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Comment by semiquaver | Hacker News Reader

> Seems like it is

Do you have a citation for what law is being violated? Or just vibes?

It's possible this could be construed as price fixing. If the DOJ cared it could open an investigation, leading to a suit, leading to discovery of communications between Altman and all the other relevant players. If price manipulation is an apparent factor in their decision making it may be a very easy case.

https://fortune.com/2025/11/23/ai-rivals-like-openai-nvidia-...

Obviously kind of a moot point because whether it violates antitrust law or not, what is guaranteed is the US Government is not going to do anything

Whether the Clayton and Sherman acts apply to the Stargate initiative is not relevant to this RAM-hoarding activity.

Market manipulation is a crime under the Securities Exchange Act of 1934. You can't buy things to influence the price or the market, only to use or resell.

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

That'd probably make more sense if there wasn't also 50 other tech companies buying up RAM for the same reason (a sudden huge spike in demand due to AI taking off).

It's about volume, not a naive count of consumers. Article claims that OpenAI holds contracts for 40% of world DRAM production. That's just really obviously manipulation if they can't actually power those chips, come on.

So the prosecution will gamble that OpenAI won't in fact use the RAM in a relevant timeframe and they only bought them to exclude the other swath of AI companies from competing?

From the article

> OpenAI isn’t even bothering to buy finished memory modules! No, their deals are unprecedentedly only for raw wafers — uncut, unfinished, and not even allocated to a specific DRAM standard yet. It’s not even clear if they have decided yet on how or when they will finish them into RAM sticks or HBM! Right now it seems like these wafers will just be stockpiled in warehouses – like a kid who hides the toybox because they’re afraid nobody wants to play with them, and thus selfishly feels nobody but them should get the toys!

I guess we'll have to see if they in fact just keep "unfinished" RAM in warehouses like the article says and not roll them out into datacenters for a legitimate use as they are finished.

They mean to resell them in a different form: as part of their PaaS or SaaS. Per the article, OpenAI is just hoarding the wafers, not purchasing the final product.

Do you think OpenAI plans to trade the semiconductor market? This would only apply in that scenario.

No, they want DRAM to be expensive to give them a competitive advantage over their competitors.

It's interesting that this isn't actually illegal to do except in the specific context of an exchange market. I did a very cursory search of the US Code and the Securities Exchange Act of 1934 and yeah, unless there's some additional legal precedent or other applicable law I didn't find, then this might just be a gap in the law.

It even seems to skirt around notions of illegal vertical integration. For example in this address from 1998, a former FTC commissioner describes several types of illegal "vertical alliances", all of which rely on both the upstream supplier and the downstream consumer being aligned in anticompetitive intent, which (if the article is to be believed) they couldn't have been here because there are two suppliers who were unaware of each other's deals.

Is it really not illegal to just buy up a huge chunk of a critical input for an industry and stockpile it for the purpose of locking out competitors? Seems hard to imagine that some robber baron of the 19th century didn't already do this.

Let's not forget that if it's not illegal now, it could be illegal in a matter of days. Add 12 if a president decides to sit on their thumbs, it's happened before.

> Seems hard to imagine that some robber baron of the 19th century didn't already do this.

They tried it and lost their shirts. When you hoard a critical input, that input doesn't just disappear. You spend huge amounts of money pushing the price up, and then the market price turns against you as people finally figure out that the hoarding was just a stunt, that you don't really have a higher-valued use for the stuff you hoarded, and all of it is going to be right back on the market sooner or later.

It's hard to tell from the news but it sounds like they've negotiated contracts for a recurring stream of DRAM rather than just trying to buy a ton of it on an open market. Wouldn't we be stuck with high prices until manufacturing capacity increases and/or the deal expires?

Not exactly the 19th century, but in 1980 Softsoap bought up a year's worth of manufacturing capacity of hand pump mechanisms in order to block competitors from entering the consumer market for liquid hand soap.

I didn't know about this history. Looks like it actually worked out great for them.

Oops I forgot the link to the FTC document https://www.ftc.gov/news-events/news/speeches/vertical-issue...

and here's a followup from the same commissioner https://www.ftc.gov/news-events/news/speeches/vertical-issue...

The law you refer to applies only to markets for securities. RAM is very clearly not a security, it fails the Howey test.

There are similar laws prohibiting the manipulation of commodity markets but I do not believe a US court would find RAM to be a commodity.

How is RAM not a commodity?

It doesn't really matter, because the first question is: can the government suspend the contract (injunction?) while this is sorted out.

There's also the question of if OpenAI operated In good Faith (from a search: "Another sign of bad faith is withholding crucial information..."), and- of course- the South Korean government can step in as well. In fact- as a worldwide issue- any sufficiently large State(or group of States) can take issue with it.

OpenAI will have issues if they find themselves unable to buy power equipment (Schnider, Eaton). Or, perhaps anybody associated with OpenAI management or funding is arrested the second they step foot in Europe. This is already a nightmare of an International Incident.

It may be a commodity, but there is no established commodity market for RAM in the US, as there is for energy and agricultural products. The laws relate to the manipulation of a commodity market. Commodity markets are usually established where the products are produced, not where they are consumed.

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