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Sony Under Investigation by DOJ

Posted by Zonk on Tue Oct 31, 2006 10:31 AM
from the can't-a-megacorp-get-a-break dept.
Government Sony The Courts Hardware News
An anonymous reader writes "As the DOJ continues its investigation into RAM price fixing, it has started looking at Sony's operations. With all the negative press Sony has been getting, this couldn't come at a worse time." From the article: "The Japanese company received a subpoena from the Justice Department's antitrust division seeking information about Sony's static random access memory, or SRAM, business, company spokesman Atsuo Omagari said. 'Sony intends to cooperate fully with the DOJ in what appears to be an industrywide inquiry,' the company said in a short statement."
+ -
story

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[+] Your Rights Online: Infineon Execs Plead Guilty to Price-Fixing 195 comments
An anonymous reader writes "Executives at Infineon Technologies plead guilty to an international conspiracy to fix prices in the DRAM market. Heinrich Florian, Günter Hefner, Peter Schaefer and T. Rudd Corwin, executives for Infineon Technologies, had a felony filed against them yesterday in the U.S. District Court in San Francisco. Each executive could spend up to six months in prison and will have to pay a $250,000 fine. Under the plea agreement, they must also assist the government in its DRAM investigation. Infineon agreed in October to pay a $160 million fine for its role in the conspiracy, according to the Justice Department."
[+] Technology: RAM Manufacturers Fined for Price Fixing 216 comments
TufelKinder writes "From Law.com: 'In the largest fine ever obtained by San Francisco antitrust prosecutors, a Korean company has agreed to plead guilty and pay $185 million for its role in a conspiracy to drive up the price of computer chips.' Micron and Infineon have also been fined for their role in the scheme." From the article: "It's the third-largest fine of its kind in the United States, and it could be just a preview of even bigger penalties. The far-reaching computer chip investigation, which alleges wrongdoing from 1999 through 2002, affects thousands of consumers."
[+] DRAM Makers Accused of Price Fixing 177 comments
AdamWeeden writes "According to the EETimes, many of the states in the U.S. have entered into a class-action lawsuit against a group of eight DRAM manufacturers. The companies are accused of price-fixing computer memory for over five years, beginning in the late 1990s." From the article: "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."
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Sony Under Investigation by DOJ 50 Comments More /

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  • Ram is going to get cheaper
    Hooray! Ram! Ram! Ram! Ram!
    Cheaper, faster, bigger, smaller
    Hooray! Ram! Ram! Ram! Ram!
    Now that people aren't makin' it expensive
    Hooray! Ram! Ram! Ram! Ram!
    It's gonna get cheaper!
  • Soon we will learn that all VAIOs are made from the souls of slaughtered orphans.

  • Are you sure isn't not just (Score:1, Interesting)

    by Anonymous Coward
    ...the author of TFA that's painting the ugly picture on this issue?

    "As the DOJ continues its investigation into RAM price fixing, it has started looking at Sony's operations."

    "'Sony intends to cooperate fully with the DOJ in what appears to be an industrywide inquiry,' the company said in a short statement."

    So in other words...

    DOJ: "Let's see... next on the list is... Sony, you're up."

    Greimel: "Lookit! Sony fucks up yet again, and then there's a PS3, and the 'sploding batteries, and Iwo Jima, and..."

    Really

    • I'm sure price-fixing is industry-wide (Score:5, Insightful)

      by Red Flayer (890720) on Tuesday October 31 2006, @11:00AM (#16658659) Journal
      "As the DOJ continues its investigation into RAM price fixing, it has started looking at Sony's operations."
      "'Sony intends to cooperate fully with the DOJ in what appears to be an industrywide inquiry,' the company said in a short statement."
      So in other words...
      DOJ: "Let's see... next on the list is... Sony, you're up."
      Well, how could a price-fixing inquiry NOT be industry-wide? The whole mechansim of price-fixing is that you get everyone in the industry to set prices at an artificially high level. Any industry member who didn't participate would break the scheme, as long as they had the production capacity.

      So, when people say that Sony isn't being singled out, that they're just one of many... that's exactly the point of the investigation.
        • Well, first, if you're going to post like such an ass, you should at least have the cojones to not post as AC.

          Second, did you read the article? Was the article not specifically about the DOJ's initiation of investigations into Sony Electronics? Did the article even give more than a passing nod to other companies that the DOJ is currently investigating? Did you even RTFA?

          Why are YOU upset that the summary reflects the article? Just because the focus of the article happens to be Sony? Or because you e
        • IIRC, you're absolutely right. Either way, though, it requires collusion to set the price at an artificial level in order to derive some non-competitive advantage (in this case, to drive Rambus OOB).
    • Greimel: "Lookit! Sony fucks up yet again, and then there's a PS3, and the 'sploding batteries, and Iwo Jima, and..."

      You forgot the BMG-Sony rootkit.

      I really resented that.

  • Little do they know (Score:2, Funny)

    by Anonymous Coward
    'Sony intends to cooperate fully with the DOJ in what appears to be an industrywide inquiry,' the company said in a short statement.

    The DOJ is expected to find that all evidence shows Sony to be innocent, all thanks to Anne in accounts who played a recent Celine Dion CD on her workstation.

  • Nice try, Zonk. Nothing to see here, move along.
    • Nothing to see here, move along.

      Can I modify my /. settings to auto-post this for every new story? :)

      (I am not making a statement about the quality of the stories; I am making a statement about how often I've seen this lately.)

  • Wow static ram.. is that still around and used by someone?
    • CPU Cache. Router buffers. CMOS RAM. Hard disk buffers. CD and DVD drive buffers. Static RAM is used anyplace where speed or low power consumption are important. Slow static RAM uses less power than DRAM, while fast static RAM is much faster than DRAM.
  • just another sign the God wants the PS3 to fail and the evil mother company perish.
  • Investigations into the Blue Laser shortage. Seriously though, what the heck is going on at Sony, first its the Batteries, then the "laser shortage" and overpriced console, now its price fixing? When I was a kid sony stood for unequaled quality and innovation, now it seems to stands for "might last until the warranty expires, if your lucky". What has changed?
    • So in other words...

      "Say it ain't so, Blu-Ray... Say it ain't so!"

    • Re: (Score:1, Insightful)

      by Anonymous Coward
      Don't forget the Sony CCD sensor recall which affected almost 190 digital camera and camcorder models from eight manufacturers, as well as certain other products such as PDAs with built-in digicams.
      • wow that would be a meaningful reply if I owned an xbox or an xbox360 but currently all I have is a PS2 (my second one...the first one died) and a Gamecube...try again.
      • Your very lucky, I have a dell laptop that didnt explode in the nearly two years I've owned it to, but I still sent the battery back. I've gone through 2 ps2's the one have now is flakey (reads disks most of the time, sometimes the lights on the front just flash, have no idea what thats all about). I never said all sony products will die on you it just seems their quality control has gone to crap, like most everyone else's.
  • After their rootkits on CD's I'm surprised that the DOJ hasn't been chasing these guys more aggresively.
  • IIRC, there have been lots of articles talking about industry-wide price fixing of SRAM. Many companies actually admitted to doing so, especially in the late 90's. Just glance at the related stories.
  • Well, but isn't feasibility of imports a mitigating factor when looking for collusion evidence? I mean, is it possible to fix prices for SRAM, given its low degree of differentiation? Is the distribution channels and contracts with OEMs such a bottleneck in the downstream?
    • Collusion to fix prices is only really possible in the situation you describe: the product is a commodity. If producers can differentiate their product on something other than price - quality, location, etc - and charge more for it than the comparable products, then there is no incentive for that producer to join a price fixing scheme. But when products are a commodity, there is nowher to compete BUT on price. Hence, producers get together and artificially set the price higher than it would otherwise be,
  • Static RAM? COME ON, SLASHDOT! You aren't even trying anymore!
    • What's wrong with static RAM?

      From wikipedia: [wikipedia.org]

      SRAM is faster than DRAM and is used where speed is the prime requirement such as in CPU caches and router buffers. It is also used for external caches, DRAM burst circuits and in its dual-ported form for digital signal processing circuits. Modern FPGAs contain significant amounts of embedded SRAM.

      Slow, low-capacity SRAMs are used where low power consumption and low cost are the most important requirements, as in battery-powered backup RAM. SRAM is less dens

      • It makes no since that people spend there time studying English, sense its clear their not learning they're own language

        "Their", as in "Their time is valuable." "There" as in "There is a bear there" "They're" as in "They're running out of time" Before criticizing someone's grammar, be sure that your own is correct.

        woooooooOOOOOOOOOOOOOOOOOOOOOOOOOSH!!!

        Also, you missed "sense" and "it's." You completely fail at naziism.

  • With all the negative press Sony has been getting, this couldn't come at a worse time

    Or couldn't come at a better time.
  • If anybody thinks this will amount to much, really?
    "You there, at the back, you have your hand up, no? Oh it's your hat, sorry my bad."
  • That's all; just a Sony-coined phrase that has literally come full circle to describe the very company that used it to begin with.

  • Even though recently Sony has been making a lot of fudge-ups and bad press, I kind of feel bad that Sony's having to deal with this now. This is the company that fought for better quality video [wikipedia.org], made portable audio a lifestyle [wikipedia.org], and innovated/invented several concepts that we could not live without. My family and I trusted the Sony brand for years, and it will be sad to see them getting closer and closer to another great example of a management failure in our business classes.

    • Yeah, because we wouldn't expect a quote from Sony about the status of a DOJ investigation into Sony to be, you know, biased anything.

      -stormin
    • Holy FUD Batman!

      Hey, leave me out of this!
    • FTA:

      "Earlier this month, U.S.-based chipmaker Cypress Semiconductor Corp. said its SRAM operations were also under investigation by the U.S. Department of Justice."

      That's one other company under investigation. Maybe the investigation is industry-wide, maybe it's not. There's no reason to assume Zonk is more biased than Sony. I mean, who could possibly be more biased about the fate of Sony than Sony?

      In any case "everyone else was pricefixing too" (or whatever the charges, if any, turn out to be) is hardly likely to make the damage of this story go away. We've got ridiculous PS3 prices, the whole Sony DRM fiasco, the exploding laptop batteries, and now this. Even if this was an industry-wide problem, it's not like Cypress Semiconductor Corp has exactly had front-page news of any kind recently. This is like strike 4 for Sony, strike 1 for everyone else. The fact of the matter is that Sony is far, far more vulnerable to this press than another company due to both previous bad press and the vulnerable financial position they're in running up to the launch of the PS3.

      I think I see vultures starting to circle...

      -stormin
      • Except that you're comparing two companies that are structured in completely different ways. Sony has several divisions: games, music, movies, electronics, with a wide variety of products in each category. Cypress Semiconductor Corp makes....semiconducturs. It's all they do, that's what they're known for. The DOJ is going after Sony Electronics, which is sort of the "sub corporation" that makes the memory. They have nothing to do with "ridiculous PS3 prices" (did they get sued for this?), or the DRM fias
        • Except that you're comparing two companies that are structured in completely different ways

          Do you really think that matters? I realize that Sony is a conglomerate of rather disparate companies - but so far it looks as though all have of them have been misbehaving. Furthermore, that's kind of the breaks of sharing a brand identity. You sink or swim together.

          Even though electronics has nothing to do with, say DRM, when either screws in an extremely public fashion up it's bad for the other. And when all th

        • Except that you're comparing two companies that are structured in completely different ways. Sony has several divisions: games, music, movies, electronics, with a wide variety of products in each category. Cypress Semiconductor Corp makes....semiconducturs. It's all they do, that's what they're known for.

          This is one of the downsides to being a conglomerate. Perhaps the bad press about Sony combined with loss of market share across the board might encourage other companies not to overdiversify.

          Bad press

      • I agree Sony's other problems add to this, but as for those questioning the "industry-wide" aspect of this news, consider this: it's not price-fixing if it's just one company involved. Seeing all the other price-fixing stories out of the semiconductor industry recently, of COURSE it's an industry-wide investigation.

        • You do have a point that if it's price fixing there's more than one company involved. For price-fixing to work you have to have collusion on a near-monopoly scale. That means you have to have enough market share to get a monopoly. It does not mean you need the entire industry - especially if you're counting by company as opposed to market share. One or two "giants" with 40% each of the market can collude, leaving a dozen small companies out in the cold. Furthermore, one company can shoulder more respon
      • In any case "everyone else was pricefixing too" (or whatever the charges, if any, turn out to be) is hardly likely to make the damage of this story go away. We've got ridiculous PS3 prices, the whole Sony DRM fiasco, the exploding laptop batteries, and now this. Even if this was an industry-wide problem, it's not like Cypress Semiconductor Corp has exactly had front-page news of any kind recently. This is like strike 4 for Sony, strike 1 for everyone else. The fact of the matter is that Sony is far, far mor
        • Yeah, but you got to think another 2-3 or 6-7 big headline news stories like this and how long will it take for people to just ignore most news about Sony?

          I don't think it will work like that. Humans like narratives. We like good guys and bad guys. These news stories are definitely putting Sony more and more as "the bad guy" instead of "company with great products". Consumer anger, in my limited experience, works on a kind of tipping-point basis. No one really cares until it hits a point where it becom

    • Re: (Score:1, Interesting)

      by Anonymous Coward
      "So the DOJ appears to be investigating every manufacturer..."

      Incorrect.

      "....and there is no info even hinting that Sony did everything wrong."

      Not coherent enough to be incorrect. It's a story about the impact of a DOJ SRAM (as opposed to the DRAM part which apparently caused your 'every manufacturer' confusion) investigation into a long and established company already suffering a number of other self-inflicted wounds. Why the tizzy, do you own Sony stock bunky?

      For my part, Son

    • Re: (Score:3, Insightful)

      by Red Flayer (890720)

      "Sony intends to cooperate fully with the DOJ in what appears to be an industrywide inquiry," the company said in a short statement. (Emphasis mine).

      I'll amend your selective emphasis a bit:

      Sony intends to cooperate fully with the DOJ in what appears to be an industrywide inquiry," the company said in a short statement.

      Does it look a little different now? I think we've all learned to never take the statements of a company under investigation at face value -- they've shareholders and executives to protect,

      • Does it look a little different now? I think we've all learned to never take the statements of a company under investigation at face value -- they've shareholders and executives to protect, after all.

        Ok, how about taking the company statement with a teensy bit of logic:

        Either Sony fixed prices for all companies all by themselves, or the investigation does comprise a signifcant portion of the manufacturing base.

        My monkey brain selects number two. This knee-jerk Sony-bashing stuff is getting kind of

        • This knee-jerk Sony-bashing stuff is getting kind of weird.

          I don't think it's weird -- I think it's a natural reaction to the comedy of errors that is currently Sony. Sony has destroyed their brand reputation among a significant subset of their consumer base by shipping defective product, by attempting to cover that up, by shipping product with consumer-harming add-ons, by making poor management decisions, by making promises they can't keep... etc.

          Sure, some people take it a little far -- but it's Sony t

    • >>"Sony intends to cooperate fully with the DOJ in what appears to be an industrywide inquiry," the company said in a short statement. (Emphasis mine).
      >So the DOJ appears to be investigating every manufacturer, and there is no info even hinting that Sony did everything wrong.

      So, you feel that Sony's spin on this is highly credible? It also seems to me that allegations of price fixing might involve more than one company in an industry, since it would be pretty hard for a single company to fix

    • Yup, the DOJ went industry wide with their search for wrongdoing and found that it was Sony that stunk the most.

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