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Jachyra007

DRAM Makers Accused of Price Fixing

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"Four companies and 12 executives have so far pleaded guilty to participating in the conspiracy and have been assessed more than $730 million in fines. In May, three of the four companies, Samsung Electronics, Hynix Semiconductor Inc. and Infineon Technologies AG agreed to pay a total of $160 million to settle class action suits related to price fixing. Elpida Memory Inc., the fourth company to plead guilty, is still involved in the class-action suits."

 

Doesn't surprise me - I'll bet 95% of all industries participate in some form of price fixing.

 

Who the crap is Elpida anyways? (yeah I'm googling it right after this....)

 

Edit: Actually it looks like this lawsuit has been happening for some time now.

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Doesn't surprise me - I'll bet 95% of all industries participate in some form of price fixing.

 

Who the crap is Elpida anyways? (yeah I'm googling it right after this....)

 

Edit: Actually it looks like this lawsuit has been happening for some time now.

lol its the worse memory ever made. every time i see a problem on a nf3 board and look i see Elpida :)

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If people voluntarily pay a price for a good or service, who the hell is the government to say "no, you paid too much"?

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If people voluntarily pay a price for a good or service, who the hell is the government to say "no, you paid too much"?

 

There is a difference between the economically balance price the 'market will bear' and a group of corporate execs from competing companies meeting together and deciding that '...the minimum price for this class of part is X' or '...the price range we will all charge for this part is X to Y'. While easy to catch at the retail end, it's hard to know what's going on at the wholesale level... think fuel prices, which have regional differences that are not explained by transportation or regulation costs.

 

Computers are no longer optional, they're a necessity for a majority of jobs... so everyone HAS to use them to function and one can't reasonably choose not to use a computer, so price fixing and collusion on pricing are potentially harmful to the consumers (all of us) and the economy (the costs get passed on to everyone using a computer.

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I find the collusion argument uncompelling. Competing companies will always try to undercut each other. Historically, the first company to pull out of the cartel has profitted handsomely while the others scramble to catch up, and eventually the price resettles into equilibrium.

 

Accusations of price fixing are remarkably similar to calls for price caps, IMO, and price caps are remarkably disruptive to economies. Now that there's some sort of government-mandated ceiling on acceptable RAM prices, potential competitors will be less inclined to enter the market, as there are fewer incentives. The "guilty" companies themselves have reduced incentive to innovate, out of fear that they'll get smacked again.

 

The government can't even balance its own budget; why do we think it's capable of determining the proper price (or what is not a proper price) for RAM?

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15 years from now they will tell us what TP to wipe our a$$s with

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a while ago, there was winbond, making chips for infineon. Kingston was infineon's major customer. Winbond stuck a deal direct with kingston, after infineon reneged on an order, and the ensuing battle ended up seeing the Dramurai raising prices by 500%, while thier cost got lower and lower. typically when companies make thier production line better, they pass the savings on to consumer, but this time they simply stuffed thier pockets.

 

Anyway, in order to not be in such conflict, the dramurai agreed to sell chips @ the same price...a raised price...and the price fixing was set in stone.

 

Before ever going to court on this, Samsung set aside a large chunk of cash...and when they walked out of the couirtroom the final day of thier trial, they paid that exact amount they had set aside earlier.

 

Corruption at it's finest.

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Price fixing is not a unusual occurence in just about any market. Heck, even famous auction houses did the same thing.

 

Search for "Christie Price Fixing" on Google.

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Guest Kobalt

This will be the case of lawyers making $100 million in "fees", and the consumers get a free program to check the memory from memtest86.com.

 

Great deal! :rolleyes:

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This will be the case of lawyers making $100 million in "fees", and the consumers get a free program to check the memory from memtest86.com.

 

Great deal! :rolleyes:

 

 

...now THIS I believe totally. On a side note, that big US lawsuit against the tobacco companies has helped the average citizen here how at this point?

 

But I note that many lawyers on that case walked off with about 300 Million a piece.

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If people voluntarily pay a price for a good or service, who the hell is the government to say "no, you paid too much"?

 

The problem is that some companies realize the profitablity of price fixing and won't undercut each other. Lets say 2 companies make AIDS medicine. If they actually strike a deal with each other, they have no reason to undercut each other because its a necessary service.

 

In any necessary service, price fixing is very dangerous. Even the auto industry (consider that America has the highest ratio of cars to people) would be dangerous if they price fixed.

 

You may think, "well, there are a lot of brands..." Truth is, there are only 3 automakers in America. Ford, GM, Daimler-Crystler. There is a lot of potential for abuse.

 

-----------------------------------------------------------------------

 

Even if the market did settle, after how long? 1 week, 1 month, 1 year, 1 decade? There isn't any way to tell. During this time stagnation would occur. Would you buy RAM priced at $1000 per 512 stick? Or would you decide its not worth the cost?

 

Lot of factors at play. But the determing factor is whether the product/service is necessary.

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