Report: Memory makers curb supply to drive up prices


— 9:43 AM on December 22, 2008

Could the downward spiral of DDR2 memory prices finally reverse? A new report by DigiTimes suggests so. The site says DRAM makers have curbed supply in order to drive up prices, and their efforts have already succeeded. Pricing for "effective tested" 1Gb DDR2 chips reportedly went up 18% on December 18, while "branded" 1Gb DDR2 chips became 13% pricier.

DigiTimes cites three factors for the price hike: Hynix has reportedly cut DRAM output by 20%, distributors have been clearing their inventories "for several months," and DRAM makers have started filling only some orders from some customers. Government backing probably hasn't hurt, either. German memory maker Qimonda announced yesterday that it has received a €325-million ($454 million) financing package, and nearly half the money comes from the government of Saxony.

With that said, DigiTimes quotes Taiwanese memory makers who believe curbing supply "can only be effective in the short-term," and only actual growth in consumer demand can turn the situation around. In the meantime, 4GB DDR2-800 dual-channel memory kits from major manufacturers are still selling for $37 at Newegg.

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