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The fact that a dozen companies are allowed to buy up the entire global supply of core components, and increase the cost of living for every human on Earth, is
by TalkingCodeMonk 3mo ago
The fact that a dozen companies are allowed to buy up the entire global supply of core components, and increase the cost of living for every human on Earth, is full blown dystopian.
- Matl 3mo agoThat's why some regulation is not the enemy of the people that some want to make it out to be. Unfortunately, I think regulatory capture is so deep now in most places, one can hardly expect anyone to do anything about it.
- alex43578 3mo agoWhat’s the proposed regulation that would help here? Price controls? They don’t work, especially in a market like memory.
- Matl 3mo ago> What’s the proposed regulation that would help here? Price controls? They don’t work. The proposed regulation would be that if a single company/industry buying up supply to the point it starts driving significant inflation for such and such goods, they would be severely restricted from doing so going forward.
- Aurornis 3mo agoIt’s a global phenomenon. The latency concerns for data centers are minimal, so they could be built anywhere. If your country restricted a company from buying too much of a product they need, 10 other competitor companies in other countries would be formed the very next day offering to do the work in their country for a minimal fee. This is a global market. Supply and demand isn’t going to be cancelled out by politicians in one country trying to squeeze the market. If you did restrict companies from buying things they need, you would see all future companies in that space incorporated in other countries.
- testing22321 3mo agoThe old race to the bottom.
- JumpCrisscross 3mo agoYeah, imagine doing that for oil. American and EU companies that “hoard” oil get punished. The net effect would be everyone else gets to buy more and prices remain exactly the same.
- win311fwg 3mo agoSo, in practice, if, say, the agriculture industry buys up the supply of seeds (they already effectively do) and we see it start driving significant inflation for food (a common concern), the agriculture industry would be restricted from buying seeds?
- m4rtink 3mo agoNot saying this is the solution, but strategic reserves of important commodities exist. Maybe we need the same now for computer parts, that are now so important for everything in our modern digital society ? So that feverish investor speculation and shady circular financing deals don't cause sudden 30+% inflation on any technological device.
- alex43578 3mo agoGood news, you get the DDR2 that has been languishing in a salt cave for the last 20 years. Reality check: a strategic reserve of modern technology components in volumes needed to impact consumer prices is completely infeasible and illogical. I’d be fine with the idea of the government maintaining supplies of defense industrial inputs, critical minerals, etc; but as we see with our efforts for rare earths (and even petroleum) you can never stockpile consumer supply levels.
- sib 3mo agoA strategic reserve of a commodity that (historically) depreciates at ~50% per year is a terrible trade for occasionally avoiding demand-driven price spikes.
- mghackerlady 3mo agoThe only thing the US could feasibly implement is forcing micron to allocate a certain amount of its production for consumer use
- alex43578 3mo agoWhy? Why is consumer use vs corporate use a higher and better priority meriting such an intrusive regulation?
- angoragoats 3mo agoBecause extreme corporate use, that is, what is happening now where a majority of supply is locked up ahead of time via B2B back-room deals, is anti-consumer. Unregulated, it is easy to see how this could lead to a perpetual "rent everything" dystopian environment for consumers.
- alex43578 3mo agoEvery use of DRAM is a corporate use, with the best consumer-friendly examples like Apple’s efforts to hold down prices (until today) being thanks to “back room deals”. Nobody’s buying some DRAM to build a memory stick in their garage. Apple, Raspberry Pi, Supermicro, and OpenAI all have the same claim to supply you do: you can buy it with money, with the seller being allowed to charge what they want. In fact, high prices are going to be the only way to stimulate supply and encourage the billion dollar investment in additional memory fabs. Price controls or other supply-killing mechanisms are known not to work - it’s Econ 101.
- angoragoats 3mo agoYou ignored the part where I mentioned "extreme" and "locked up." To be fair I wasn't necessarily clear what those meant. I'm specifically referring to the deal(s) that OpenAI signed which reserved an outsized chunk of the memory supply, for what is apparently speculative future hardware that hasn't been built yet, or at least to build hardware that no consumer or business will ever be able to physically purchase. Hopefully you'll agree that there's a difference between even a large buyer like Apple reserving a large chunk of DRAM supply to put in their products that they sell to consumers, and the anti-competitive behavior by OpenAI that I describe above.
- angoragoats 3mo agoBarring any single company from negotiating to buy more than a certain percentage of a given existing market of goods would be a start. Companies would still be free to build their own factories/fabs if they didn't like it. That, and putting Sam Altman in jail for being a lying fraudster.
- Danox 3mo agoOne or two companies will come out of this, designing and engineering memory and partnering with someone else to do the fab of that memory no different than making processor chips in Arizona.
- Danox 3mo agoThe market will take care of itself. The Chinese are going use this to ramp up and build more memory, and some companies out there will take it in-house, In short, they won’t be caught with their pants down again.
- byzantinegene 3mo agoyes, this will give the Chinese a good opportunity to catch up.
- Aurornis 3mo ago> That's why some regulation is not the enemy of the people that some want to make it out to be. The question is always: What specific regulation? Regulation is not the magic silver bullet that some want to make it out to be. You’re not going to solve a global supply and demand change by regulating companies to not buy too many things. The supply would go to other countries. Companies would open international subsidiaries that built the data centers in other countries. Companies would move to other countries which didn’t try to stop them from buying components on the free market. You can’t regulate companies into keeping prices down. This is an international market. If you passed a law that said RAM had to be sold for no more than 30% higher than last year’s price, the international memory companies would laugh and stop sending RAM to that country. > Unfortunately, I think regulatory capture is so deep now in most places, one can hardly expect anyone to do anything about it. I think you need to broaden your understanding of how the DRAM supply chain works and which countries are involved. You can’t mandate low prices for a global commodity. You can try, but the supply will just disappear for that country.
- Matl 3mo agoYes, it's better to not do anything right? After all 'the market' is working for some. No regulation would catch 100% of this, nor is it meant to. But it can definitely deal with companies opening international subsidiaries etc. Sanctions can be worked around too, but that's a hassle and so countries/companies/individuals generally try to avoid them at all costs.
- Aurornis 3mo ago> But it can definitely deal with companies opening international subsidiaries etc. You’re still imagining this as a purely single-country issue. The demand for AI data centers is global. If OpenAI, Anthropic, and xAI weren’t building them, other companies would step in to provide data center services for a fee. Now you have the same buildout, just less efficient and more expensive for the end consumers because we’re paying a new middleman for the compute. The regulation maximalists would argue that we could then forbid companies from buying foreign data center capacity, but then that means other companies would appear in those other countries offering the AI inference service. What you’re missing is that this is a global supply and demand issue and you can’t solve it with domestic regulations.
- slopinthebag 3mo agoWhat evidenced-backed regulation would solve this problem?
- mmcnl 3mo agoThe AI "market" is not a free market. It needs regulation.
- qaq 3mo agoIf people were not consuming their services they would not be buying inference hardware at this rate so it's pretty much on consumers.
- Insanity 3mo agoThey are reserving future HW productions to meet their hypothetical usage as well. Which is why others (like Apple) can’t reserve it for their future products. Yet the AI labs are speculating on usage, and spending money from investments without clear revenue path.
- qaq 3mo agoYes 65B ARR that Anthropic has is clear indication there is no path to revenue.
- groundzeros2015 3mo agoThe cure for high prices is high prices. This increase in demand is encouraging economization. Factories which make components are trying to operate for more hours. Producers who haven’t gotten into RAM may try it out. Large companies like Apple may test alternative suppliers. Consumers who don’t really need an upgrade will wait, allowing others who need it to buy one.
- hackingonempty 3mo agoUnfortunately, RAM is more like a taxi than an umbrella. > Anyone who’s spent any time in New York City knows that when it begins to rain, two things happen immediately: It becomes easier to buy an umbrella and it becomes harder to hail a cab. As soon as the first few drops fall, people appear on the street selling cheap umbrellas, while a lucky few pedestrians occupy all the available cabs. http://shirky.com/2001/01/ http://shirky.com/2001/01/
- groundzeros2015 3mo agoNo? It’s an interchangeable component which is manufactured at scale by many suppliers. Even though the elasticity of supply for taxis is less, rain encourages taxis to get on the road, and work longer to serve the spike in demand. With ride sharing apps the pool of supply is even more elastic.
- hackingonempty 3mo agoBuilding a RAM factory is a major investment and takes a lot of time. There is a big risk that by the time you enter production the rain will have stopped in the form of reduced demand and/or algorithmic improvements that reduce the memory required to produce good results. All of the attention is on the well funded frontier labs who may be buying up RAM as much to starve out competitors as anything else while in the background there is an army of researchers all over the world who only have a handful of consumer GPU to work with.
- 3mo ago
- butlike 3mo agoYeah but if you think about it... you don't really _NEED_ any of this stuff. It's all "want" and not "need" deep down. We don't really need smartphones, we're just led to believe we can't live without them.
- angoragoats 3mo agoI want to believe this is true, but I am increasingly encountering situations IRL where saying "I don't have a smartphone" would be a serious hindrance to doing whatever it is I'm doing.
- butlike 3mo agoWhat helped me come to my conclusion is trying to come up with concrete examples, so like "I need a smartphone cause I need maps going to a place I've never been before" instead of "I need a smartphone for whatever it is I'm doing." Then I can be like: well, the trip sends me to the boonies, so maybe I'll have a printed/offline map as a backup, just in case.
- pseudalopex 3mo agohttps://news.ycombinator.com/item?id=48677854 https://news.ycombinator.com/item?id=48677854
- angoragoats 3mo agoYeah, this is the type of stuff I was referring to, not the map stuff, which can obviously be done without a phone.
- as1mov 3mo agoIt's 2026, the _WANTS_ are reserved for the ultra wealthy. The rest of us plebs should be happy we're getting 1500 calories everyday with a room to go back to in the evening, after increasing shareholder value everyday. Oh and don't forget to reduce your plastic usage to save the planet.