new fabs won't be up and at volume production until late 2027 / early 2028, but committing tens of billions of dollars to new production facilities, including to facilities dedicated to DRAM rather than NAND or HBM, is hardly 'abandoning'. They're pivoting to higher profit margin segments - rational behavior for a for-profit corporation - but thanks to the invisible hand of the (not quite as free as it should be) market, this is, partially, a self-solving issue, as DRAM margins soar while HBM margins compress, and we're already seeing industry response to that dynamic, too: https://www.guru3d.com/story/samsung-reallocates-of-hbm3-capacity-to-produce-ddr5-lpddr6-and-gddr-chips/ https://www.guru3d.com/story/samsung-reallocates-of-hbm3-cap...

ZenoArrow 9mo ago
> Sure, the new fabs won't be up and at volume production until late 2027 / early 2028, but committing tens of billions of dollars to new production facilities, including to facilities dedicated to DRAM rather than NAND or HBM, is hardly 'abandoning'. Look at what happened to Crucial. Why would Micron axe it's whole consumer RAM division if it was just experiencing a temporary drop in DRAM supplies until new fabs were brought online? Samsung and SK Hynix may have changes in priorities in the coming years, and in the case of Samsung I'm sure they'll still make sure to supply sufficient DRAM chips for the devices it manufactures (phones, TVs, etc...) but Micron has made it's current intentions fairly clear. They'll probably work with OEMs, but they're unlikely to return to selling to the general public any time soon.
- direwolf20 9mo ago
  What makes you think it won't start selling it as Micron brand or even Crucial brand once the bubble pops?
  - ZenoArrow 9mo ago
    What makes you think consumers would want to trust them again after they were abandoned previously? Consumers would rather vote with their wallets for companies that are going to continue giving them good deals. The only reason Micron has a chance to pivot back to consumer RAM is because there's not much competition, but that could change if the Chinese RAM manufacturers can make inroads into western markets and continue their rapid technological growth.
    - direwolf20 9mo ago
      Because there isn't room for reputation here. The RAM works, or it doesn't. It costs a certain price. Do you want to spend more money, or less money?
      - ZenoArrow 9mo ago
        > Because there isn't room for reputation here. The RAM works, or it doesn't. It costs a certain price. Do you want to spend more money, or less money? RAM from China already works and as Chinese RAM manufacturers scale up there's no reason they can't be competitive on price. Furthermore, it's more than possible for China to catch up technologically as well. Micron is likely to regret pissing off the majority of their customers if Chinese RAM manufacturers start aggressively targeting the market Micron have left behind, how bad this gets for Micron depends on how quickly they pivot back to the general consumer market.
        direwolf20 9mo ago
        I hope China overtakes the US just as it did in almost every other market. The US will fail, as it has chosen to.
      - 9mo ago
ls612 9mo ago
This is the classic commodities cycle, and it happens everywhere in an economy where aggregate supply is inelastic in the short term but aggregate demand can fluctuate quickly. The reason it’s coming for DRAM first is that memory is the closest part to a pure interchangeable commodity and that recent process nodes have had almost zero improvement to memory density for years now, despite logic density continuing to increase exponentially. That and these companies have been known to fix prices in the past, but in this case the evidence suggests it’s a large aggregate demand shock.

ZenoArrow 9mo ago

> Sure, the new fabs won't be up and at volume production until late 2027 / early 2028, but committing tens of billions of dollars to new production facilities, including to facilities dedicated to DRAM rather than NAND or HBM, is hardly 'abandoning'. Look at what happened to Crucial. Why would Micron axe it's whole consumer RAM division if it was just experiencing a temporary drop in DRAM supplies until new fabs were brought online? Samsung and SK Hynix may have changes in priorities in the coming years, and in the case of Samsung I'm sure they'll still make sure to supply sufficient DRAM chips for the devices it manufactures (phones, TVs, etc...) but Micron has made it's current intentions fairly clear. They'll probably work with OEMs, but they're unlikely to return to selling to the general public any time soon.

direwolf20 9mo ago
What makes you think it won't start selling it as Micron brand or even Crucial brand once the bubble pops?
- ZenoArrow 9mo ago
  What makes you think consumers would want to trust them again after they were abandoned previously? Consumers would rather vote with their wallets for companies that are going to continue giving them good deals. The only reason Micron has a chance to pivot back to consumer RAM is because there's not much competition, but that could change if the Chinese RAM manufacturers can make inroads into western markets and continue their rapid technological growth.
  - direwolf20 9mo ago
    Because there isn't room for reputation here. The RAM works, or it doesn't. It costs a certain price. Do you want to spend more money, or less money?
    - ZenoArrow 9mo ago
      > Because there isn't room for reputation here. The RAM works, or it doesn't. It costs a certain price. Do you want to spend more money, or less money? RAM from China already works and as Chinese RAM manufacturers scale up there's no reason they can't be competitive on price. Furthermore, it's more than possible for China to catch up technologically as well. Micron is likely to regret pissing off the majority of their customers if Chinese RAM manufacturers start aggressively targeting the market Micron have left behind, how bad this gets for Micron depends on how quickly they pivot back to the general consumer market.
      - direwolf20 9mo ago
        I hope China overtakes the US just as it did in almost every other market. The US will fail, as it has chosen to.
    - 9mo ago

ls612 9mo ago

This is the classic commodities cycle, and it happens everywhere in an economy where aggregate supply is inelastic in the short term but aggregate demand can fluctuate quickly. The reason it’s coming for DRAM first is that memory is the closest part to a pure interchangeable commodity and that recent process nodes have had almost zero improvement to memory density for years now, despite logic density continuing to increase exponentially. That and these companies have been known to fix prices in the past, but in this case the evidence suggests it’s a large aggregate demand shock.