Memory-maker Micron has found a way to keep prices for its products sky-high for another five years, by signing 16 “strategic customer agreements” (SCAs) that include a floor price the company says comes with “a very robust gross margin for Micron, well above our peak quarterly margins in any past cycle.”
Micron CEO, president and chairman Sanjay Mehrotra explained the SCAs in prepared remarks delivered during the company’s Q3 earnings call. He explained that Micron has signed 16 SCAs, most of them covering 2026 to 2030, and that they involve a commitment to buy a certain quantity of product and pay for it in a pricing band that has a floor and a ceiling price. The floor price covers the historically high gross margins mentioned above, and the ceiling price means those who commit to an SCA are insulated if memory prices go even higher.
They make whatever is most profitable as individual companies.
And China as a government, absolutely loves the idea of everyone’s computer usage going thru giant corporations because the Chinese government owns part of every Chinese company and doesn’t need a backdoor since they have a set of keys.
Like, why would they make something that they don’t want and would sell for less profit margin overseas?
Why build for a bunch of broke consumers when there’s a blank check for anything related to data centers right now?
That demand could disappear tomorrow. Personal computers will just get more expensive so prices will keep going up for when they have to switch back.
Why would you ever hope China would save us from this?
Edit:
It seems like people are confused here:
Reason 1 they want to make data center stuff, is just money:
Separate reason #2 to prefer data center stuff as a product, is everything in China goes thru Chinese companies which China controls.
If Chinese consumers have to offload their data processing to large corporations, then since China owns a piece of every corporations, they now see everything people process.
Which is why the next sentence references two reason the Chinese government would want to squash home computing in favor of “cloud computing” thru data centers:
This is your brain on American Government propaganda.
To steal market share and relevance from Taiwan, removing the incentive for the US to continue to support its continual war against China.
Because data centers are temporary. Consumers will outlast AI.
Because they’re the only government attempting to do anything for the common person. Yes, they’re China first, but their official stance is to encourage global revolution.
If the Chinese government is doing this to spread hardware backdoors in all the RAM (technically quite difficult to do without detection, btw, and people will be looking) then it will be in their interests to lower the price of Chinese RAM to well below Western RAM, so the world buys as much as possible.
I think it’s more likely to be similar to their photovoltaic cell, battery, and industry policy in general: economically dominate the world’s markets and give China all the advantages that the previous industrial centres of the world had.
The ability to deprive rival nations of valuable resources, or help allied nations by guaranteeing their supply, is incredibly useful, which is why most nations do so if they are able to.
The US gets backdoors in many electronic systems by simply asking, and in some cases creating laws to do so. Why would China not do the same instead of owning shares in the companies? It’s probably more that they want the Party to financially share in the wealth created by those companies, as well as more directly control their corporate actions.
Chinese companies are very competitive, especially between each other. If there is a way to take market share, they will do it. If they make too much profit their CEO risks being disappeared by the chinese government.
Just look at the crazy low solar panel prices which mostly come from china.
Market share is meaningless when the same infrastructure can be used to crank out a slightly different product with an insane profit margin.
There is no logical reason for Chinese corporations to produce consumer RAM for less profit than what datacenters use.
If RAM prices rise to where profit margin is comparable, they’ll make consumer RAM.
Which is literally why RAM.prices are astronomical right now…
Does none of this make sense to you?
They would also sell datacenter RAM for lower prices to get market share there. Of course they would still make a good profit, but they wouldn’t be able to sell at the same prices as established manufacturers anyway since they first have to prove themselves.
Because who would buy RAM by an unknown manufacturer if you could get it at the same price from a known manufacturer?
Bur we’ll see what happens first, the AI bubble popping or chinese manufacturers producing RAM. Both will help lower the price.
And there is actually a reason to sell consumer RAM, if they establish themselves as a good brand to buy RAM from they can get some loyal customers which might buy from them again, whereas there is no real long term loyalty or reliability in datacenter RAM. If the AI bubble pops they will stop buying it.
How the hell does one hide and then use a backdoor in ram?
But did you think about China Bad™?
You add a piece of code that scans for a specific very big prime number and if it finds that, you look for any process and inject into stdlibc any backdoor of your choice
You add a piece of code (to ram, which famously does not hold information while unpowered).
Which scans for a specific very big prime number (finding large primes quickly would completely invalidate the world’s cryptography and therefore banking, that’s why people are afraid of the quantum boogeyman).
You look for any process and inject into stdlibc any backdoor of your choice (just any process, doesn’t need elevated permissions, assuming they use libc, assuming the backdoor hasn’t been patched out from the other end, defeated by any of the dozens of software integrity checks that have become standard).
deleted by creator
could have a chip that looks for a certain sequence of bytes then changes some other bytes as a result… it would probably introduce massive latency though…
Hang on, I’m gonna add a suspicious new component onto a part that is incredibly expensive and heavily scrutinized specifically for speed and latency that will bit bash the I/o.
The gap is in consumer market not enterprise. Micron even focused entirely on enterprise customers. New or small chinese companies can’t compete with that but can enter the consumer market with smaller prices, since no one seems to care for this gap because of higher revenue in enterprise market (just like you said). Why smaller prices? Otherwise why bothering with them instead of known brands.
They aren’t going to “save us” because they’re good people. It’s a company like the others but must get in the global maket in someway and this is a good way.
Buddy…
If they can make 5 million selling consumer of 500 million selling to data centers…
They’re going all in on data center.
Yes but you don’t simply sell to datacenters. Who build them must buy from you. But who the hell know you? That’s the point.
What?
Legitimately, what are you even trying to convey here?
Edit:
Do you mind sharing what country you’re from?
Because it seems like everyone in here saying China will but anything over profits is people either from China or an instance that constantly defends China…
I would prefer not to dox myself, but I’m from Europe.
What I’m trying to say here is that more competition in a so oligopolistic market would helps bring prices down. I’m not licking China boots here, it could have been even the brits I don’t care.
No one is saying that’s wrong.
I’m saying that those companies wouldn’t stop making something with a $1k profit per unit to make something with a $100 profit per unit product.
Consumers will never be willing/able to pay the prices datacenters will pay.
For companies to start switching back to consumer ram. Either the AI bubble needs to burst so demand goes away, or consumers have to be desperate enough to see our prices keep skyrocketing.
They may even know the bubble will burst, at least understand that they won’t keep being built at this rate. But it costs money to switch, there is zero reason to switch before that math changes, because it’s a relatively quick and easy switch.
Like…
What aren’t people understanding here?
Look, I’m no one. So here’s someone:
Since they have no enterprice contractors they must still get known. The point is they can’t just prentend to be bigs and sell to datacenters. They are still catching up. This results in trying to enter FIRSTLY the consumer market (which doesn’t mean deadly low prices). After that of course datacenters will start buy from them, but from now (as far as I know) only Corsair started buying from them.
If you got more questions, please refer to internet.
I don’t have questions, but you should read your own link…
What’s preventing them.from Data center contracts is they lack the scalability…
If they develop the scalability to make a dent in consumer RAM, they now have the ability to get datacenter contracts.
The only question is if they’ll pay to build up that missing architecture, or if a data center contract will come with the build out costs included.
You’re looking at an apple falling out of a tree and expecting it to blast straight thru to the other side of the planet.
You don’t understand any of this, but weirdly think you’re helping people…
We are still taking about NAND chips. Can you backdoor those? I would think you need to backdoor the controllers or smth at least.
Ok .ml, you all are known for your unbiased China takes after all…
Ram would be a really hard component to supply chain attack. It doesn’t store anything when powered off, so you’d need another chip on the board that can store your attack and that’d stick out like a sore thumb.
It also requires incredibly low latency, so low that trace lengths need to be optimized in order to deliver data accurately. So stream manipulation is out the window.
You’re left with searching through the contents looking for something juicy and that requires some kind of extra sore thumb chip that can’t go fast because it doesn’t have a heatsink.
Plus it’s been standard practice to harden the memory of libraries and programs and even operating systems to avoid stuff like the old Intel hyper threading attacks for at least fifteen years now, so there’s a reduced attack surface.
No one’s supply chain attacking your ram.
That doesn’t have anything to do with anything anyone was talking about, except that .ml accounts reflexively defend China…
And no one ever needs more of those examples.
My intent was to provide an explanation for why someone might consider your reply about Chinese manufactured ram being a supply chain risk to be inaccurate.
To be 100% clear as a bell: ram is not a supply chain vector people need to be worried about.
Hey I recommend learning about how the different parts of a computer work what supply chain attacks are and are not realistic before potentially misinforming others. Your concerns are unfounded
Ok .ml, because surely there’s no other reason you’d disagree about China…
I’m .ml because it’s the only large instance that doesn’t require an email for sign up, and it’s primarily for tech enthusiasts and professionals.
At risk of sounding like a meme, ad hominem isn’t a great argument. I don’t want any backdoors on any of my devices and, while it’s unavoidable, it isn’t helpful to just make stuff up instead of understanding.
because other governments wont. other governments have embraced comoanies buying eachother up so there is no competition. the enemy of my enemy is my friend