Rambus Claims It Was Price-Fixing Target 138
conq writes "BusinessWeek reports on the latest developments in the Rambus/Micron saga over pricefixing." From the article: "One e-mail, dated June 5, 2001, from Micron Vice-President Linda Turner to other Micron employees was in response to worries about prices on DDR-DRAM that had been falling. 'No problem!,' Turner wrote. 'We want DDR to explode in the marketplace so have actually been requesting Infineon, Samsung, and Hynix to lower their DDR pricing to help it become a standard (and drive Rambus away completely).'"
Damn, where's the (Score:3, Funny)
Re:Damn, where's the (Score:2, Funny)
Thanks for that! (Score:1)
So, the reason I had to shell out the high prices was because you wanted to not sell me the chips. Me and my wallet thank you.
Re:Thanks for that! (Score:1, Funny)
I have no idea what kind if game Rambus is, but they should get better marketing. I'm not gonna buy it if I don't even know what songs are included, geez.
Re:Thanks for that! (Score:2)
Re:Thanks for that! (Score:1)
Economics ?? (Score:1)
Re:Economics ?? (Score:2)
Re:Economics ?? (Score:2)
A company isn't dead until the lawyers have picked the carcass clean. I'd say "investors" instead of "lawyers", but the investors just get the bones.
Re:Economics ?? (Score:2)
Re:Economics ?? (Score:5, Interesting)
They made the mistake of trying to make a quick buck with their submarine patent, and they ticked off just about everybody. Including some very big players (Infineon, Samsung, Hynix, etc). This is just the big guys' way of exacting a very painful (and much-deserved) revenge. What the big memory makers did (assuming it's all true) may not have been legal, but boy, it sure feels good to see punks like Rambus writhe.
This ain't just business any more. It's personal.
Re:Economics ?? (Score:2)
Re:Economics ?? (Score:2)
- Prices go and stay high
- Consumers lose
- Rambus wins
Other memory makers Way;
- prices dive and rambus croaks
- consumers win (for now)
- all memory makers compete one another as usual after
- maybe consumers win/maybe lose later
Gee. Looks like the choice is a probability of getting screwed vs the certainty of getting screwed for the consumer. I'd take a probability over a certainty any day.
If you really want to bitch about price fixing, how bout you start with Oil Companies and the Bush Cronies R
Re:Economics ?? (Score:1)
I mean, getting "screwed" by two bucks beats "maybe" getting screwed by a hundred, at least to me it does.
Re:Economics ?? (Score:2)
Reading Comprehension ?? (Score:2)
They're claiming that DDR manufacturers colluded to reduce prices, thereby taking a temporary hit in profit while driving Rambus out of business. All in the interest of future profits. Thank Wal*Mart for the idea.
Re:Reading Comprehension ?? (Score:1)
Re:Reading Comprehension ?? (Score:2)
Re:Reading Comprehension ?? (Score:2)
And your point is...? I don't recall it being illegal to sell below your cost. It's probably not the cleverest thing you could do if you don't stop before you run out of cash, but it's legal AFAIK.
For example, nothing prevents me from starting a business selling bread (which I either make or get from suppliers like Wonder, Pepperidge Farm, et al) and selling every loaf for $1. If it costs me $2.50 to buy Pepperidge Farm and $1.50 to buy Wonder, but
Re:Reading Comprehension ?? (Score:1)
What you describe is called dumping and it is illegal in the United States.
Re:Reading Comprehension ?? (Score:2)
While simply selling below cost is not a problem in itself, selling below cost in order to drive out competition is predatory pricing which violates the Sherman Antitrust Act. That's my point.
Whether or not this is true in this case is up to the courts to decide, but it appears that predatory pricing is what Rambus is accusing Micron and the manufacturers of.
Re:Reading Comprehension ?? (Score:2)
Simply selling below cost isn't illegal. Almost all companies do it in order to get people into the store (so that they'll then buy something else).
Pricing enough items so that an entire store is loosing money until the other compaines go out of buisness is the problem.
Re:Reading Comprehension ?? (Score:2)
--jeffk++
Re:Reading Comprehension ?? (Score:2)
IIRC, collusion is when they all set some artificial and generally equal, or close to equal price to establish a artificially inflated price, i.e. to ensure profit by not having someone else to undercut you.
I can understand that there are some similarities, but this looks like them sharing their
Re:Economics ?? (Score:1)
Re:Economics ?? (Score:2)
Let's just say.... (Score:4, Funny)
Re:Let's just say.... (Score:2)
Rambus was overpriced and underperformed. (Score:5, Insightful)
Re:Rambus was overpriced and underperformed. (Score:4, Informative)
In reality, I think the entire fiasco which involved Rambus giving Intel a huge chunk of stock and Intel not producing (for a while) a chipset which worked with normal DDR SDRAM hurt Intel tremendously in the end. There's no way AMD would have gotten a foothold in a market where you didn't have to pay almost double for RAM that was not as good. I know I put off building a new computer for an extra two or three years because I didn't trust AMD quality at the time (probably wrongly) and I didn't want to pay for the huge extra cost of Rambus RAM.
The whole thing seems to me to imply price fixing towards the high direction instead of the low - seeing as at the time Intel had a pretty solid lock on the Windows market. Tom's Hardware gave AMD a great shot at breaking into that, I guess...
I wonder how much they paid for that.
Re:Rambus was overpriced and underperformed. (Score:1, Troll)
Probably nothing. Just because a company's blunder gives a competitor a leg-up doesn't automatically imply the competitor had anything to do with it.
If I recall, Intel was (ineffectively) trying to utilize their monopoly on the processor/motherboard market to "encourage" the Rambus memory standard. They did this because they had a huge financial stake in Rambus. If they had succeeded, I'm sure we would have seen a flurry of lawsuits (ala the Microsoft/Netscape deba
Re:Rambus was overpriced and underperformed. (Score:1)
The article makes a mistake when it mentions t
Or more likely... (Score:5, Informative)
"PC800 RDRAM, which operated at 800 MHz and delivered 1600 MB/s of bandwidth over a 16 bit bus using a 184 pin RIMM form factor"
"Compared to other current standards, Rambus shows significantly increased latency, heat output, manufacturing complexity, and cost.[citation needed] PC800 RDRAM operated with a latency of 45ns, compared to only 7.5ns for PC133 SDRAM."
then squashed by
"DDR SDRAM, introduced in 2000, operated at an effective clockspeed of 266 MHz and delivered 2100 MB/s over a 64-bit bus using a 184 pin DIMM form factor."
not to mention needing CRIMMS or whatever they called the terminators
http://en.wikipedia.org/wiki/RDRAM [wikipedia.org]
http://en.wikipedia.org/wiki/DDR_SDRAM [wikipedia.org]
Re:Or more likely... (Score:4, Insightful)
Even at the price, it was still cheaper to buy RDRAM than a 20% faster CPU for a reasonable RAM config. (Although I'm glad my employer paid for it rather than myself, because those machines are impossible-to-upgrade lead balloons nowdays.)
Hate to be the guy defending RAMBUS, but much of the anti-RAMBUS attitude was driven by Memory Cartel propaganda.
Re:Or more likely... (Score:2)
RAMBUS wasn't really shit -- it had about a 20% advantage in workstation performance over SDRAM -- until DDR came out.
RDRAM is based on the same premise behind USB and SATA: cut the number of bits transmitted and increase the frequency to get higher throughput. This is a method that is proven to work. However, Rambus brought their technology to market before it was mature. They promised a simpler design, fewer errors, higher throughput. What they delivered was a complex mess of overheating chips that did
Re:Or more likely... (Score:2)
Amen to that. I have a few older but still decent PC's at work that are essentially stuck at 1 gig because upgrading them to 2 gigs of RDRAM would cost more than a new PC.
Re:Or more likely... (Score:2)
PC2-3200: DDR2-SDRAM memory stick specified to run at 100MHz internall, 200 MHz externally using DDR2-400 chips, 3.200 GB/s bandwidth
Where's the problem? (Score:4, Funny)
Re:Where's the problem? (Score:3, Informative)
Re:Where's the problem? (Score:2)
Re:Where's the problem? (Score:2)
That may be the funniest thing I've ever heard.
Re:Where's the problem? (Score:3, Informative)
Re:Where's the problem? (Score:2)
Re:Where's the problem? (Score:2)
Re:Where's the problem? (Score:1)
The reason this sort of price fixing is illegal is because what originally happened was businesses would lower prices to drive out the competition while taking a big loss. Once the competition was gone, they would artificially inflate their prices to gain a huge profit and there would be no competition to stop them.
Re:Where's the problem? (Score:2)
It was illegal for Microsoft. They dropped web browser prices artificially low by bundling. Even though it meant the end user got a free web browser, it was an anti-competitive practice meant to put other software makers out of business.
Re:Where's the problem? (Score:2)
No Navigator was free in the beginning to capture marketshare, then version 3.0 cost $49 (how else would they make money?), then was free in 1998 after it lost the browser war.
Those who can, do, those who can't, sue... (Score:5, Insightful)
If your product does not hit the market as it should, sue someone. Sue "Linux", to save your outdated product, sue your competitor for some meaningless patent hassle or, and here's the actually as far as I can judge ONLY new bit in this, some cartel building.
What happened to good ol' free commerce, where the best product makes the buck? Been coffined and buried by lawyers and marketeers long ago, I know...
Re:Those who can, do, those who can't, sue... (Score:2)
Whatever happened to collusion not being part of good ol' free commerce?
This lawsuit is based on the concept that free commerce (and therefore competition) was not allowed to happen because of collusion. Reagrdless of whether Rambus was terrible or not, there is merit in these types of lawsuits.
It's very simple: Unregulated commerce != free commerce. It's "free" as in free of non-competitive influences, not as in free
Rambus is the Eolas of Hardware (Score:2)
Re:Rambus is the Eolas of Hardware (Score:1)
Rambus are NOT the good guys by any means. Much of their technology is items that they patented based off of collaborative industry works from trade conferences.
Essentially "Hey intel/micron/samsung lets talk about new volatile memory methodologies. Ok thanks for coming... runs to file patents"
Rambus are not semiconductor manufacturers, they are patent litigators and their patents are largely nonsense.
Re:Rambus is the Eolas of Hardware (Score:2)
Here's a link for the benefit of your fellow ignormaouses who might want to educate themselves.
http://www.theinquirer.net/?article=27993 [theinquirer.net]
And yes this is a flame. It's ridiclous how easy it is for companies to manipulate and use computer nerds. Just feed th
Re:Rambus is the Eolas of Hardware (Score:2)
--jeffk++
Re:Rambus is the Eolas of Hardware (Score:2)
Re:Rambus is the Eolas of Hardware (Score:2)
Yes, RAMBUS makes a lot of money from their patents, but so does every other company in that business.
Re:Rambus is the Eolas of Hardware (Score:2)
Wait... (Score:2, Interesting)
Collusion Not Always An Antirust Violation (Score:4, Interesting)
If RAMBUS wants to push this one, they have to reveal something beyond Micron et al attempting to lower prices for consumers across the board. If they could prove that their alternative had the same cost basis and Micron et all lowered prices solely to drive them out of business so they could all then simultaneously raise prices back up, and in fact did so, then they would have something, but it doesn't not sound like they had a cheaper solution or that Micron et al were losing money to drive them out of business to raise prices back up. Collusion is not illegal if it works in favor of consumers. I think a lot of people fail to realize that antirust laws and the like exist to protect consumers, not protect businesses from competition (which is why a government entity is the one who generally prosecutes antitrust cases "for the people").
AntiTrust (Score:2)
Re:Collusion Not Always An Antirust Violation (Score:2)
The laws to protect businesses from competition can instead be found under the heading 'intellectual property laws'.
Personally, I dont think I knew any self respecting geek those days who'd be caught dead buying Rambus RAM. Their name was shit from the day their patent troll behaviour hit the news.
Re:Collusion Not Always An Antirust Violation (Score:4, Informative)
Dude, the government did procecute them, and the RAM companies have already admitted guilt in price-fixing. This story is filled with very ignorant commenters.
http://arstechnica.com/news.ars/post/20051013-542
http://arstechnica.com/news.ars/post/20040915-418
Re:Collusion Not Always An Antirust Violation (Score:2)
Sure, but not in this particular instance. Please look up "Commutation of Conditionals" or the "Fallacy of the Consequent" for why your argument has run off track. You are stating that the companies have been found guilty of price fixing in some instances, therefore they are guilty of price fixing in this instance, which does not logically hold.
Re:Collusion Not Always An Antirust Violation (Score:2)
I think this is generally true. But you have to remember that the assumption is that reducing competition (by, for instance, driving a competitor out of business to create a monopoly or de facto monopoly in th
Price fixing...technically? (Score:4, Insightful)
Re:Price fixing...technically? (Score:2)
An indirect analogy comes to mind.. such as when a large retailer prices at a loss to force out other competition, then brings prices inline with the rest of the chain. How is this different than a large group got together, lowered prices, and forced the competition out?
Re:Price fixing...technically? (Score:1)
Re:Price fixing...technically? (Score:5, Informative)
Re:Price fixing...technically? (Score:1)
Re:Price fixing...technically? (Score:2)
Re:Price fixing...technically? (Score:3, Informative)
First - what they are claiming isn't price fixing, it is predatory pricing. And this isn't what Standard Oil did. Standard oil bought out competitors, their lower prices were the effect of huge economies of scale - NOT predatory pricing. There are dozens of books on this.
Second - predatory pricing is a myth. The conditions requisite for predatory pricing to work are so stringent it is silly to beleive it exists in an
Re:Price fixing...technically? (Score:2)
In the instance of VOIP in Canada the regulatory board CRTC made manditory pricing schemes because of companies like Bell Canada would be able to offer the service at such low price (introductory of course) as well as brand recodnition they would be able wipe out customers relation with other providers then adjust prices accordingly.
Now keeping in mind VOIP is a service and not a physical product so these events are not completely parallel but in terms of "preditory pricing" being laughable
Re:Price fixing...technically? (Score:2)
Re:Economist's Opinion (Score:2)
Re:Price fixing...technically? (Score:1)
This is uncompetitive behavior = illegal (Score:1)
QFT (Score:1)
Re:Price fixing...technically? (Score:2)
Re:Price fixing...technically? (Score:2)
Case 1: Goal is to serve customers better. Competitor goes out of business as all their customers prefer you. Example: Linus Torvalds, saying "Really, I'm not out to destroy Microsoft. That will just be a completely unintentional side effect. " Later competitors see a chance to try the same thing on you and take your place.
Case 1 is competitive hehavior.
Case 2: Goal is to "cut off their air supply". Competitor goes out of business regardless of customer preference becaus
Nonsense (Score:2)
Re:Nonsense (Score:2)
Probably. That's what game theory would predict. And that's what they should have done, it would have been legal.
Micron informing its competitors of the reason for the price cut is merely a courtesy.
Nope. It's a very important and damning point. That direct information sharing is the definition of overt collusion, and it's illegal. They should have been smarter and just hinted at it in a press release or stock
so uhh.. (Score:1)
The opposite shouldn't be called price fixing... more like... competition?
Hell, if this is price fixing, what the hell is going on with gas then? I'd much rather have them all colude and lower the price.
Re:so uhh.. (Score:2)
Re:so uhh.. (Score:1)
Take a dartboard and see what number a dart lands on?
Or do you look at the market and decide what's a good price for anything you're trying to sell?
So it somehow makes it different if you call up the other company and ask them what price they're selling at?
Truth of the matter is, DDR memory companies had competition with RamBus. If they talked to one another and decided to sell for a low price, how is that price fixing? Are you saying that no competition took place bet
Re:so uhh.. (Score:2)
1: I'll let you think about that for a second. OK, time's up. The DDR companies all agreed on pricing structures, this is collusion. If they all agree to sell at the same price, regardless of their own profit margins and manufacturing costs, that is most assuredly price fixing. They are FIXING the PRICE of their product.
2: Correct. They
Re:so uhh.. (Score:2)
As others have said price-fixing is collusion, that is *any overt communication regarding market conditions*.
Look up Standard Oil.
Really? (Score:1)
Re:Really? (Score:1)
Do you think there are no alternatives to gasoline prices? There are lots of alternatives, they're just more expensive currently. I saw a proposal to grow trees into biofuel once somewhere, the problem was that it would be as expensive as oil priced at 80$ a barrel.
Then again, why do you think oil was priced low in the past? OPEC has said many times that they don't like to see oil priced higher than 40$
Humor me... (Score:1)
Re:Humor me... (Score:1)
The difference is when they raise prices after the competition has been knocked out. If they don't raise the prices when they eliminated the competition, there is no real price fixing going on.
Re:Humor me... (Score:2)
If Billy Ray's Gas shack is trying to charge a 6% commission on all of big oil's sales, then you might have a comparison.
DDR (Score:1, Funny)
I remember... (Score:2)
I actually remember people being dissapointed that P4 "requires" (this is how it was marketed) Rambus memory to show its full potential, and pretty much avoided Rambus like the plague for its proprietary nature and the hefty price.
And of course in time Rambus lost its speed advantage as well, which drove it into non-existence.
Makes me wonder if the addit
Collusion and rights (Score:5, Interesting)
Now correlate that with the introduction and failure of RDRAM in the market and you'll see that PC100 prices dropped not long after it was introduced, and then fast, expensive DDR SDRAM came to market around the time RDRAM became irrelevant. Of course, that's just circumstancial. A lot of different market forces could have caused that kind of price movement.
RDRAM had a lot of technical problems with it. It did run hot, it did ride on funky slots, it was complex to manufacture, and for a variety of reasons, it cost a lot of money, not least because Rambus wanted to recoup the costs of developing the one advantage that RDRAM actually did have. That one advantage was that RDRAM was as fast as Intel's top-shelf CPUs. You could build a PC with a 400 Mhz Pentium II, a 400 Mhz FSB, a 400 Mhz north bridge, and a 400 Mhz memory bus leading straight into 400 Mhz memory, but only if that memory was RDRAM. Of course, 200 or 266 Mhz would have been just fine for most applications and even for most benchmarks. Matching speed with the CPU was overkill and Tom's Hardware knew it, among others.
The things that made RDRAM faster than contemporaneous commodity RAM were the patented designs of Rambus. Their problem was that they came to market seeking tech journo headlines at a time when the average PC consumer was fixated on the CPU speed, assuming that if they could match CPU speed with their RAM and get it written up, people would 1) stop fixating on CPU speed and 2) notice that commodity RAM wasn't cutting the mustard anymore.... and they overdid it, and overdoing it cost more than it needed to all the way down to retail.
Having said that, the evidence is only now coming to light that RDRAM wasn't killed by its own problems. It was killed by commodity RAM manufacturers flooding the market with cheap PC100 and PC133 RAM. So cheap that the cost curve of settling on the faster RDRAM part didn't make economic sense for most system integrators or their customers, despite the technical advantage. So RDRAM dies a quiet death of irrelevance around roughly 2002. Boo-hoo.
What happened next is the part that Rambus is currently seeking redress for. DDR SDRAM came to market, and we all know how it works and why it's exactly twice as fast as conventional SDRAM. What most people don't seem to understand is that RDRAM was DDR. That 400 Mhz RDRAM part actually used a 200 Mhz clock, and the FSB, north bridge, and memory bus of an RDRAM-capable motherboard were also DDR. Rambus developed DDR and holds the patent on it, among other things that have shown up in modern commodity RAM.
So let's recap. Rambus came to market with a problematic yet superior product which was ahead of its time in a market dominated by a few large manufacturers of commodity parts. The major manufacturers got in touch with each other to temporarily fix prices far too low to justify adoption of the problematic yet superior product which was ahead of its time. RDRAM became irrelevant, and the major manufacturers believed that Rambus had also become irrelevant. Once that happened they started using Rambus technology in their own products as the market needed it, while colluding to bump prices back up where they wanted them all along.
Since then, the post-RDRAM high price fixing has been proven in court. Rambus has kissed and made up with Infineon and Elpida with patent licenses and settl
Re:Collusion and rights (Score:4, Informative)
Correct - sort of. There was a temporary glut of RAM as fabs came online and started churning like made, but when a third of them went offline simultaneously (fire? earthquake? I forget) prices spiked immediately. There weren't any more parts in the pipeline to feed those empty sockets that people just learned how to fill.
RDRAM had a lot of technical problems with it.
Chief among them was that its performance sucked, and sucked hard. It was very good at streaming a huge contiguous block to the processor, but beyond horrible at switching to another block. Imagine a CPU that was excellent at applying a single operation to a large chunk of memory but awful at everything else. Voila! You've invented P4+RDRAM!
I can imagine applications where it would've rocked, like encoding video using an instruction block small enough to fit entirely in cache so that the only memory fetches were to the input data. You definitely wouldn't have wanted to run a busy multipurpose server off it, though.
Rambus developed DDR and holds the patent on it, among other things that have shown up in modern commodity RAM.
That's also partially true, and the reason that everyone in the know hates Rambus. They took part in the DDR development process, but lied to JEDEC by "forgetting" to mention that the methods they were proposing as part of that process were already patented - by them. Had they mentioned that minor fact, modern DDR would've had a different design, but one that was less convenient for Rambus's patent portfolio.
Re:Collusion and rights (Score:2)
Uh, these are standard parts. Commodities. If they sold DRAM at a higher price, the would sell none at all. No one has mentioned "inflated profit margin" in regards to DRAM since the mid-90s. The DRAM business is brutal with low margins.
screw 'em, rambus is pure evil (Score:3)
anything that hurts rambus is OK in my book. you look up "screaming weasel" in the dictionary, you see their logo.
give those DDR guys a medal for a common spec, lower prices, and better performance. I will never own a rambus-loaded computer. it is the one thing I specifically check for.
The other piece of the puzzle... (Score:2)
RDRAM could have been within 10-15% of SDRAM on terms of costs.
That said, I see this as a mistake on the business and PR side, not one of the technical side. At some point, Rambus has to look at itself in the mirror and figure out what it
Rambus in Playstation 3 (Score:2)
Strange case... (Score:2)
Everyone here, older than 13, should remember that Rambus was overpriced, overhyped, and under-performing. The only break that they got was that Intel decided to use only RDRAM on their motherboards, and support only RDRAM with their chipsets.
The writing was on the wall. It just looks like the other companies got a little worried that it might catch-on, and instead of each companies independantly lowerin
Re:And this is news... why? (Score:2)
would it be cheaper just to replace some of them and use the ram from those you scrap to upgrade the others?
how much does a new motherboard/CPU of comparable performance cost nowadays anyway?