Thread

1. N_Lens · 1789618282 · focus · HN ↗

   The big companies are insulated because they've locked in multi-year supply contracts with ram manufacturers - Microsoft, Google, Meta, Amazon (All on 3-5 yr contracts). OAI's deal with Samsung & SK Hynix is also colossal - locking up roughly 900,000 DRAM wafers per month, roughly 40% of world output (Stargate project).

   Apple got caught out because it had a shorter contract that ended in the beginning of Q3, and they've tried to source their RAM from Chinese CXMT who declined because all capacity was already locked in contracts. They've gone with a lesser known company Kioxia.

   Overall the consumer segment is completely neglected, companies don't care about end users in the current market conditions.

   1. georgemcbay · 1789619698 · focus · HN ↗

      > Overall the consumer segment is completely neglected, companies don't care about end users in the current market conditions.

      Mirroring trends throughout the entire economy (not just RAM and other inputs for AI).

      Everyone is chasing the top 10% or higher of the K-shaped economy for all goods and services, servicing everyone else isn't seen as being worth the investment.

      This will just keep getting worse and worse everywhere for everything as long as we allow income inequality to keep exploding, which seems to be the plan.

      1. azan_ · 1789620448 · focus · HN ↗

         And how do you think it will work? Do you really believe that once competition to serve top 10% get really fierce, no company will try to capture the remaining 90%?

         1. georgemcbay · 1789620903 · focus · HN ↗

            > Do you really believe that once competition to serve top 10% get really fierce, no company will try to capture the remaining 90%?

            They'd try it if we weren't living in an age of persistent supply chain problems across every industry. But sadly we have lived in that world since 2020.

            Good luck trying to capture the low-end of any market when you are competing with those serving the high-end for whatever your inputs are.

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