Micron locks in historically high memory prices for five years

https://www.theregister.com/systems/2026/06/25/micron-locks-in-historically-high-memory-prices-for-five-years/5261854

35•fauigerzigerk•2h ago

Comments

digitaltrees•1h ago

Predatory. I hope the tech community remembers this and diversifies away from companies that behave this way

naturalmovement•1h ago

Yeah they're going to diversify... to one of the other two memory companies who will likely be raising their prices too, because why should they be suckers?

small_model•1h ago

The suckers are those companies agreeing to this deal. 'Your margin is my opportunity' means prices will fall eventually once more production come on line. The invisible hand will slap their faces

try-working•58m ago

nobody is agreeing to what the headline says. the SCAs are just a hedge against even higher prices. the agreements will be broken the second prices drop.

regularfry•22m ago

"Eventually" doing a lot of work. Micron (and implicitly anyone signing this deal) are betting demand is going to outstrip capacity for several years, taking into account what new capacity can be brought online and when.

rob74•7m ago

Well, apparently those companies believe memory prices will continue to rise, so they'd better lock in supply at the current (high) prices. We'll see if they're right...

baal80spam•47m ago

> I hope the tech community remembers this and diversifies away

Doubt it. Has it EVER happened before?

dygd•21m ago

It feels different this time. I bet there will be a generation of PC enthusiasts that are going to remember Crucial exiting the consumer market to chase AI dollars. And similar, when they hear Micron/Samsung/Sk Hynix, they'd be wary of the price gouging. Gamer's Nexus is doing really good job exposing the DRAM cartel.

https://www.youtube.com/watch?v=jVzeHTlWIDY

striking•28m ago

https://en.wikipedia.org/wiki/DRAM_price_fixing_scandal

> To date, five manufacturers have pleaded guilty to their involvement in an international price-fixing conspiracy between July 1, 1998, and June 15, 2002, including Hynix, Infineon, Micron Technology, Samsung, and Elpida.

It is history; we have not learned; we are doomed to repeat it.

baq•22m ago

waiting for you[0] to lay the $10B on the table for a new DDR fab - there's only so long I can wait for a new PC for the kids

[0] can actually be anyone

cm2187•21m ago

Why? Part of the problem is that chip manufacturers (from tsmc to to memory makers) are reluctant to ramp up production as the AI bubble may pop and they would find themselves with huge over capacity, a scenario they have gone through many times.

By giving them stability of cash flows, the AI companies are enabling them to make those investments and to ramp up production. That's a good thing, not a bad thing. Over time it should ease the squeeze on chips.

alentred•1h ago

That's ... just sad.

rawling•1h ago

https://news.ycombinator.com/item?id=48676382

try-working•59m ago

wishful thinking from MU holders. These LTAs or SCAs are just hedges on the prices going even higher. Once spot prices start dropping, all of the agreements will be broken in a millisecond. The break up fees have already been paid! There's absolutely nothing the buyer has to do, but to simply not buy at the inflated old price and instead buy from someone else at the new, lower price.

Does anyone really think that there is any agreement in the world that will keep companies paying $1000 for a product priced at $20 on the market? The larger the gap the larger the incentiv to break the agreement.

wjnc•39m ago

I think you are right but would like to keep in consideration that penalty clauses are real and can be enforced in court. We have no (or perhaps: have some) clue how far the bargaining power is leaning toward the suppliers. Maybe the signatories in the SCA are so cornered, they will sign anything and think ‘boom or bust’.

cm2187•23m ago

The article says a large part is paid upfront.

alxfrnr•4m ago

"consolidated gross margin came in at 84.9 percent"

They are in saas metrics territory in terms of margins, this is insane.

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