Windows 7 optimism could bring down hardware prices

Could PC makers have stocked up on too much hardware because of the optimism surrounding Windows 7, in turn paving the way for a decline in prices? That's the question asks in a recent blog post, and it sounds like the answer might very well be yes.

You don't have to look very far for the warning signs. In a research note earlier this month, Gartner predicted that Windows 7 will only impact PC shipments in a "minimal" way. And after posting its financial results a few days ago, AMD reportedly said it expects revenue growth below seasonal trends this quarter. The chipmaker went on to cite "the big build we've seen of PCs in anticipation of the Win 7 launch" as the potential cause. says AMD's comment in particular has cast doubt on Wall Street, leading stock prices for major chip vendors and hard-drive makers to slip. The site says excessive inventory could lead to "both reduced component consumption in Q4 and beyond . . . and lower pricing for memory."

That potential course of events would be particularly bad news for memory makers, which are just starting to recover from quarter upon quarter of oversupply and rock-bottom prices. Contract prices for DDR2 memory chips went above those for DDR3 a week ago, and today, 4GB DDR2 and DDR3 dual-channel kits are practically at parity around the $70 mark. A few months back, 4GB DDR2 kits could be snagged for around 40 bucks.

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