Gadgetory

welcome back to harbor unboxed now you probably noticed that 2017 was one of the most exciting times in a long time to be building a new computer despite that though it did actually all start off with a somewhat boring and disappointing fashion in January with the release of intel's underwhelming kb lake cpus which offered no real improvements over 2015 skylake architecture factory overclocking really was the name of the game there things though change dramatically in March as AMD finally released their hotly anticipated Zen architecture with the rise in seven series and with that ended half a decade of getting bulldozed by the competition from that point forward it was a busy we also got some new GPUs and Intel had a second go at things with coffee-like however while there was a lot to get excited about when it came to PC Harbor in 2017 it was also plenty to be upset about as well or at least frustrated unfortunately some of these problems have gotten worse and probably will continue to worsen throughout 2018 and it's making building a PC right now increasingly difficult so let's talk about these issues I've decided to break this topic up until what will probably end up being a three-part series and in this part part 1 we're going to talk about ddr4 memory pricing and why it's so high right now so let's get into that the big issue plaguing those wanting to build a new computer even update an old one whether it be for gaming or productivity is ddr4 pricing from July 2016 to July 2017 a 111 percent increase for the average selling price of ddr4 memory was seen that's an insane increase over a 12-month period and the worst part being that it's continued to increase since then what this means is for the consumer an 8 gigabyte ddr4 2400 memory kit cost around $35 u.s. in 2016 a year on you could expect to pay a little over $70 for the same product now fast forward today and consumers are faced with an asking price of at least $90 so that's about a hundred and seventy percent more than what we were paying roughly eighteen months ago so why has DDR for pricing increased so much in the past eighteen months as is always the case when DRAM pricing explodes it's a supply and demand issue right now demand is heavily outweighing supply it's difficult to predict when supply will improve but most reports suggest that this will happen in late 2018 when the manufacturing of 64 layer and 96 layer 3d NAND flash reaches maturity okay so it's a supply issue but why what does cause supply to either decrease or demand to increase well I believe we've been faced with a sort of double whammy situation the major DRAM suppliers shifted focus away from ddr4 production due to tight margins had I've been investing production elsewhere in previous years growth in the traditional desktop computing sector was slow and this meant nobody wanted to pay a premium for ddr4 products and as a result manufacturers didn't want to make the memory if they're not going to achieve their planned targets and returns with limited demand in late 2014 with Intel's Haswell II and has multi P range which continue in 2015 with skylake and then again 2016 with Broadwell the limited supply wasn't really an issue however in 2017 we saw a rapid shift in market demand towards desktop computing not just Intel but now AMD were also shipping process is supporting ddr4 memory no doubt you can also blame cryptocurrency miners for the demand in ddr4 memory in 2017 I'm sure many of the mining rigs built that year did use ddr4 memory further increasing the demand and this is probably an even bigger factor is the smartphone industry which drove up the demand of not just DRAM but also NAND as well it's a different type of ddr4 memory that's produced for the mobile market a low powered ddr4 lpddr4 for short memory manufacturers such as Samsung they make more profits selling lpddr4 memory and premium smartphones hence the shifting capacity so at that point demand started to outweigh supply prices increased and ddr4 margins were no longer tight by mid 2017 the price of memory modules has soared significantly as we saw in the example given earlier ok though that's not really a problem memory manufacturers will just ramp up production and we back to the way it was in 2016 happy times for PC builders well sadly no according to market research firm DRAM exchange the three major ddr4 supplies being Samsung SK Hynix and micron slowed down their capacity expansions and technology migrations to maintain prices in 2018 at the same levels seen in the second half of last year obviously they're doing this to sustain strong profit margins this means you probably shouldn't expect ddr4 memory pricing to fall anytime soon certainly not too much later in the year the construction of new fabs is underway to help the strain supply but they won't be ready for mass production until 2019 at the earliest that's predicted by Gartner that ddr4 pricing will crash in 2019 history would suggest this is likely to happen as it's the sort of cycle we go through every few years with memory pricing China does have the potential to change things here though their aggressive approach to the semiconductor market could cause price and become even more unpredictable for example Chinese memory could flood markets worldwide causing pricing to plummet right now there is a large number of Chinese owned fabs under construction and it is expected that China will overtake second place for investment in semiconductors this year as it equips many of the new fabs that began constructing in 2016 and 2017 it's also been reported that China's National Development and Reform Commission is investigating the possibility of DRAM price fixing between the major industry players and this of course has been sparked by the price surge that we've been talking about if found guilty I'm not sure what the ramifications would or could be so we'll have to see how that story plays out it would appear though that they do have quite a bit of power here as SK Hynix and Samsung both have a number of facilities within China so in 2018 you have a choice hold off on building your new PC or just take the hit on memory pricing ideally these days PC gamers will want a 16 gigabyte kit and those cost at least a hundred and seventy dollars u.s. though decent kits our price closer to $200 granted it would have only cost you around 70 to 75 dollars in the good old days but try not to dwell on that unfortunately it's out of our hands the problems PC gamers face looking to upgrade or we're still build a new PC from the ground up and more than just inflated ddr4 memory prices in the next part of this series which will be online in a few days we're going to discuss graphics card prices we'll talk about what happened last year and why why it's continuing and what you can expect later in 2018 so stay tuned for that I'm your host Steve I'll catch you again next time