Samsung is the largest memory chip maker in the world, accounting for about 48% of the DRAM market and 35.4% of the NAND Flash market. DRAM and NAND Flash are the two main memory chips, the former mainly used for memory and the latter used for memory Based on data provided by analyst firm China Flash Memory Market (CFM), in 2017, the global market for memory chips is 95 billion USD, of which DRAM is about 50.35 billion USD, NAND about 40 billion US dollars.
Q3 2016, due to the market demand for storage chips began to enter the price channel, and led to mobile phones, solid state drives, memory and other products have so far prices.Among them, the hot phone is generally raised 100-200 yuan, the new flagship sale Price than the previous stalls with about 300 yuan more than the product, while the crazy memory is 300% increase within a year.
In early 2017, most industry analysts forecast that the price hikes of memory chips will come to an end in the second half of this year according to the manufacturer's production cycle. However, at the moment, the time point for depreciation is basically delayed until the second half of 2018.
Profit soared
'Store, exceed the screen, CPU, become the biggest cost of the mobile phone', a mobile phone manufacturer told reporters that 'the cost of storage in mobile phones has reached 25% -35%, and shipments are not very large mobile phone manufacturers simply no discourse Right, the price can not talk less than this year, different capacity flash memory prices rose more than 30% -40%. 'The person for example,' 32G, 64G flash memory prices are based on 5 US dollars, 10 US dollars raised, 128G price adjustment are It's $ 20, which is scary for handset makers. "
Global memory chip suppliers only Samsung, Micron, Toshiba, Hynix, Western Digital and other companies, of which Samsung, Micron, Hynix in the DRAM market occupy more than 90% market share.
Samsung's latest earnings report Q3 2017, Samsung 545 billion US dollars in revenue, an increase of 29.7%, net profit of 12.76 billion US dollars, an increase of 179.47%. In the first three quarters of 2017, Samsung Total Revenues were US $ 152.456 billion, up 16.8% from US $ 130.446 billion in the first three quarters of 2016. However, profits in the first three quarters of 2017 were US $ 33.81 billion, up 92.3% over the same period of 2009. In the wake of the 'battery explosion' in the terminal business, semiconductors became Samsung's main source of profits.
It is worth mentioning that for the first time in 2017 Q2, thanks to the continued rise in the price of memory chips, the Samsung Semiconductor Group revenue of 15.73 billion US dollars, more than Intel's 14.763 billion US dollars, becoming the world's largest chip maker for the first time.Since June 1, 2016 so far, Samsung Shares rose 90% from 2.53 million won to 2.454 million won in November 2017. Samsung set the highest price in more than a decade to 2.860 million won in November 2017.
According to Taiwan's related industry chain news, Samsung, Hynix successively announced the first quarter of next year to raise the DRAM price of 3% -5%, the price of storage products will continue to rise.
As the largest producer and consumer market of electronic products in the world, China has become the pressure-bearing market with the strongest price hikes, but PC and mobile phone manufacturers have almost no price right in front of several oligarchs Even the most adept at supply chain management Foxconn also can not afford the price, a Foxconn told reporters: 'It has clearly felt the market is saturated, the beginning of the year holding money to buy the product, now is to give money you can buy, but the price is high.'
Price monopoly of the former section
Many industry insiders speculated that there were price alliances among several big oligarchs. After all, this price alliance appeared during 2000 and was later fined 730 million U.S. dollars by the U.S. Department of Justice. It was the second largest anti-trust fine in the history of the United States.
In 2000, the global Internet crisis, the PC market, a substantial decline in size, when Samsung, Hynix, Infineon, Micron and other companies have just experienced expansion, DRAM prices plunged. DRAM market size from 288 billion US dollars in 2000 fell To 11 billion U.S. dollars in 2001.
However, DRAM prices rebounded quickly after the market did not show any improvement, with the price rising more than 300% in half a year, including the direct cost pressures of price hikes by companies such as Dell, HP, Apple and IBM. The United States Department of Justice notes that in 2002, the U.S. Department of Justice issued summons to companies such as Micron, Samsung, Hynix and Infineon to sue the price monopoly and subsequently started the investigation.
During the investigation, Micron Technology took the lead to plead guilty to surrender without penalty. Subsequently, Samsung, Hynix, Infineon and Elpida acknowledged the price monopoly in 2005-2006. Samsung was punished with 300 million U.S. dollars, and Hynix and Infineon Ling, Elpida were fined 185 million US dollars, 160 million US dollars, 84 million US dollars, a total of 729 million US dollars.
Samsung 300 million US dollars mainly for fines for monopoly revenue, the United States Department of Justice found that Samsung in 1999-2002 there is price monopoly during the DRAM sales in the United States reached 1.2 billion US dollars, these sales were fined in accordance with 20%, reaching 240 million It should be pointed out that this ratio is higher than the national standard for fines, after the NDRC penalized Qualcomm for a fine of 8% of Qualcomm's revenue in China in 2013.
Although it is unclear whether regulators will conduct antitrust investigations of the storage products that are currently sustaining price increases, the likely emergence of a price alliance warrants vigilance.
Oligopolistic cartel behavior is not only used to control prices for profit, but it is also often used to crowd out competitors. Now that a year and a half of price hikes have been going on for Samsung and other storage giants to provide more and more cash As Chinese companies enter the memory industry in the future, they will inevitably face price competition from companies such as Samsung, Micron, and Elpida.