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Comment by stuxnet79 | Hacker News Reader

While I share your optimism, I still don't fully understand why a crash will necessarily lead to an oversupply and lower prices for regular consumers. The components / RAM you are referencing are for enterprise use / data centers which in my limited understanding is not a 1:1 swap for the kind of components that your smartphone / car / fridge / gaming rig use. I would love for someone more informed than me to spell out the rationale here.

It seems the chokehold started from the very beginning of the supply chain (wafers), so if a crash were to occur I don't see how we wouldn't be doubly screwed. Lots of worthless enterprise gear being shopped on eBay + a scarcity of consumer grade components leading to sustained high prices.

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"I've seen gluts not followed by shortages, but I've never seen a shortage not followed by a glut." - NNTaleb

My understanding is that it's fundamentally a fab capacity limit. At a given node size/technology (think 7nm, etc) they can only output so many wafers. If AI data centers are generating enormous demand for memory, then that's what those wafers are going to be used to for, unless they can be outcompeted, hence higher prices.

I'm not actually sure if enterprise designated memory is equivalent or not to consumer designated. Could be they are the same just packaged differently and/or with better binning. Either way, it's the same supply/demand dynamic at work.

Typically (not always!) server memory is 'registered' so won't work with consumer CPUs which run on un-registered.

Does 'registration' introduce anything physically different? Or could they be completely interoperable?

Yeah a RCD on the memory stick, it's PCB is designed around it. The actual DRAM chips themselves are not different though, which is why I mention it would be super easy to produce more consumer unregistered and less server registered at assembly time :)

Thanks for the clarification, that makes a lot of sense!

Memory fabs make a mix of DDR/LPDDR/GDDR/HBM and they continuously adjust the mix to market demand. If demand for HBM drops they will start making more consumer RAM.

The way I understand it is, these fabs have massive overheads so not selling is not an option. It is also relatively easy to pivot production from enterprise to consumer. Now if they all start doing that at the same time to stay in business during the down cycle, an oversupply in consumer chips is possible.

Datacentre NVMe disk is still usable in a standard desktop. Sever memory less so, but essentially if there were no 'new' server market whatsoever then you could redirect 100% of memory production to consumer chips without enormous upheaval.

By the way I personally think this scenario is very unlikely to happen.

> If there were no 'new' server market whatsoever then you could redirect 100% of memory production to consumer chips without enormous upheaval.

> By the way I personally think this scenario is very unlikely to happen.

Can you explain why? I imagine pivoting to a much less lucrative consumer market when the time comes would lead to financial ruin?

We are starting from a frankly completely unimaginable hypothetical that there's 0 new "datacentre demand".

In that scenario producing consumer chips is still profitable, much less profitable but still much better than giving up and going home.

You will also unlock latent demand by the mere fact that consumer prices are reasonable again. Those who may have postponed a new MacBook or gaming PC will likely buy as soon as lower prices return.

> you could redirect 100% of memory production to consumer chips without enormous upheaval

They would never do that. By then the market has changed and they would produce at the limit of expected demand, certainly not intentionally causing oversupply.

Sounds to me like we'll all be using enterprise servers as home computers! Hell yeah!

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