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Apple did not have to be in this situation. Begging for capacity lost to startups. Everyone else can complain, but not Apple. They had a 250B warchest, exactly

Apple did not have to be in this situation. Begging for capacity lost to startups. Everyone else can complain, but not Apple. They had a 250B warchest, exactly for such situations. Now somehow openAI has capacity and Apple does not. And think about it Apple is not in a better position than Valve for example. A teeny tiny company in comparison. It is an unprecedented managerial failure.

kshacker 3mo ago
Begging? Component price goes up, they increase their prices. Where's the begging? Just like US had oil but as the world prices went up, US oil prices went up. No one will sell it cheap inside the country for patriotism. Same thing here. Of course they likely had / likely have some issues, but we should explain it as market forces rather than any struggle they are facing.
- whatever1 3mo ago
  Is your thesis that Apple is planning for the same number of sales as the previous price? If not, they ordered less chips. Hence lost capacity.
  - kshacker 3mo ago
    No I don't have a thesis. About pricing, Netflix is constantly raising its prices and making more and more money (their stock is broken for last few months only) because they learned how to maximize profit by serving less customers but more profitable customers. Thats just one example. All I am saying is that price stability is not guaranteed and is not a corporate goal so whether they failed here, whether they regret something, it is not possible to judge that just from price increase. Maybe they did, maybe they did much better than we know today and will find out next year (or quarter).
    - goodluckchuck 3mo ago
      The difference is that Netflix isn’t facing a situation where they have run out of product to sell. If Apple wants to sell 10k laptops, they need to have 10k laptops. If 10k customers sign up for Netflix, Netflix gets that revenue and they can worry about optimizing their selection / service later.
calf 3mo ago
This is not Apple's fault and it is just the beginning of AI. Unlike every other software/algorithm/program known to mankind, AI based on neural networks threatens to extract exponentially the entire humanity's supply of computational capacity. Moore's Law hit a fundamental snag in the last decade (e.g. Dennard scaling) and cannot and likely will not keep up. This then would be the worst case scenario with serious long term consequences far beyond the price of consumer goods.
- martinald 3mo ago
  Micron said that they tried to tell 2 of their largest customers (one almost certainly Apple) that the prices they were demanding would result in the cancellation of a lot new construction in 2023, which wasn't in the industries best interests. It is sort of Apple's fault. They are probably the biggest single buyer of DRAM and NAND globally and they pride themselves on their supply chain management under Cook. It seems they over optimised this too far.
  - cm2012 3mo ago
    Apple is the most spendthrift of the rich tech companies.
    - Danox 3mo ago
      Would Apple be in a better spot now if they given Sam Altman 80 billion dollars like Microsoft?
goldenarm 3mo ago
Are you suggesting Apple should have invested in internal DRAM production?
- whatever1 3mo ago
  In the past they regularly have co-funded construction of fabs / nodes and getting exclusive access as a return.
- Danox 3mo ago
  Like SOC'S? Something is probably coming Motorola, IBM, Intel, AMD, Nvidia, Samsung, Qualcomm (out in 2027-2028), and Broadcom said no then Apple did something and replaced them the Apple Silicon design group can certainly do memory wasn't a company called Anobit bought by Apple years ago and money isn't a problem Apple didn't flush billions down Sam Altman's toilet like Microsoft. Timeline 2-3 years 10-20 billion dollars... Note:(Microsoft thru the end of this year will spend 60-80 billion dollars on Capex and Google will spend 180 billion dollars).
- MagicMoonlight 3mo ago
  [dead]
nikanj 3mo ago
Apple should have burned billions in cash, so that they would be able to sell RAM at below-market-rate prices? But why?
- bigyabai 3mo ago
  Because Apple doesn't sell socketed memory, but instead integrated SOC products that usually stimulate growth in their much more profitable services segment?

kshacker 3mo ago

Begging? Component price goes up, they increase their prices. Where's the begging? Just like US had oil but as the world prices went up, US oil prices went up. No one will sell it cheap inside the country for patriotism. Same thing here. Of course they likely had / likely have some issues, but we should explain it as market forces rather than any struggle they are facing.

whatever1 3mo ago
Is your thesis that Apple is planning for the same number of sales as the previous price? If not, they ordered less chips. Hence lost capacity.
- kshacker 3mo ago
  No I don't have a thesis. About pricing, Netflix is constantly raising its prices and making more and more money (their stock is broken for last few months only) because they learned how to maximize profit by serving less customers but more profitable customers. Thats just one example. All I am saying is that price stability is not guaranteed and is not a corporate goal so whether they failed here, whether they regret something, it is not possible to judge that just from price increase. Maybe they did, maybe they did much better than we know today and will find out next year (or quarter).
  - goodluckchuck 3mo ago
    The difference is that Netflix isn’t facing a situation where they have run out of product to sell. If Apple wants to sell 10k laptops, they need to have 10k laptops. If 10k customers sign up for Netflix, Netflix gets that revenue and they can worry about optimizing their selection / service later.

calf 3mo ago

This is not Apple's fault and it is just the beginning of AI. Unlike every other software/algorithm/program known to mankind, AI based on neural networks threatens to extract exponentially the entire humanity's supply of computational capacity. Moore's Law hit a fundamental snag in the last decade (e.g. Dennard scaling) and cannot and likely will not keep up. This then would be the worst case scenario with serious long term consequences far beyond the price of consumer goods.

martinald 3mo ago
Micron said that they tried to tell 2 of their largest customers (one almost certainly Apple) that the prices they were demanding would result in the cancellation of a lot new construction in 2023, which wasn't in the industries best interests. It is sort of Apple's fault. They are probably the biggest single buyer of DRAM and NAND globally and they pride themselves on their supply chain management under Cook. It seems they over optimised this too far.
- cm2012 3mo ago
  Apple is the most spendthrift of the rich tech companies.
  - Danox 3mo ago
    Would Apple be in a better spot now if they given Sam Altman 80 billion dollars like Microsoft?

goldenarm 3mo ago

Are you suggesting Apple should have invested in internal DRAM production?

whatever1 3mo ago
In the past they regularly have co-funded construction of fabs / nodes and getting exclusive access as a return.
Danox 3mo ago
Like SOC'S? Something is probably coming Motorola, IBM, Intel, AMD, Nvidia, Samsung, Qualcomm (out in 2027-2028), and Broadcom said no then Apple did something and replaced them the Apple Silicon design group can certainly do memory wasn't a company called Anobit bought by Apple years ago and money isn't a problem Apple didn't flush billions down Sam Altman's toilet like Microsoft. Timeline 2-3 years 10-20 billion dollars... Note:(Microsoft thru the end of this year will spend 60-80 billion dollars on Capex and Google will spend 180 billion dollars).
MagicMoonlight 3mo ago
[dead]

nikanj 3mo ago

Apple should have burned billions in cash, so that they would be able to sell RAM at below-market-rate prices? But why?

bigyabai 3mo ago
Because Apple doesn't sell socketed memory, but instead integrated SOC products that usually stimulate growth in their much more profitable services segment?