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.
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).
I wonder if they'll, at some point, have enough RAM? Or is this is the new normal? Will models keep scaling with the amount of ram chips openai and anthropic own?
Even with efficiency breakthroughs, it would just afford packing more agents per unit of memory. Scaling compute and data keeps paying off, leading to smarter models, and smarter models have more demand even at higher prices because they can accomplish more work at higher quality. Sovereign AI hasn’t even really taken off yet to anywhere near the level it could. That’s going to dramatically increase the number of massive-scale users of AI agents. So no, IMHO they will “never” have “enough.”
At some point though, won't someone be able to extrapolate the demand growth curve, and invest some colossal amount of money into making and selling more RAM chips?
Hard to know, does each GB of ram give some marginal increase in profit or potential profit?
I’d guess no. Past a certain point the model has all the capabilities it can possibly usefully offer and honestly we may already be past that. The next gen model just doesn’t seem like as clear a step up as it once was.
and they've tried to source their RAM from Chinese CXMT who declined because all capacity was already locked in contracts.
The US Government also wouldn't let Apple use Chinese RAM anyways, even for product that was just going to be used in China. China does have capacity issues though, and focusing on local brands first is probably the right call. Hopefully they can ramp even if they can't get the fancy lithography machines from the Netherlands.
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.
I wonder how this plays out with automotive? Seems like it could get messy, especially if automotive rated parts are decided to not be worth the premium.
"companies don't care about end users in the current market conditions."
Because the end users keep rushing to use the megacorps' latest AI models, weaving them into their work and life. So the megacorps keep locking in contracts to build more compute.
If you use LLMs, you're responsible for this, there's no way to pass the buck. "I only use it as a companion for learning about history" - it's still your fault. "I only use it to help guide my solitions, not for vibecoding" - it's still your fault.
If you want an industry to act in a certain way you legislate for it, not wag fingers at consumers buying things. "If you want cheaper consumer devices we all need to individually stop using AI" is not useful or realistic.
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%?
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.
China's pretty good at bending the curve. I expect that by the end of 2027 we'll see a lot more available for consumers. As others have pointed out, this might not be available in US markets.
"CXMT currently has two 12-inch DRAM fabrication plants — or fabs - in Hefei and one in Beijing, with a combined capacity of about 300,000 wafers per month.
With the new Shanghai facility and other new capacity, CXMT will double its DRAM wafer output to approximately 600,000 wafers per month, all three sources added."
If I'm not mistaken I believe that CXMT's fabrication process is not suitable for manufacturing within the super tight tolerances that are needed for data center HBM, but I may be mis remembering. I think I recall a chart from somewhere showing that frontier memory manufacturers could achieve something like double the memory throughput for example.
Overall the consumer segment is completely neglected, companies don't care about end users in the current market conditions.
It's almost like these companies WANT a dystopia with a centralized winner-takes-all power structure. Anything in the name of profits, who gives a fuck about humanity and distribution of rights or freedoms.
Well, you know what they say. The best time to blow tens of billions you might never get back on a risky memory fab in your home country is ten years ago. The second best time is today!
On the bright side, this will further accelerate the retro computing scene as people throw their hands up at the thought of building something shiny and new
That's the neat part: it won't until some kind of market dominance is established and maximally exploited by the biggest players. Like during the pandemic when the biggest companies got bailed out while smaller businesses got crushed, permanently shifting the power balance. It's almost as if by collusion.
I think it's time we start talking about putting limits on how much compute AI companies can purchase or own, relative to the rest of the world. It's not fair that they can use trillions of dollars of investor billionaires money to consume all of the resources that everybody needs. Where is fair distribution? What about all of the industries they're destroying in the process by hoarding it all for themselves?
Otherwise, there will be no end to this. There are no hard limits on the speed of a parallel bruteforce. It's an infinite complexity problem class. The more parallel bruteforce power you have, the more likely you are to be able to solve a problem. So there is no world where demand ends. So if something isn't done about this, we'll have million dollar GPUs and RAM sticks because they've priced everyone out of the market and are the only ones able to afford them. Say goodbye to owning your own hardware at that point.
I think it's time we start talking about putting limits on how much compute AI companies can purchase or own, relative to the rest of the world. It's not fair that they can use trillions of dollars of investor billionaires money to consume all of the resources that everybody needs.
Right now, the RAM market is effectively cornered. Anti-trust enforcement is what I'd look to, but the GOP do not believe in ensuring competitive markets / enforcement. (The current admin is pretty clearly 110% pro corporation.) Vote in November, but in all likelihood, there won't be government intervention earlier than 2028, and even that is optimistic. One hopes the AI bubble pops, but I think this market can remain irrational for far longer than I can keep old hardware alive.
I called this almost a year ago that the way things are going that home users and pc enthusiasts will be priced out of computing. And the best thing for the rest of the world is China reaching on parity on node side and crash the market. What would be the prices today if Chinese companies were not forced to build their own chips.
we're driving consumer prices up and delaying the climate transition for Rube Goldberg slop machines. In case any future historiographer decides to go with the title "the age of intelligence, our stupidest period yet" I'd like some royalties
Pretty soon we'll see a renaissance in the tech that we gave up years ago or can still be improved
- memory compression algorithms
- alternative LLM architectures that don't rely on memory or GPUs
- compatibility hardware (like DDR3 to DDR4 boards)
- distributed computing improvements, both at local GPU and networking levels (SLI for AI)
- GPU hacks to add more memory or support older architectures
I'm personally looking forward to the new LLM architectures that don't require as much compute, e.g. DLLMs, which can be good enough for CPU usage but lack the accuracy of frontier models currently.
When this happens the bottom will fall out of the GPU and memory markets, putting a glut of cheap hardware out there.
Doom mongering like this never seems to include these as viable future alternatives, which is standard market adjustments, I wonder who the doom narrative helps? :)
DRAM pricing has historically been cyclical in nature, and the only reason for the current high DRAM pricing is that current AI inference is unnecessarily RAM intensive/inefficient.
Interesting effect is that since DRAM production tooling has been switched from DDR/GDDR to HBM, we may finally see the proliferation of HBM in consumer GPUs/accelerators after the bust cycle starts.
the only reason ... is that current AI inference is unnecessarily RAM intensive
There's no indication that this will change, and every indication this will continue to grow. This is not some temporary thing. Demand is already exponentially higher than what is possible to produce, and there's no current reason to believe it has any ceiling.
I've actually done some work and was able to get the full 12GB Z-image Turbo to run on my 8Gb 3070, and throughout the generation only 600MB of VRAM was allocated (you can get a speed-up by double buffering, but the maximum VRAM was still only ~1GB through inference). It's very experimental and pretty much requires you to write all the compute kernels directly specifically against that particular weight and statically allocate the memory at compile time instead of using current ML frameworks like Pytorch/JAX, but I think in time somebody else would figure it out.
I fear that, whenever consumer-facing supply finally starts to return, the opportunity cost will be priced in. Consumer RAM may end up being nearly as pricey as HBM for a while, and I don't see any reason why it would ever go back down on it's own, unless there are entirely new fab processes that don't meaningfully overlap HBM.
This article is certainly a bit light on details. I'd prefer some more fine-grained and thorough analysis when it comes to this. Like, honestly, I'd have learned more by just asking Claude.
This assumes the current demand will continue. Which is unlikely given the order of magnitude difference between capex by the Big Folks and the revenue generated by that capex. Given they now need to fund this spend from money markets, they are likely to be told off pretty soon. Feds go “ooh” and Google goes “aah”.
What kind of article is that? No explanation, no thoughts, just an empty "trust me bro" prediction from a website that usually publishes consumer hardware reviews.
And the article doesn't even appear in their homepage.
And the author is somebody from a company that "provides you with quality RAM"
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.
I wonder if they'll, at some point, have enough RAM? Or is this is the new normal? Will models keep scaling with the amount of ram chips openai and anthropic own?
Even with efficiency breakthroughs, it would just afford packing more agents per unit of memory. Scaling compute and data keeps paying off, leading to smarter models, and smarter models have more demand even at higher prices because they can accomplish more work at higher quality. Sovereign AI hasn’t even really taken off yet to anywhere near the level it could. That’s going to dramatically increase the number of massive-scale users of AI agents. So no, IMHO they will “never” have “enough.”
At some point though, won't someone be able to extrapolate the demand growth curve, and invest some colossal amount of money into making and selling more RAM chips?
Yes. China's done just that. Expect those factories to come online within 2-3 years.
Hard to know, does each GB of ram give some marginal increase in profit or potential profit?
I’d guess no. Past a certain point the model has all the capabilities it can possibly usefully offer and honestly we may already be past that. The next gen model just doesn’t seem like as clear a step up as it once was.
The US Government also wouldn't let Apple use Chinese RAM anyways, even for product that was just going to be used in China. China does have capacity issues though, and focusing on local brands first is probably the right call. Hopefully they can ramp even if they can't get the fancy lithography machines from the Netherlands.
Formerly known as Toshiba's memory division. They spun off the business as Kioxia in 2017.
Kioxia is Toshiba, The most known company from the list, and it doesnt make any ram
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.
I wonder how this plays out with automotive? Seems like it could get messy, especially if automotive rated parts are decided to not be worth the premium.
"companies don't care about end users in the current market conditions."
Because the end users keep rushing to use the megacorps' latest AI models, weaving them into their work and life. So the megacorps keep locking in contracts to build more compute.
If you use LLMs, you're responsible for this, there's no way to pass the buck. "I only use it as a companion for learning about history" - it's still your fault. "I only use it to help guide my solitions, not for vibecoding" - it's still your fault.
If you want an industry to act in a certain way you legislate for it, not wag fingers at consumers buying things. "If you want cheaper consumer devices we all need to individually stop using AI" is not useful or realistic.
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%?
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.
China's pretty good at bending the curve. I expect that by the end of 2027 we'll see a lot more available for consumers. As others have pointed out, this might not be available in US markets.
"CXMT currently has two 12-inch DRAM fabrication plants — or fabs - in Hefei and one in Beijing, with a combined capacity of about 300,000 wafers per month.
With the new Shanghai facility and other new capacity, CXMT will double its DRAM wafer output to approximately 600,000 wafers per month, all three sources added."
https://www.reuters.com/world/china/chinas-cxmt-wins-3-billi...
This is probably my ignorance but why are we assuming that CXMT capacity will also not be gobbled up for datacenters?
If I'm not mistaken I believe that CXMT's fabrication process is not suitable for manufacturing within the super tight tolerances that are needed for data center HBM, but I may be mis remembering. I think I recall a chart from somewhere showing that frontier memory manufacturers could achieve something like double the memory throughput for example.
It's almost like these companies WANT a dystopia with a centralized winner-takes-all power structure. Anything in the name of profits, who gives a fuck about humanity and distribution of rights or freedoms.
This seems completely sourced from twitter rumours. No mention of NVidia either.
Apple has no excuse to be cornered when it had $300B in cash sitting. They f’ed up big time.
Well, you know what they say. The best time to blow tens of billions you might never get back on a risky memory fab in your home country is ten years ago. The second best time is today!
Its a good thing the data centers in the Gulf states didnt get bombed.
On the bright side, this will further accelerate the retro computing scene as people throw their hands up at the thought of building something shiny and new
I was hoping not to have to keep my current machine until it classified as retro....
yours is already a horse and carriage at this point, might as well send it to me
When will supply catchup with demand?
That's the neat part: it won't until some kind of market dominance is established and maximally exploited by the biggest players. Like during the pandemic when the biggest companies got bailed out while smaller businesses got crushed, permanently shifting the power balance. It's almost as if by collusion.
I think it's time we start talking about putting limits on how much compute AI companies can purchase or own, relative to the rest of the world. It's not fair that they can use trillions of dollars of investor billionaires money to consume all of the resources that everybody needs. Where is fair distribution? What about all of the industries they're destroying in the process by hoarding it all for themselves?
Otherwise, there will be no end to this. There are no hard limits on the speed of a parallel bruteforce. It's an infinite complexity problem class. The more parallel bruteforce power you have, the more likely you are to be able to solve a problem. So there is no world where demand ends. So if something isn't done about this, we'll have million dollar GPUs and RAM sticks because they've priced everyone out of the market and are the only ones able to afford them. Say goodbye to owning your own hardware at that point.
How could you enforce this?
https://en.wikipedia.org/wiki/Cornering_the_market
Right now, the RAM market is effectively cornered. Anti-trust enforcement is what I'd look to, but the GOP do not believe in ensuring competitive markets / enforcement. (The current admin is pretty clearly 110% pro corporation.) Vote in November, but in all likelihood, there won't be government intervention earlier than 2028, and even that is optimistic. One hopes the AI bubble pops, but I think this market can remain irrational for far longer than I can keep old hardware alive.
I called this almost a year ago that the way things are going that home users and pc enthusiasts will be priced out of computing. And the best thing for the rest of the world is China reaching on parity on node side and crash the market. What would be the prices today if Chinese companies were not forced to build their own chips.
This is the first time that I hope that china fucks this up
we're driving consumer prices up and delaying the climate transition for Rube Goldberg slop machines. In case any future historiographer decides to go with the title "the age of intelligence, our stupidest period yet" I'd like some royalties
The good thing is that we no longer consider RAM is free and forced to develop more efficient program (hopefully)
What about Samsung Hynix cartel? Were they punished already?
Pretty soon we'll see a renaissance in the tech that we gave up years ago or can still be improved
- memory compression algorithms
- alternative LLM architectures that don't rely on memory or GPUs
- compatibility hardware (like DDR3 to DDR4 boards)
- distributed computing improvements, both at local GPU and networking levels (SLI for AI)
- GPU hacks to add more memory or support older architectures
I'm personally looking forward to the new LLM architectures that don't require as much compute, e.g. DLLMs, which can be good enough for CPU usage but lack the accuracy of frontier models currently.
When this happens the bottom will fall out of the GPU and memory markets, putting a glut of cheap hardware out there.
Doom mongering like this never seems to include these as viable future alternatives, which is standard market adjustments, I wonder who the doom narrative helps? :)
I can't even read this blog post because Cloudflare's "security verification" fails over and over again. The internet sucks now.
You are not missing much, besides the somewhat intimidating mugshot of a German dude as the header image.
DRAM pricing has historically been cyclical in nature, and the only reason for the current high DRAM pricing is that current AI inference is unnecessarily RAM intensive/inefficient.
Interesting effect is that since DRAM production tooling has been switched from DDR/GDDR to HBM, we may finally see the proliferation of HBM in consumer GPUs/accelerators after the bust cycle starts.
There's no indication that this will change, and every indication this will continue to grow. This is not some temporary thing. Demand is already exponentially higher than what is possible to produce, and there's no current reason to believe it has any ceiling.
I've actually done some work and was able to get the full 12GB Z-image Turbo to run on my 8Gb 3070, and throughout the generation only 600MB of VRAM was allocated (you can get a speed-up by double buffering, but the maximum VRAM was still only ~1GB through inference). It's very experimental and pretty much requires you to write all the compute kernels directly specifically against that particular weight and statically allocate the memory at compile time instead of using current ML frameworks like Pytorch/JAX, but I think in time somebody else would figure it out.
I fear that, whenever consumer-facing supply finally starts to return, the opportunity cost will be priced in. Consumer RAM may end up being nearly as pricey as HBM for a while, and I don't see any reason why it would ever go back down on it's own, unless there are entirely new fab processes that don't meaningfully overlap HBM.
This article is certainly a bit light on details. I'd prefer some more fine-grained and thorough analysis when it comes to this. Like, honestly, I'd have learned more by just asking Claude.
This assumes the current demand will continue. Which is unlikely given the order of magnitude difference between capex by the Big Folks and the revenue generated by that capex. Given they now need to fund this spend from money markets, they are likely to be told off pretty soon. Feds go “ooh” and Google goes “aah”.
What kind of article is that? No explanation, no thoughts, just an empty "trust me bro" prediction from a website that usually publishes consumer hardware reviews.
And the article doesn't even appear in their homepage.
And the author is somebody from a company that "provides you with quality RAM"
Flagged. How did this even get to HN ?