Mastodawn

Plenty of people is blaming "AI" in the abstract for the recent RAM price spikes, but I haven't seen anybody around here point to the actual and direct culprit of it all: Sam Altman secretly bought 40% of silicon wafers (not even produced RAM, just the silicon wafers) from two of the biggest RAM manufacturers, at the same time. Not even with specific plans for what kind of RAM do with them. This is just to mess up with competitors.

Seriously, you can't hate OpenAI enough.

https://www.mooreslawisdead.com/post/sam-altman-s-dirty-dram-deal

Sam Altman’s Dirty DRAM Deal

Or: How the AI Bubble, Panic, and Unpreparedness Stole ChristmasWritten by Tom of Moore’s Law Is DeadSpecial Assistance by KarbinCry & kari-no-sugataBased on this Video: https://youtu.be/BORRBce5TGwIntroduction — The Day the RAM Market SnappedAt the beginning of November, I ordered a 32GB DDR5 kit for pairing with a Minisforum BD790i X3D motherboard, and three weeks later those very same sticks of DDR5 are now listed for a staggering $330– a 156% increase in price from less than a month ago! At

Moore's Law Is Dead

Nelson Lopez Dec 6

@starsider ironically. that thumbnail looks AI generated

NiceMicro Dec 7

@nelson @starsider maybe that's the intention?

Nelson Lopez Dec 7

@nicemicro @starsider so, the way to protest AI as an ever-expanding hellscape, is to... use AI?

NiceMicro Dec 7

@nelson every time you use their product, they lose money.

@nicemicro @nelson

every time you use their product, they have one more user to brag about to investors.

NiceMicro Dec 7

@alexia @nelson good, let those investors give them more money so those investors also lose money.

@nicemicro You're right

Nelson Lopez Dec 7

@nicemicro yeah and keep on harming the environment, god, some of you should just go outside and just actually develop common sense

NiceMicro Dec 8

@nelson I don't have a car, so I've made up all my AI usage in advance for like 30 years.

Nelson Lopez Dec 8

@nicemicro ????? And???????????

NiceMicro Dec 9

@nelson clean your keyboard, your question mark key might have gotten stuck from something.

@nicemicro @nelson No, it doesn't work like that. Every time you use their product, they don't lose money. They may even have more of it thanks to you. You're not wasting their money, you're wasting their investors' money. And you're telling the investors that the demand is real and that they will achieve AGI or whatever by 2030 and get incredible returns for their investment.

They won't, but that's irrelevant... The issue is that the longer this bubble keeps going on before it pops, the worse it will be for all of us when it finally bursts. The great depression of '29 will be historic.

🆘Bill Cole 🇺🇦Dec 7

@nelson @starsider Sam Altman has never looked that joyful.

J. "Henry" Waugh Dec 6

@starsider the thing I also really like about that article

Is it points out the systemic reasons why the shortage is as bad as it is -- such as the various political fuckery the US is doing right now

The fact that the "buffer" mechanisms that normally prevent this from happening are ineffective due to circumstance, I consider the real story here

Sam Altman gonna Sam Altman. It's his job to make headlines and fool investors

It's the whole system's state why the rest of us pay so dearly

Resistor McResistanceFace Dec 6

"Ultra Processed Intelligence (UPI) is bad for your health and wallet" - a potato chip

AI is a sales tool first, ideology check second and environmental disaster third. Yet, Citizen's United will grant it personhood over people of color

@starsider I’m gonna be honest I’d need another source than MLiD to believe this. It’s practically the daily mail for chip enthusiasts.

J. "Henry" Waugh Dec 6

@nepi here you go

(They cite the Samsung press release itself, so there are no Woozles here)

https://www.tomshardware.com/pc-components/dram/openais-stargate-project-to-consume-up-to-40-percent-of-global-dram-output-inks-deal-with-samsung-and-sk-hynix-to-the-tune-of-up-to-900-000-wafers-per-month

OpenAI's Stargate project to consume up to 40% of global DRAM output — inks deal with Samsung and SK hynix to the tune of up to 900,000 wafers per month

Working at scale.

Tom's Hardware

Mike Spooner Dec 7

@jhwgh1968 @nepi @starsider including the tid-bit "Additionally, Samsung SDS has secured a reseller role for OpenAI services in South Korea". Yikes.

@starsider The fact that just one person had enough power to do that should embarrass us as a society; how the fuck did we even get here?

@Johns_priv @starsider
800 million users for ChatGPT alone. That's why.

@starsider Not just OpenAI.

> The market had almost zero safety stock left due to tariffs... [and other factors]

It's not even the presence of tariffs that caused this, it's the constant wavering. Everyone figured they'd just wait for the next relaxation in them to grab them.

Almost makes me wonder if there's more to this story - if openai, with their government connections, influenced the tariffs specifically to achieve this result...

Gabriele Svelto Dec 6

@starsider I've seen this repeated many times already but the truth is that OpenAI did not sign deals - as in binding contracts - but letters of intents to buy RAM. Not the same thing. And it should be obvious why: from the little we know about their financials OpenAI simply does not have the money to buy that much RAM. This whole madness is not based on actual demand, but on the appearance of it. Everything about AI is about appearances, not substance.

@gabrielesvelto They're not buying RAM, they're buying wafers. They made this deal with two companies the same day, and each of them didn't know about the deal with the other one. Of course the price spike is because of all the panic buying and stockpiling and not directly of this purchase, but buying the wafers affect RAM production long term.

Gabriele Svelto Dec 6

@starsider no, they're not. They're not buying anything. Don't trust that article, go read primary sources: https://news.samsung.com/global/samsung-and-openai-announce-strategic-partnership-to-accelerate-advancements-in-global-ai-infrastructure

> OpenAI, Samsung Electronics, Samsung SDS, Samsung C&T and Samsung Heavy Industries today announced a letter of intent (LOI) [...]

Note, OpenAI can lie about this, because they're not a publicly traded company. Samsung is, and if they had signed an actual multi-billion dollars contract they'd have to report it.

@gabrielesvelto From your link: "With OpenAI’s memory demand projected to reach up to 900,000 DRAM wafers per month"

So OK, maybe "bought" is an exaggeration, but "is reserving 40% of RAM wafers" is still pretty impactful, esp. considering they did it unbeknownst to the other company.

Gabriele Svelto Dec 6

@starsider that statement is written on water until they sign an actual deal where OpenAI puts forwards money to pay for it, and OpenAI is extremely unlikely to have that kind of money. That being said Samsung management can make stupid decisions and reallocate production based on that letter of intent alone. Or they can not do it at all, because the chaos this has caused is already benefitting them, at least in the short term.

@gabrielesvelto Samsung has already reallocated production to deny RAM chips to... their own phone division.

Gabriele Svelto Dec 6

@starsider that's also somewhat I've seen reported and it's not entirely clear what's happening. The primary source is this article in Korean and I cannot attest its veracity: https://m-sedaily-com.translate.goog/NewsView/2H1K8OF01L?_x_tr_sl=auto&_x_tr_tl=en&_x_tr_hl=en&_x_tr_pto=wapp

Samsung denied it, but regardless of what is being said the price increases are real and they will affect their phone division.

[단독] 삼성 반도체, 갤럭시 D램도 분기별 계약

산업 > 기업 뉴스: 삼성전자(005930) 반도체(DS)부문이 스마트폰을 생산하는 모바일경험(MX)사업부의 메모리반도체를 분기별 협상에 따라 공급하기...

서울경제

Gabriele Svelto Dec 6

@starsider this is no different than what happened with fossil fuel supplies after Russia invaded Ukraine. There were never actual shortages and demand shrunk, but that didn't prevent financial manipulation from making the prices go up by ten times purely on the presumption of shortages

Ray McCarthy Dec 6

@gabrielesvelto @starsider
They never will without borrowing.

OpenAI can't possibly make a profit.

Their product is also no better than a toy.

The Emperor is in the Altogether.

lain, author of the quixote Dec 6

@starsider so he's just throwing them away with his unlimited money?

@lain I have no idea what he will do with the wafers.

DefinitelyNotRabbit Dec 6

@[email protected] @starsider Dont worry, he thinks its unlimited because he wants the US gov to bail out his company

Parker Banks Dec 6

@DefinitelyNotRabbit @lain @starsider US government just needs to do an OpenAI/Taylor Swift concert merger to create the ultimate economic machine to defeat China

Parker Banks Dec 6

@lain @starsider It's a pity this isn't like the GPU shortage of 2020-21 where I could buy a bunch of cards, burn them out crypto mining, then sell them used for more than I bought them.

DefinitelyNotRabbit Dec 6

@starsider And added cherry to the fkery that is OpenAi
They're trying to get a bailout because they're unprofitable

Whilst they're using their capital to actively market manipulate to the point of creating shortages

Fritz Adalis Dec 6

@starsider
That fucker.

John Timaeus Dec 6

https://www.scottsdalemint.com/articles/2024/the-hunt-brothers-how-two-billionaires-broke-the-silver-market/

Christopher Phillips 🏳️‍🌈🇨🇦Dec 6

@starsider One look at this pile of excrement and it’s obvious he’s nothing but trash, through and through.

@starsider Yup, #bigtech have names and faces. Call em out.

NiceMicro Dec 7

@starsider I wonder... how do they have money for all those chips? Last time I checked they were losing money even on their highest paying customers.

@nicemicro My post was a slight exaggeration. They are not buying them outright, more like reserving them.

Nicole Parsons Dec 7

Fascist movements are escalating & getting into supply chain attacks.

The prelude to WW2 saw the same.

https://en.wikipedia.org/wiki/Prelude_to_the_attack_on_Pearl_Harbor

https://www.thebignewsletter.com/p/monopoly-round-up-monopolies-and

Monopolies are a national security risk.

Prelude to the attack on Pearl Harbor - Wikipedia

@starsider oooof he wants to really cement his position in manipulating and scalping the semiconductor market like Ford did back in 2020

@starsider ....although Ford didn't think to lock away the supply of raw silicon wafers. That's kind of amazing.

For once I actually wish Monsanto was still manufacturing those! And... it's... utterly sad when I wish Monsanto had increased contact with ANY industry.

ChookMother 🇦🇺🦘Dec 7

@starsider When the AI bubble bursts, all this stuff will be really cheap. So we're told.

Chris Mills Dec 7

@starsider @sknob it was watching this that prompted the YouTube algorithm to bring me octopus jazz.

Marius Gundersen - mdg 🌻Dec 7

@starsider the fallout from the AI bubble is gonna last for a very long time, and nobody responsible for this (cough Sam cough) is going to be punished for it.

Pablo Martínez Dec 7

@starsider this is why most people hate billionaires, and why most of the fediverse hates AI companies

Weekend Editor Dec 7

Isn't this sort of market manipulation illegal?

Or is it just like the Hunt brothers attempting to corner the silver market in 1980?

Billionaires are just no good. Over, and over, and over, and...

https://en.wikipedia.org/wiki/Silver_Thursday

Silver Thursday - Wikipedia

Given so many other things in life need memory (Cars, Planes, TVs, Washing Machines, etc) if they all suffer huge price increases that slow or stop people's purchasing choices, this could trigger a global recession.

@starsider yes, and they should not be allowed to buy up that capacity to begin with, let alone should there be a tripol known to collude in terms of pricing!

RAM: WTF?

YouTube

@starsider Also #Micron decided to give everyone a middle finger and cancel #B2C products entirely, artifically reducing #supply for #RAM & #Flash / #SSD|s even further.

WTF Just Happened? | The Corrupt Memory Industry & Micron

YouTube

@starsider But I thought Sam Altman just wanted to make the world a better place!

Burak Gürsoy Dec 13

@starsider first crypto and now this. It will eventually pass, but suddenly Apple pricing is not that ridiculous,