Why did the price of RAM double?

Factual Questions
1

Well in the computer world, CPU’s generally get twice as powerful every 18 months or so, for a given price. So the $/MHz ratio halves in that time.
This had been true with RAM as well. I mean in 1992 I had a computer with 1 Mb of RAM, and last year I upgraded to one that had 256 Mb of RAM.

Note that I live in Australia, so the prices I am quoting are approximately half as much in the U.S.

Anyway, about 9-12 months ago, I got 256 Mb of RAM for $69. There were a few places that had it for about that much.

Now the prices have doubled, ($140 for 256 Mb) which is really annoying since I’m a cheap-skate.

So what happened to the price of RAM? And is it going to go right down again soon?

Maybe it is because people aren’t buying many new computers any more, they’re just buying RAM… it must be a big conspiracy though because all the shops are in on it…

2

http://www.ebnews.com/story/OEG20020104S0077

3

Thanks… but I don’t understand why there was a shortage of RAM chips. Maybe it was all those X-Boxes or something…
I think about 7 or 8 years ago there was some kind of earthquake that wrecked a RAM factory… now I can understand why that would raise the prices.

I was just having a look at pricewatch.com and 256 Mb RAM is US$35 now… hopefully it won’t take long to get that kind of price in Australia…

4

Up until around November of last year, RAM prices were artificially low. Manufacturers geared up production of SDRAM and DDR SDRAM, anticipating high demand. That demand never materialized, due to a slumping economy. So, producers were left with more memory than they knew what to do with, and prices plummeted; in many cases, RAM was selling for below cost.

Now, consumers love getting stuff cheap. Manufacturers hate losing money on everything they produce- it’s cheaper to halt production. The result of this was end-users snapping up RAM at bargain prices, and manufacturers cuttting back production. Supply goes down, price is forced skyward. It’s basic market economics.

Note that RDRAM prices have not nearly been as volatile as SDRAM. Prices for RAMBUS have slowly been dropping since its introduction; in many cases, it now costs less than DDR SDRAM. Suppliers must not have miscalculated this market, so the price declines seem to be more a function of improvements in its manufacturing process, rather than fluctuating supply/demand curves.

5

You mean for once in my life I bought something at exactly the right time?

::kisses the bezel of PowerBook containing pair of 256 MB modules purchased for $89 last November::