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Oversupply Sends DRAM Prices To One-Year Low 161

alphadogg writes "DRAM chip prices reached a one-year low on Tuesday and approached their cheapest ever due to a post-holiday oversupply. The cheap memory chips are pushing PC prices lower too, a Taiwan-based trading platform said. Prices for commodity 1-Gbit DDR3 DRAM chips dropped to an average of $0.84 per unit from historic highs around $2.80 in April and May last year, said Ivan Lin, publicist and editor with DRAMeXchange. Prices hit a record low of $0.81 per chip in March 2009, according to the exchange's daily surveys."
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Oversupply Sends DRAM Prices To One-Year Low

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  • by smittyoneeach ( 243267 ) * on Tuesday January 04, 2011 @10:48AM (#34753760) Homepage Journal
    Would that Scotch,
    Were so cheap by the DRAM,
    A shave, a shot, a gig;
    Still change for the tram.
    Burma Shave
    • Re: (Score:2, Insightful)

      by Anonymous Coward

      Who're the fucking killjoys who moderated that Offtopic?!

      That comment is pure gold. Best FP I've seen in a while. And I've made +5 Funny first posts myself, so I believe I might just know what I'm talking about when I say that comment deserved at least +6.

      Mods, get your heads screwed on straight and grow a sense of humour.

      Posting anon because this is offtopic and I know it. Meh.

      • Re: (Score:2, Redundant)

        by h4rm0ny ( 722443 )
        I've made +5 Funny Posts myself, and can therefore guarantee they mean bugger all.
  • by Hatta ( 162192 )

    Does this apply to DDR2 chips? It's almost at the point where it would be more economical to buy a new mobo and ram than it would be to add ram to a not that old board.

    • by alen ( 225700 )

      i doubt it since almost everyone is making DDR3 these days and DDR2 is only the more expensive older assembly lines

      • by Nadaka ( 224565 )

        Where is this oversupply of DDR3? Only available online? Go to an electronics store and you see racks full of DDR2 and empty racks for DDR3?

    • by rwa2 ( 4391 ) *

      Fortunately (?) a lot of DDR2-era motherboards were affected by that huge batch of bad capacitors, so it might not be a bad idea to replace your mainboard before one of them fail.

      Of course, I'd still feel compelled to pull together enough spare parts to build a machine around the old mainboard anyway... 'sigh' the many trappings of spending money on things computer-related :-/

      • by CAIMLAS ( 41445 )

        Actually, those were DDR era motherboards, mostly (assuming you're thinking of the "bad cap" foxconn debacle around 2003). We're talking 2.4-3GHz P4 era stuff, when 1GB was still considered "a lot", before Vista came to the scene.

        I still have (and use) a 550W Antec PSU that has bad, leaked caps in it from that era. The leads test good under load still. Bad caps were/are not a death knell to the hardware. Likewise, I've got a Dell Optiplex 270 which has that problem (and an underclocked CPU) but runs stable

        • You're asking for trouble. When those caps finally do give up the ghost they could potentially fry anything attached to the power supply!
          • by CAIMLAS ( 41445 )

            It's an 8-year-old system with old crap attached. Anything important is NFS mounted. I'm not too concerned.

      • the many trappings of spending money on things computer-related :-/

        Consider those trappings a tax on the stupid.
    • I wish -- though it still makes sense that, if you have more than one DDR2 motherboard in operation, to replace just _one_ and then use the leftover DDR2 sticks in the other to add ram.

    • I just checked and it looks like it has. I was contemplating upgrading from 4x2GB of DDR2-667 to 4x4GB, and I think the price of 16GB kits was between $400 and $500 (median) with individual 4GB sticks going for $100-$120. I see now that there are some cheaper 4GB DDR2 sticks going for around $75. Although, that's still $300 right there, which is right at what I paid for a new mobo + 16GB of DDR-1600. I don't know if prices will go any lower though ... AFAIK most places are trying to ramp down production

      • by devjoe ( 88696 )
        Yes, this is exactly the issue - 1Gbit ram chips make 1GB ram sticks, and most people are beyond the point of adding more 1GB sticks. The only use for these now is in the two or three 1GB sticks that manufacturers put in new low-end systems. The article is very deceptive since the prices of bigger ram chips/sticks have not fallen by anywhere near as much, though they have fallen.
        • by yuhong ( 1378501 )

          Except that you can use both sides to fit 16 of them, which would result in 2GB sticks

        • by Amouth ( 879122 )

          1 Gbit != 1 GB

          8*1Gbit = 1 GB

          last i checked normal form factor could fit 16 chips so 2GB stick... after that you have to go to higher density.

          last i checked 2GB on a stick was still a decent amount.

    • Re:DDR2? (Score:4, Insightful)

      by CAIMLAS ( 41445 ) on Tuesday January 04, 2011 @12:16PM (#34754694) Homepage

      Yes, that's right. DDR2 is 'over the precipice' - it's old technology at this point.

      We're kind of at a point similar to where we were in the mid-90s, where the "last generation" (high end 486) systems were just as fast/comparably fast to "this generation" (early Pentium) processors, but RAM support (and availability, utility, etc.) was more significant.

      Right now, any system 3-5 years old is likely to be 'good enough' for most peoples' tasks - all except the most demanding users. The bottleneck will be RAM. On the older systems with only 1-4GB of DDR2 support (or present), this is going to start being a problem.

      We ran into the same thing a couple years ago with DDR, and a couple years before that with PC133: smart and/or financially capable people bought as much of the stuff as they conceived they'd need to keep those systems supplied long enough to replace them outright. (In many cases, I know that DDR RAM held those systems out until quite recently.)

      In most cases, systems with DDR2 are nearing their EOL anyway. They're a bit aged, and very few have been produced OEM in the last year or so. DDR is "gone", so to speak; DDR2 will be there in a year or so, at this rate.

      DDR3 is technically superior to DDR2 in almost every way: it's lower power, runs cooler, and is markedly faster. The chipsets which interface with it are better. Forget DDR2 and move on; it's old tech. Use the systems for what they can do and don't fret it - just replace them if you need to.

      • Re: (Score:3, Insightful)

        Right now, any system 3-5 years old is likely to be 'good enough' for most peoples' tasks - [...] On the older systems with only 1-4GB of DDR2 support (or present), this is going to start being a problem

        Aren't you contradicting yourself a bit? Those 3-5 year old computer have 1GB or 2GB RAM already and they are being sufficient. I have a laptop, bought in January 2007, so it's 4 years old. I came with 1GB RAM, it now has 2GB RAM because it was a cheap upgrade. It was a laptop on sale because it couldn'

    • It's almost at the point where it would be more economical to buy a new mobo and ram than it would be to add ram to a not that old board.
      I found this statement rather surprising so I decided to check it out using newegg prices (rounded to the nearest dollar).

      DDR2 1GB: $13 2GB: $29 4GB: $70
      DDR3 1GB: $13 2GB: $22 4GB: $43

      AM3 boards with DDR3 seems to start at $40 while LGA775 boards with DDR3 seem to start at $45 . Of course those are bottom end boards, if you want niceities like more expansion slots or more

  • DRAM began losing value most recently in December as the Western holiday shopping season wound down, Lin said. But major manufacturers such as Elpida Memory, Powerchip Semiconductor and Samsung Electronics kept pumping out chips to stay competitive, he said.

    Really? They actually employed that strategy? "The market is saturated so we need to make more DRAM to raise profits." I don't understand, were they uninformed about demand being satisfied?

    I mean, are they incapable of curbing production for a quarter? I understand these are huge plants that can't be turned on and off with the flip of a switch but if they're not careful they can hurt themselves indefinitely. I'm glad to be getting dirt cheap DDR3 sticks of memory but I don't want to see those companies compete each other into the red over it. I hope they're right when they say it's seasonal because it sounds like they're in for some tough times all the way through March. Farmers will tell you that flooding the market is a surefire way to destroy your competition as well as yourself ... unless of course you're subsidized but that's a whole other rant.

    • Well, you could overproduce and make mere pennies, or you could curb production and run the risk that your competitors overproduce (and earn pennies) while you earn even less. Collusion to raise prices is hard.
    • by alen ( 225700 )

      i've been following the PC market since the 1990's and the days of $50/MB of RAM. this happens every few years. manufacturers ramp up production and prices plummet. then a few months later they go up again, repeat. the complete cycle usually lasts 2-3 years

      you have to keep production running since the plants are built with debt and the interest has to be paid on a regular schedule

      • by xystren ( 522982 )
        Go back a decade further to 1987 and I can tell you stories about paying just under $800/meg for my '286...Good old DIPP. needed to buy sets of 9 chips for a bank, 4 banks of 256k to make a megabyte, at ~$18 a chip. Now I look at the price of ram and never complain when I paid that price back then
        • by alen ( 225700 )

          i remember in a school lab the teacher had the only Mac with a hard drive. 80MB. i thought it was so cool and that it would last a life time

    • Those plants have very hight fixed costs (mainly interest on initial investiment), and very low unitary costs. That's why, even with record low prices it doesn't make sense to reduce production. While they may not recover the initial investment, they'd lose even more money if they don't produce at full capacity.

  • In other news...

    Samsung has announced official sponsorship of the popular video-blog 'Will It Blend?'

  • by PolygamousRanchKid ( 1290638 ) on Tuesday January 04, 2011 @11:01AM (#34753886)

    "I got an action figure!" "I got some DRAM chips!" "I got a rock."

  • Prices of durable consumer goods drop off dramatically directly after the biggest month for sale of durable consumer goods. Film at 11.

  • More history (Score:5, Insightful)

    by Waffle Iron ( 339739 ) on Tuesday January 04, 2011 @11:07AM (#34753952)

    historic highs around $2.80

    You want historic highs? I remember a DRAM crunch in the 1980s when prices spiked at about $1000 per megabyte. (That's about 150,000 times more costly per bit than current prices.)

    Now, get off my lawn.

    • I paid $125 to upgrade my Atari 400 from 8K to 32K.
      • by garyok ( 218493 )
        Meh - the ZX81 16K RAM pack cost £50 in 1982, or $87.53 in Freedom Money. Adjusting for inflation, that's $191 (or $12,224/MB) in today's money.
    • Some of my friends supported themselves during that time by recycling DRAM DIPs from dumpster-diven PCBs. Propane torch the back of the PCB and they drop into a bowl of water, clean the legs with a sucker and/or braid, and then drop them into a homebuilt test rig. They made thousands. A little toxic for my tastes but doing that particular kind of stuff is over now anyway. (Maybe, though, you could bake SMT components off boards in an oven, if any of them were worth anything.)

    • Maybe I wasn't paying attention, but I don't remember being able to buy DDR3 chips for any price in the '80s...
    • Hmm, I can't imagine what 1 Megabyte of magnetic core would have cost...
  • PC makers typically spend about 10 percent, or $20 to $36, of a PC's total manufacturing cost on DRAM.

    So, if you buy a computer for $200-$360, you are basically getting it at cost.
    • That's already known. The profit margin for computers in that range is practically non-existent. Which is why you'll find those low end Dells without the on board temperature monitor or really anything optional. And why if you want to adjust the configuration even with cheaper components it ends up costing double the price.

      I'd be surprised if that didn't apply to most other mass producers of computers as well.
  • Wow, am I ever shopping at the wrong places! :-)

    • Re:$2.80 to $0.84? (Score:5, Informative)

      by jimicus ( 737525 ) on Tuesday January 04, 2011 @11:40AM (#34754250)

      That's probably for the chip, before it's soldered onto a DIMM, before it's even left the factory.

      You'd be amazed how much money needs to be spent to turn it into something you can actually plug into your PC.

    • Still, my jaw hit the floor when, on reading this article, I checked Newegg and found that an 8GB DDR3 kit could be had for less money than what I paid for a 4GB kit at this time last year. I'm almost certainly going to have to jump on that...
      • by eepok ( 545733 )

        That's exactly what I did after reading the article-- ran off to Newegg to check if the manufacturing variable is being directly correlated to sales prices... and it is!

        This is great news for those who bought new computers (or built new systems) over the Holidays and didn't max out the RAM due to the price. I have a couple people who I advised in December about buying full systems that I need to contact now to say, "You know how I said that RAM prices fluctuate significantly with natural disasters, politica

      • by klui ( 457783 )

        It's too bad this drop affects DDR2 and above and not DDR.

I am more bored than you could ever possibly be. Go back to work.