[Chip memory prices continue to rise, Samsung, etc. are subject to antitrust investigations in China] For Samsung, the chip can be said to be the "engine" of the entire electronics business. Thanks to the rising prices of DRAM and NAND flash memory, Samsung chips ranked second in the last year. The quarter also surpassed the oldest Intel and "attacked" Apple in single-quarter profits.
However, for hardware vendors, the rise in the price of chip memory makes them "terrible."
"After soaring 40% last year, DRAM prices are still rising from the beginning of the year to the present. Although the rate is less than 10%, it is eroding the profitability of Chinese brand factories that originally had relatively small profit margins. "Wu Yating, chief analyst at the Semiconductor Research Center at the State Semiconductor Group, told a financial science journalist that the investigation of the Big Three shows that the rise in DRAM prices has left downstream companies in a state of high pressure.
Research firm DRAMeXchange showed that in the first quarter of 2018, the three largest manufacturers of memory, Samsung, SK Hynix, and Micron, accounted for 44.9%, 27.9%, and 22.6% of the DRAM industry respectively. The combined storage giant's 95.4% share shows that The DRAM market has apparently assumed an oligopolistic pattern. China is the world’s leading consumer of memory chips. Due to the price increase of memory chips, China imported storage chips of 88.921 billion US dollars in 2017, an increase of 39.56% year-on-year to US$637.14 billion in 2016.
Since last year, companies including mobile phone makers have successively complained about rising storage prices. According to media reports, on May 31, China's anti-monopoly agencies have suddenly launched offices of Samsung, Hynix, and Micron in Beijing, Shanghai, and Shenzhen. The investigation marks the official launch of the investigation by the national anti-monopoly agency on the three companies. At present, the three companies have not responded to the outside world.
China is the largest storage demand country
The soaring of memory prices in recent years has caused many speculators to make a lot of money and is known as a “business that makes more money than real estateâ€. â€
From the second quarter of 2016, DRAM (mainly including PC memory, mobile memory, and server memory) prices soared, and sales records were refreshed every quarter. According to the latest data from IHSMarkit, global DRAM output in 2017 jumped by 72% to reach US$72.2 billion. In 2018, it is expected to further increase to US$84.4 billion, with an annual growth rate of 16.9%. The last time such a grand scene appeared was still 23 years ago.
Wu Yating, chief analyst at the Semiconductor Research Center of the State Semiconductor Group, told reporters that since last year’s price soared by 40%, the price of DRAM has still been rising from the beginning of the year to the present. Although the rate is less than 10%, it’s inherently less profitable. For the Chinese brand factory, it is under no small pressure.
According to the reporter, the cost of storage in mobile phones has reached 25%-35%. At the same time, due to the rapid price increase of memory chips, prices of mobile phones, solid-state hard disks, memory sticks and other products have been gradually increased. Among them, the crazy memory is a 300% increase in one year.
In addition, the Chinese market has digested DRAM and NAND globally by as much as 20% and 25%, which is the largest demand for memory.
According to DRAMeXchange's analysis, although China is actively carrying out semiconductor construction projects, it still needs at least several quarters of time to achieve the goals of “independent technology research and development†and “stable mass production scaleâ€. The immediate need to solve cost pressures is far-reaching. Can not save the near fire. In addition to this interview with Micron, Samsung Semiconductor, the leading memory manufacturer, was also interviewed by China's National Development and Reform Commission at the beginning of this year. Although there is no evidence that the two incidents are related, it is enough to show that the official price of DRAM has soared. The importance attached.
"At present, it is still at the beginning of the investigation stage, and no specific monopoly case has yet been identified. However, from the perspective of impact, the increase in DRAM prices will continue to be curbed," Wu Yating told reporters.
"Price Alliance" has been surveyed across the country
The huge increase in DRAM has brought huge profits to these chip giants.
According to the statistics of Micron, Samsung and Hynix, in 2017, the three companies’ semiconductor business revenues in China were US$10.388 billion, US$253.86 billion, and US$8.908 billion, totaling US$44.68 billion, which was a year-on-year increase of US$32.1 billion in the 2016 fiscal year. 39.16%. Its revenue in the first quarter continues to grow. From the financial report, the operating profit ratio (OPMargin) of the three major DRAM manufacturers in the first quarter of this year has reached a water level of 50-70%, which is not only the highest in history. The profitability of the product even exceeds that of a higher-level CPU.
In fact, after receiving complaints from mobile phone manufacturers, regulators have begun to pay attention to the storage market that has continued to increase prices last year. At the end of 2017 and May 2018, the Chinese anti-trust agencies interviewed Samsung, respectively, on issues of continuous price increase. Micron.
“The most important reason for the appointment of Micron was that the standard memory has increased for several consecutive quarters, which has led to an increasing cost burden for Chinese manufacturers, and the restriction of suppliers of equipment suppliers to Fujian Jinhua has been a deterrent to fair competition. The first was 2018. Season Samsung, SK Hynix, and Micron have a market share of approximately 96% in the DRAM industry. Compared with the semiconductor components used in other end products, it appears that this has become a monopoly condition. The future of antitrust investigations may continue to occur. , and may inhibit the memory gains." Wu Yating told reporters.
Wu Yating added that according to the anti-monopoly investigation, there were precedents in various countries.
From 2005 to 2006, the US Department of Justice had ruled that Samsung, Hynix, Infineon, Elpida, and Micron had monopolised prices between 1999 and 2002, and imposed fines totaling 729 million U.S. dollars for the first four companies. At the end of April this year, Samsung Electronics and others suffered a class action lawsuit in the United States and was accused of conspiring to limit the supply of DRAM memory chips.
A lawyer named HagensBerman filed a class action lawsuit against Samsung Electronics, Hynix and Micron Technology in the Northern California District Court. The law firm claimed that their investigations revealed that these major DRAM manufacturers collude with each other to limit the supply of various DRAM products in the market, artificially pushing up DRAM prices. During the class action lawsuit allegedly, the price of DRAM rose by 130%. At the same time, DRAM sales revenues of Samsung Electronics, Hynix and Micron Technology more than doubled.
Wang Yanhui, secretary-general of the Mobile China Alliance, told a financial science and technology reporter that after the NDRC's investigation into Qualcomm’s anti-monopoly, Chinese companies have learned how to use government power to maintain market equity and they also know how to reflect to the government the inequities that exist in the market. . The anti-monopoly investigation of SAMSUNG by the General Administration of Market Supervision is also a direct result of reports and reports from Chinese companies and industry organizations to the relevant authorities.
"Compared with the European Union, we constantly issued fines for monopoly grounds such as Google, Apple, and Qualcomm. Objectively speaking, due to the limited manpower, China's anti-monopoly institutions are not too big but too small to supervise the market. As the world's largest electronic product The manufacturing base and the second-largest market need a stronger market supervision organization to ensure a fair and just market competition order,†Wang Yanhui told reporters.
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