5 ms·

That's why some regulation is not the enemy of the people that some want to make it out to be. Unfortunately, I think regulatory capture is so deep now in most

• alex43578 3mo ago
  What’s the proposed regulation that would help here? Price controls? They don’t work, especially in a market like memory.
  • Matl 3mo ago
    > What’s the proposed regulation that would help here? Price controls? They don’t work. The proposed regulation would be that if a single company/industry buying up supply to the point it starts driving significant inflation for such and such goods, they would be severely restricted from doing so going forward.
    • Aurornis 3mo ago
      It’s a global phenomenon. The latency concerns for data centers are minimal, so they could be built anywhere. If your country restricted a company from buying too much of a product they need, 10 other competitor companies in other countries would be formed the very next day offering to do the work in their country for a minimal fee. This is a global market. Supply and demand isn’t going to be cancelled out by politicians in one country trying to squeeze the market. If you did restrict companies from buying things they need, you would see all future companies in that space incorporated in other countries.
      • testing22321 3mo ago
        The old race to the bottom.
        • Aurornis 3mo ago
          It’s the old supply and demand in a global market. It’s weird to read all of the calls for regulation to fix this when the DRAM and chip production is happening in other countries.
          • Danox 3mo ago
            On third of the Memory Stooges is in the United States...
      • JumpCrisscross 3mo ago
        Yeah, imagine doing that for oil. American and EU companies that “hoard” oil get punished. The net effect would be everyone else gets to buy more and prices remain exactly the same.
    • win311fwg 3mo ago
      So, in practice, if, say, the agriculture industry buys up the supply of seeds (they already effectively do) and we see it start driving significant inflation for food (a common concern), the agriculture industry would be restricted from buying seeds?
      • Matl 3mo ago
        Yes, because we can't apply specific regulation for specific industries where it makes sense, we have to write them as if we were LLMs so they can be proven to 'not work'.
        • win311fwg 3mo ago
          We can, but that isn't how the proposed regulation is written.
    • m4rtink 3mo ago
      Not saying this is the solution, but strategic reserves of important commodities exist. Maybe we need the same now for computer parts, that are now so important for everything in our modern digital society ? So that feverish investor speculation and shady circular financing deals don't cause sudden 30+% inflation on any technological device.
      • alex43578 3mo ago
        Good news, you get the DDR2 that has been languishing in a salt cave for the last 20 years. Reality check: a strategic reserve of modern technology components in volumes needed to impact consumer prices is completely infeasible and illogical. I’d be fine with the idea of the government maintaining supplies of defense industrial inputs, critical minerals, etc; but as we see with our efforts for rare earths (and even petroleum) you can never stockpile consumer supply levels.
      • sib 3mo ago
        A strategic reserve of a commodity that (historically) depreciates at ~50% per year is a terrible trade for occasionally avoiding demand-driven price spikes.
  • mghackerlady 3mo ago
    The only thing the US could feasibly implement is forcing micron to allocate a certain amount of its production for consumer use
    • alex43578 3mo ago
      Why? Why is consumer use vs corporate use a higher and better priority meriting such an intrusive regulation?
      • angoragoats 3mo ago
        Because extreme corporate use, that is, what is happening now where a majority of supply is locked up ahead of time via B2B back-room deals, is anti-consumer. Unregulated, it is easy to see how this could lead to a perpetual "rent everything" dystopian environment for consumers.
        • alex43578 3mo ago
          Every use of DRAM is a corporate use, with the best consumer-friendly examples like Apple’s efforts to hold down prices (until today) being thanks to “back room deals”. Nobody’s buying some DRAM to build a memory stick in their garage. Apple, Raspberry Pi, Supermicro, and OpenAI all have the same claim to supply you do: you can buy it with money, with the seller being allowed to charge what they want. In fact, high prices are going to be the only way to stimulate supply and encourage the billion dollar investment in additional memory fabs. Price controls or other supply-killing mechanisms are known not to work - it’s Econ 101.
          • angoragoats 3mo ago
            You ignored the part where I mentioned "extreme" and "locked up." To be fair I wasn't necessarily clear what those meant. I'm specifically referring to the deal(s) that OpenAI signed which reserved an outsized chunk of the memory supply, for what is apparently speculative future hardware that hasn't been built yet, or at least to build hardware that no consumer or business will ever be able to physically purchase. Hopefully you'll agree that there's a difference between even a large buyer like Apple reserving a large chunk of DRAM supply to put in their products that they sell to consumers, and the anti-competitive behavior by OpenAI that I describe above.
  • angoragoats 3mo ago
    Barring any single company from negotiating to buy more than a certain percentage of a given existing market of goods would be a start. Companies would still be free to build their own factories/fabs if they didn't like it. That, and putting Sam Altman in jail for being a lying fraudster.
    • Danox 3mo ago
      One or two companies will come out of this, designing and engineering memory and partnering with someone else to do the fab of that memory no different than making processor chips in Arizona.
  • Danox 3mo ago
    The market will take care of itself. The Chinese are going use this to ramp up and build more memory, and some companies out there will take it in-house, In short, they won’t be caught with their pants down again.
    • byzantinegene 3mo ago
      yes, this will give the Chinese a good opportunity to catch up.
• Aurornis 3mo ago
  > That's why some regulation is not the enemy of the people that some want to make it out to be. The question is always: What specific regulation? Regulation is not the magic silver bullet that some want to make it out to be. You’re not going to solve a global supply and demand change by regulating companies to not buy too many things. The supply would go to other countries. Companies would open international subsidiaries that built the data centers in other countries. Companies would move to other countries which didn’t try to stop them from buying components on the free market. You can’t regulate companies into keeping prices down. This is an international market. If you passed a law that said RAM had to be sold for no more than 30% higher than last year’s price, the international memory companies would laugh and stop sending RAM to that country. > Unfortunately, I think regulatory capture is so deep now in most places, one can hardly expect anyone to do anything about it. I think you need to broaden your understanding of how the DRAM supply chain works and which countries are involved. You can’t mandate low prices for a global commodity. You can try, but the supply will just disappear for that country.
  • Matl 3mo ago
    Yes, it's better to not do anything right? After all 'the market' is working for some. No regulation would catch 100% of this, nor is it meant to. But it can definitely deal with companies opening international subsidiaries etc. Sanctions can be worked around too, but that's a hassle and so countries/companies/individuals generally try to avoid them at all costs.
    • Aurornis 3mo ago
      > But it can definitely deal with companies opening international subsidiaries etc. You’re still imagining this as a purely single-country issue. The demand for AI data centers is global. If OpenAI, Anthropic, and xAI weren’t building them, other companies would step in to provide data center services for a fee. Now you have the same buildout, just less efficient and more expensive for the end consumers because we’re paying a new middleman for the compute. The regulation maximalists would argue that we could then forbid companies from buying foreign data center capacity, but then that means other companies would appear in those other countries offering the AI inference service. What you’re missing is that this is a global supply and demand issue and you can’t solve it with domestic regulations.
• slopinthebag 3mo ago
  What evidenced-backed regulation would solve this problem?
• mmcnl 3mo ago
  The AI "market" is not a free market. It needs regulation.