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method114 on 12 December 2014
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Arkaign said:
method114 said:
desosav said:

Everyone cares about money mate. The thing is that MS can reduce X1 price because of cheaper DDR3 modules and continue being profitable. Sony on the other hand with gddr5 modules need to wait before reducing prices. What we need to know is what profit each company makes by selling a console. You know SOny might earn 5$ per console sold and ms 15$ (random numbers)..Additionally you should take under consideration the economic problems sony has the last couple of years which looses 5bn$ per year. On the other hand economic results for ms are green all the way recording, record profits every year.


Are you sure DD3 is cheaper then DDR5? Or are you just assuming that because DDR5 is a higher number then DDR3 that it cost more?  In July I was reading articles that said RAM prices in general were inreasing (I work in IT and PC hardware is something I need to stay current on in order to do my job). It did say DDR3 didn't seem to be fluctuating one way or the other. Could prices have droped so much in six months that they could afford the price drops they are doing now? I doubt it. 

I have had access to Mercury Research Group pricing reports, and cannot post them here (nothing since late summer anyway due to my business structure), but can tell you this :


GDDR5 prices plummeted after the *coin mining rushes failed. They were already falling anyway. This is why you now see many 4GB GPUs slotting in at prices previously reserved for 2GB and 3GB GPUs. Also due to the mining craze, capacity for GDDR5 production increased massively from previous years. So the production facilities have to either be idled, or produce more for less $. I saw prices fall from ~$12/GB to ~$7/GB to ~$4/GB over a relatively short period of time.

This is the usual cycle with memory pricing anyway. Here are the stages relevant to your questions :

Stage 0 : Engineering samples are made after the design is more or less finalized, and sent to OEMs to test with their PCBs or other hardware on their ends. Basically a compatibility/testing/quality/performance measurement stage. VERY high price to get this done.

Stage 1 : First production for release in the market, the 'bleeding edge'era. DDR4 is still roughly in this stage. Production numbers are low, implementation is low, and price/GB remains high for awhile.

Stage 2 : Early mass production. Some major market actors have moved this memory into mass market items, and a lot is needed out there, so production increases. Price/GB is hugely lower than stage 1, but still moderately high. Last-gen memory still being produced in decent volume.

Stage 3 : Mainstread mass production. This memory type is now the de-facto standard for whatever, and pricing is incrediblycompetitive. There may be some price fixing on this due to just how cheap it gets. Cheapest stage for Price/GB. Think last year when you saw sometimes 8GB DDR3 kits for $30-$35 retail.

Stage 4 : Downhill of mass production. Combination of low margins and lowering demand overlaps when OEMs are moving some of their demand to a different standard, which results in manufacturers retooling for the new memory in some cases, idling production, looking at stockpiled inventory, and trying to cut a good balance. This is the current stage of DDR3. Pricing increases steadily.

Stage 5 : Basic EOL of mass production. Due to the stage 3/4 timeframes, enough manufacturers have achieved large inventories of these ram chips, which can be put onto various PCBs with ease, but demand for new memory types along with massive dropoff in demand for the old means production is largely shuttered on this kind (for purposes of this example at least). Pricing increases again fairly significantly.

So that is it. With DDR3, it's already passed the time that it is at its cheapest, and is now on track to steadily increase over time. DDR4 is rising steadily in high-end areas, but will truly make the leap to mass market next year, which will cause DDR4 prices to plummet, and DDR3 prices to rise sharply.

If you want an idea of how it ends, look at this (just purely using consumer-available parts as an example) : 

4GB DDR2-667 $119.99 http://www.crucial.com/usa/en/memory/ct51264aa667

4GB DDR3-1600 $39.99 http://www.crucial.com/usa/en/memory/ct51264ba160b

4GB DDR4-2133 $57.99 http://www.crucial.com/usa/en/memory-ddr4/ct4g4dfs8213

Over the next 6 months, watch the prices on DDR3 and DDR4 start to overlap and move in different directions. DDR3 will eventually be as insanely priced as that DDR2 stick up there, and DDR4 will become very cheap, then start ramping up all over again as the cycle repeats.

GDDR5 is a bit different than all of this. It's more specialized, but also lives in a similar cycle. Pricing is still falling on GDDR5, but eventually this will rise as well when it's no longer mainstream.

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