Comment by seanmcdirmid
1 day ago
We’ve been through multiple cycles of scarcity/surplus DRAM cycles in the last couple of decades. Why do we think it will be different now?
1 day ago
We’ve been through multiple cycles of scarcity/surplus DRAM cycles in the last couple of decades. Why do we think it will be different now?
> Why do we think it will be different now?
Margins. AI usage can pay a lot more. Even if they sell less than can still be more profitable.
In the past there wasn’t a high margin usage. Servers didn’t charge such a high premium.
Do you not think that some DRAM producer isn't going to see the high margins as a signal to create more capacity to get ahead of the other DRAM producers? This is how it always has worked before, but somehow it is different this time?
> Do you not think that some DRAM producer isn't going to see the high margins as a signal to create more capacity to get ahead of the other DRAM producers?
They took the bite during COVID and failed, so there's still fear from over supply.
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High margins are exactly what should create a strong incentive to build more capacity. But that dynamic has been tamped down so far because we're all scared of a possible AI bubble that might pop at any moment.