RAM prices have generally gone up over 100% and at one point a few weeks ago
as high as 130% in some cases.  The price increase is a result of a
combination of factors and not only the Taiwan earthquake as prices were
moving rapidly upwards even before that tragedy.

Prices rose partly because of supply as many DRAM manufacturers dropped out
of the market due to the rock-bottom prices in the latter part of 1998 and
first half of this year.  At one point, prices for RAM modules were selling
below cost of manufacture and we enjoyed those low prices.

The memory manufacturers that were left shifted production to larger (128Mb)
and faster DRAM modules (133MHz) which were not subject to so much price
pressure but the shift was far from smooth and supply was affected.  At the
same time, the boom in free PCs in the US market spurred demand for memory.
This coupled with the fact that many PC makers began outfitting entry level
PCs with 64MB because memory was so cheap contributed to the shortage of
memory and prices began to rise.

Because prices were at their historical low, manufacturers did not invest in
new equipment and production processes and are now unable to cope with the
new demand.  They are now scrambling.  The Taiwan earthquake just aggravated
the situation.  Although no memory chip plants were damaged during the
quake, reports show that as much as 10 days production was lost due to
electricity failure, repair and recalibration of equipment.  The focus has
shifted to South Korean and Japanese chip foundries to fill the demand while
Taiwan gets up to speed again.

Interestingly, manufacturers such as Micron in the US, have also increased
their prices in tandem with others even though they have no manufacturing
facilities in Taiwan or anywhere in Asia!!

Expect these high prices to continue until the end of the year.  Those in
the business say that prices are beginning to stabilize and will drop
slightly around end-November but may not be as cheap as it was in the first
half of this year.  We shall see.  But the era of cheap memory is over for
now.

Hope this helps,
Richard


--> Hi everyone !
--> I'm from Vietnam. The price of RAM in Vietnam is increased in
--> over double ( ex. 30USD to 70USD), please show me if the proce
--> in the world is increased too, and why ?
--> Thanks in advance.
--> Nguyen Dinh
-->

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