Samsung to plead guilty in price fixing from 99 - 02
posted Nov 30th 2005 10:00PM
Either Samsung weren't very good at sweeping their dirt under the rug or they didn't want to get in any further
trouble once the looking glass focused in on 'em, but apparently Samsung's fessing up to a worldwide practice of price
fixing DRAM memory between April of 1999 to June 2002. And they'll be paying out the nose for what's supposed to be the
second-largest criminal antitrust fine in US history, too — something to the sum of, oh, say, three hundred mil? Being
DRAM it doesn't seem to directly relate to the
South Korean FTC's investigation of Samsung's
pricing practices for NAND flash memory, but
Assistant US Attorney Niall Lynch did cite Apple, Compaq, Dell, Gateway, Hewlett-Packard, and IBM as beneficiaries of
the Samsung's, um, generosity.
[Thanks, Mike]
LOL
That picture is da.bomb.
Just thought of a great caption for the picture...
"You best be covering your face in disgrace bizotch, cuz you be going down!"
lol :)
Can someone please explain what price fixing is? Thanks. =)
Thats absolutely hilarious
Ha!
Im still laughing...
ahahhahah--love it--hahahahahah
the caption should simply be- "pwned."
Price fixing involves conspiring with competitors to set an artificially high price instead of letting competition within the market decide.
Hint: reading the article helps
I hate to say it Samsung but you got punk'd.
"three hundred mil" is a drop in the bucket for how much they ripped off the consumer (worldwide) in 3 years. And where will this three hundred mil go? Not to those who were ripped off, but to the coffers of the U.S. Govt. Sigh...
#7 Why not "Pwnded", "Pwnage", "Pwnz0r" or "0wnz0red"?
Yea, that's right, cause they aren't f#(*#(%kin words....
300 mill isn't that much to samsung, but there's interest. Who knows how much that'll be. Maybe not much but could be a ton. I agree on #7's caption idea. Plus this opens the door for other lawsuits against them *rambus* and it did say that some of the main players could be held responsible :) So who knows, we may get rambus in our computers in a few years with upcoming chip architecture. I just hope prices now drop on ram because 130-150 for nice quality 1 gig sucks in my opinion.
heheh, someone's got a headache.
Does "pwned" mean pooned as in tang?
l33t-sp3ack sux!
woohoO! Go Cartels!
300mil is indeed nothing compared to how much they ripped us off, plus they get to pay it back over 5 years... Next time you get a speeding ticket, ask the officer if you can pay it back over 5 years...
This is a disgrace, Samsung should pay dearly for this AND give something back to consumers, instead the government gets all the money WE overpaid.
How come only the companies are getting the rebate? Consumers paid the price too.
what's so funny?
does your mom work in Samsung?
US Gov: (to samsung) Maybe THIS will teach you ya layin' dishonest foreigners. In the US of A only WE rip off our citizens! NOT YOU!!!
Of course, they do let CORPORATE america in on the fun too...
i am glad my tax dollars are being taken from me to stop people from voluntarily exchanging goods and services.
i didnt have to buy samsung products. i didnt care what they did. but now i surely have to pay the price of the case against them. how about people just dont buy stuff if it too expensive, and shut their damn whiny mouths?
"i am glad my tax dollars are being taken from me to stop people from voluntarily exchanging goods and services.
i didnt have to buy samsung products. i didnt care what they did. but now i surely have to pay the price of the case against them. how about people just dont buy stuff if it too expensive, and shut their damn whiny mouths?"
I would just like to congratulate you. The sheer stupidity of this comment cannot be topped. Perhaps if you had read the article where it talks about many companies conspiring to fix prices you would recognize that this is an issue of corporations creating artificially high prices, rather than solely a Samsung situation. Samsung has accepted a plea bargain, and they aren't even the sole company to be busted, they've just had to pay the biggest fine so far.
"How come only the companies are getting the rebate? Consumers paid the price too."
again, reading the article will solve this quandary.
"The deal also did not seek restitution from Samsung. Instead, victims _ ranging from other chip makers and computer makers to private individuals _ can sue for damages."
Isn't it amazing what a grasp of basic reading comprehension can do for you?
Now, as a general request: Please, for the love of all that is holy and good, read the article people. You don't want to look as stupid as martin or sygyzy.
everyone is a victim right? they cant just not buy stuff that is too expensive? do we really need this much protection from the government?
again, who was forcing you to buy? why were you a victim in an exchange you entered into voluntarily?
martin/#20: hello? anybody in there? *knock knock*
"everyone is a victim right?"
yup.
"they cant just not buy stuff that is too expensive?"
No, because the largest producers of the memory in question were conspiring to create artificially high prices. You couldn't just buy from another producer, because the other producer was also charging an artificially high price.
"do we really need this much protection from the government?"
YES! unless you want to go back to 1900, when companies could create Trusts and Monopolies in order to force people to pay far above the market price. I, myself, am not a fan of Robber-Barons, but if you are then I suggest that you move to Iran.
"again, who was forcing you to buy?"
The force wasn't in the sale, but in the artificial inflation of the cost. I didn't have to buy that extra 1 gig of RAM, but I wanted my computer to be faster. All major brands had the same inflated cost, so I was forced to buy something that was priced at above market price.
"why were you a victim in an exchange you entered into voluntarily?"
Because the terms of the sale were rigged and illegal.
I am going to request again, martin, that you read the article. This wasnt, I repeat was not, just Samsung.
the terms were not rigged. x memory was sold for x price. nobody was tricked or forced. if that was too expensive they didnt have to buy it. you are not entitled to buy things at the price you think is fair. you dont tell somebody what the fair price is and demand it, then whine to the government.
simply put, you are afraid of capitalism. you want protection from the government that you do not need.
you say "I wanted my computer to be faster...... so I was forced to buy"
you werent forced to do anything. what happened was you want things at prices that you find pleasing, and you want to use the force of the government to take the away the freedom of the market to determine its own prices. all because you want a faster computer and feel entitled to it for the price you want.
victim mentality, always needing help from the government. a thorn in the side of capitalism and prosperity.
I wonder how this will affect their relationship with Microsoft?
"the terms were not rigged."
Yes they were, because a Trust determined the price, not the market.
"Simply put, you are afraid of capitalism. you want protection from the government that you do not need."
Whoo, I'm not entirely sure where to begin on you're fantastically flawed view on economics. Lets start with what a "Trust" is.
Merriam Webster 9th Colligate Dictionary:
Trust- A combination of firms or corporations for the purpose of reducing competition and controlling prices throughout a business or an industry.
Now, a "capitalistic" society is one in which the free market determines the price. However, when companies conspire to raise the price artificially, rather than allowing the market to determine the price, in the manner described above it actually hurts capitalism in several different ways.
1. Companies spend more capital than they have to create a product. When this happens they cannot maximize growth of the company because they cannot produce as many units of the product. Over time, this forces a stagnation of the economy.
2. It increases the economy of scale. Companies have a harder time entering the market because now the costs are higher. This keeps the maximum number of out of the economy. This means that the Economy cannot grow at maximum rate, because the underlying driving forces of growth are limited.
3. Consumers do not buy as much, because the market is not what is determining the price. Again, this means that the economy cannot grow at its maximum rate because the maximum number of consumers cannot purchase the product.
All a Trust does is allow certain companies to become richer at the expense of the consumer and the economy as a whole. Trusts are, therefore, the anthesis of capitalism. Now, moving swiftly on.
"you werent forced to do anything. what happened was you want things at prices that you find pleasing, and you want to use the force of the government to take the away the freedom of the market to determine its own prices."
Again, the market is not determining the price, a Trust is. This creates an artificially high cost which is well above the market price.
capitalism Audio pronunciation of "capitalism" ( P ) Pronunciation Key (kp-tl-zm)
n.
An economic system in which the means of production and distribution are privately or corporately owned and development is proportionate to the accumulation and reinvestment of profits gained in a free market.
If several companies conspire to artificially raise the selling price the market is no longer free. I don't understand what is so difficult to comprehend? If you're still confused perhaps look up the definition of free market.
hey martin
Got some ram at 2002 prices if you want to buy it. Why not promote capatalism, buy my ram, and make me rich.
yeehhaaarrr!!
"Either Samsung werent very good at sweeping their dirt under the rug or they didnt want to get in any further trouble once the looking glass focused in on em"
I'd like to point out that a "looking glass" is a mirror, not a magnifying glass.
when sellers set prices with the intent to make maximum profit, that is an ordinary part of the market. the government intervening is not.
when you have the government intervene, that is not the free market. the market consists of buyers and sellers. buyers are free to not purchase items that are too expensive.
it is not for you to decide what sort of profit is fair and have that forced upon sellers by the government. you have the freedom to not purchase the product. in a free market, sellers can sell for whatever price they choose.
i dont go over to your house and tell you what your stuff is worth, that is for you to deteemine. hell, you dont even have to sell me your stuff if you do not want to. thats freedom. the opposite of that is when you get the government to force sellers to sell at prices that please you.
once again, you need to remember that nobody forces anyone to buy anything. unless of course we follow your strategy, in which case we are forced to pay tax dollars to to buy cases against and persecute sellers.
you might also consider that if you just dont buy the memory at the high price they would make no profits and probably lower the price. and that would not even require government manipulation of the market.
quit thinking like victims and accept the freedom of others to set the prices on the items they own. you set the prices on the items you own.
martin, consumers do in fact need the government for protection against trusts. think about the many situations in which it is practically impossible to have more than one provider of a service, such as a utility company serving a single community. since it's hard to have more than one electric or gas company competing for your business (you can't have five different companies' power lines criss-crossing the city), one company provides the service and the price they charge is regulated by the government.
Wow, this article brings back memories.....
A few years ago, I was the sole distributor of my own designer toy line. I had spent months sculpting, making molds, having them manufactured with boxes and manuals, etc.
I was excited!
After weeks of aggressive marketing, I had sold thousands of toys, which was great! ...Or at least I thought it was. Then, the negative feedback started coming in. It turned out that the quality of my toys was too solid for my selling price-- the buyers demanded a higher price tag that was more in line with the rest of the designer toys out there. The buyers were furious with the affordability!!!
Long story short..... Me being the sole distributor of my toys and offering them for an unreasonable price, the government eventually stepped in and stopped me from continuing my immoral market practices.
I still owe about $450,000 to the government and thousands of victimized customers, but I guess that's just how free market works...
I've learnt my lesson: Never again will I price fix.
Martin is right. That's why I make my own RAM instead of buying from these crooks.
"when sellers set prices with the intent to make maximum profit, that is an ordinary part of the market. the government intervening is not."
NO IT IS NOT YOU GOD DAMNED MORON!
Free Market- A price determined purely by the forces of supply and demand without interference from an outside source.
collusion and Trusts are NOT purely supply and demand.
"once again, you need to remember that nobody forces anyone to buy anything. unless of course we follow your strategy, in which case we are forced to pay tax dollars to to buy cases against and persecute sellers."
Once again, the whole idea of fixing artificially high prices in order to gain more profit at the expense of the economy is antithetical to capitalism.
"you might also consider that if you just dont buy the memory at the high price they would make no profits and probably lower the price. and that would not even require government manipulation of the market."
No, because there is always a baseline of demand. They will always make more money overcharging the baseline than maximizing sales under this scheme.
I notice you didn't attack any of my three points on the subject of how Trusts are harmful to a capitalistic society. Why don't you start by attacking those. Also, what's you're address? I'm going to send you a book called, "Introduction to Modern Microeconomics." It'll help you out quite a bit, because the book, unlike you, was written by well informed economists who actually understand what they're talking about.
Why do I think discussing "Pure Competition Markets", equilbrium prices and zero economic profit would be a waste in this thread? :)
RAM is essential to today's business place. It's about as important as gas is. Without RAM we don't have computers. Samsung told companies, like intel, that they could sell it for x price and when intel agreed they jacked up prices to 4*x. This lost Rambus the deal with intel. This is exactly the same practice of Standard Oil did. They would move into a market and set prices low to drive away competition and them hike them up. They are trying to create a monopoly by altering their prices to undermine other businiesses and that is illegal.
if i own item x, it is my right to sell it or not sell it for whatever price i choose. the item is mine, not yours. you are not entitled to an of my things for the price you or the government deems to be fair.
i know you are gonna scream "me wanty!" and try to use the government to take things from others because you want to get your way. but that doesnt make it smart or right.
it is this simple: if something is too expensive, dont buy it.
Martin -
Price fixing is fraud. It artificially inflates prices over market value. So everyone buying at that price has been a victim of fraud.
One of the only true, original mandates of the Federal government, above national defense, was to facilitate and regulate commerce. So this isn't a case of people wanting the government to take care of them, it is a case of the government doing the job they were set up to do. And before you make assumptions, I am as close to a Libertarian was you can be, without carrying a card (we differ on a few key issues.)
You seem to believe that you can make a product and are free to sell it at any price you want. You can, as long as you do not committ fraud in order to do so. If you sell me a rock for $1,000 and tell me it is a rock, then everything is cool. If you sell me a rock for $1,000 and tell me it is a diamond, then you committed fraud. That is not legal.
Artifically manipulating the free market system is fraudulant. I am not going to go deep into why that is, and why that is a good thing for you and how you would not like it if that wasn't true.
But just keep in mind that price fixing is fraud. And it is a good thing the government is not taking it lightly.
Martin, you are correct to some point in #37. You can charge as a high a price as you want, but if it's too high, consumers will buy your competitor's product. The difference is when competitors collude to all raise price their prices and eliminate a viable alternative for the consumer.
"if i own item x, it is my right to sell it or not sell it for whatever price i choose. the item is mine, not yours. you are not entitled to an of my things for the price you or the government deems to be fair."
Yet again, the government isn't the one setting the price. The government is allowing the market to set the price, rather than companies conspiring to create a price which is far above the market price.
there is nothing fraudulent about selling an item for a high price for whatever reason. isnt it just assumed that sellers want profits and want to sell things for as much profit as possible?
i am not being defrauded when i buy something for more than it is worth. because i voluntarily bought it, i have proven that it is worth it to me.
you people continue to act like you are forced to buy things. you are not.
i could never be defrauded if i voluntary purchased an item, and the item was not fake or defective or whatever. if things cost too much, i dont buy them.
do you guys just mindlessly purchase items? cant you tell when something is too expensive and you cannot afford it? do you need the government to protect you from choosing to buy things?
Martin, have you ever purchased gasoline? Can you imagine if ExxonMobile, Shell, BP, and every other gas company agreed to raise prices? Not just by 50 cents either. What if they all agreed to charge $40 per gallon.
You must realize that gas is essential. It effects consumer who don't own cars. Even plastics companies would have to raise their prices, since they use oil in production process. Soon Tupperware would cost 4x what it used to. No one consumer must buy gas, but they would be losing money to higher secondary business costs. (Secondary like Tupperware: not directly oil, but related).
Without price fixing laws, this could happen tomorrow. And with the subsequent economic collapse, you would be begging the government to step in.
i've explained it the best i can. i think the whole concept is lost on martin
I would agree. My only suggestion to martin is that if he wants to live in a world there only companies that are already successful continue to succeed, and products cost too much for a normal wage earner to be able to effectivly handle, he should go work a labor job in some second or third world country.
that would be awesome if the gas companies did that, because the capital influx into alternative fuel R&D would be huge, and we would all be driving hybrids or biodiesel or whatever really quickly. short term it might suck, but long term it would be great for a myriad of reasons, environmental, geopolitical and otherwise.
but the gas companies realize this, and they do not want to lose market share, so they dont raise prices to 40$ a gallon, because they would permantly lose customers. if we allow sellers to set their own prices, buyers will find solutions if the prices go too high.
in fact wired magazine has a cover story on this very subject right now, favoring freedom in pricing for oil companies.
plus, government cielings on prices dissuades new investors from entering markets because they realize that if they make x profits, the socialist squadron will crush them with a zillion dollar lawsuit.
thats the way the free market works. as long as we are allowed choice, without government interference, the market conforms to provide.
you manage your life, i will manage mine. if i dont want to buy something i will not. dont take my tax money for your lawsuits.
stop the lie of pretending you are forced to buy things. you are not. simply do not buy products you can not afford. trust me, when nobody is buying, prices will come down. but thats the thing, we can and do afford these things in these examples oil and RAM). there is no real problem here, save for your whining.
the government is supposed to keep you free and safe, not force people to sell you their RAM at your price. it is not your RAM, it is theirs. they should not have to sell you anything at any price if they dont want to. yunno, freedom.
martin, are you even old enough to make enough money to pay taxes? by your argument, i would have guessed not. i was seriously starting to think we're arguing with a 10-year-old. really, give it up.
your logic is intrinsically flawed... "don't take my tax money so monopolistic companies can raise prices and take my money!"
and you say, "don't buy their products." do you like that computer you're using to post? oh, you got the one without ram...
the difference i am forced to pay taxes, but i dont have to buy ram. the the key to the FREE market. between buyers, seller and the government, only one has the power to force people to do things.
if i dont buy ram, the prices will go down. my freedom to not buy ram when it is too expensive is what keep things in check. but ram actually was always affordable, as was proven by the fact that it continued to sell. you guys just wanted an excuse to take things that arent yours.
"that would be awesome if the gas companies did that, because the capital influx into alternative fuel R&D would be huge, and we would all be driving hybrids or biodiesel or whatever really quickly. short term it might suck, but long term it would be great for a myriad of reasons, environmental, geopolitical and otherwise."
Yeah, because that's exactly what happened with OPEC.
"plus, government cielings on prices dissuades new investors from entering markets because they realize that if they make x profits, the socialist squadron will crush them with a zillion dollar lawsuit."
THIS IS NOT A GOVERNMENT CEALING! it's the government forcing a company to operate in a free market, rather than a colluded one.
"stop the lie of pretending you are forced to buy things. you are not. simply do not buy products you can not afford. trust me, when nobody is buying, prices will come down. but thats the thing, we can and do afford these things in these examples oil and RAM). there is no real problem here, save for your whining."
You're an idiot. It's not that we can't afford the products under the current setup, however Trusts force market stagnation, and make it so that an economy cannot work at maximum efficiency. how many times do I have to say this? Not to mention that this very idea is emperically denied. Read about the United States economy starting in 1900. Prices didn't magically change because of the government not intervening. In fact, the government not intervening is the reason companies like Standard Oil were able to routenly abuse competitors, employees, and consumers.
"he government is supposed to keep you free and safe, not force people to sell you their RAM at your price."
again, not "our price" whatever that is supposed to mean. the "market price" which is determined by supply and demand, rather than all of the companies getting together and deciding to make a product more expensive to gouge consumers and then lock out new competitors.
the government forcing a company to operate in a free market is a contradiction in terms.
a free market doesnt involve anyone being forced to do anything except honor their contracts and not steal from each other.
you say:
"again, not "our price" whatever that is supposed to mean. the "market price"
the market price is what is agreed upon by the sellers and buyers. if people are agreeing to buy item x at price y, then y is the market price. the government should never determine the appropriate price.
the problem is people always want free money and they like to sue. they cannot handle the responsibility of the freedom to buy or not buy things.
what you want done to samsung is effectively the same as stealing. they sold items which were volutarily purchased. but people dont like that, they want to to take things from other people against their will.
i hope in the future people will realize they are not owed anything. if items are out of their price range, that does not justify a court case to steal money from the seller.
"the government forcing a company to operate in a free market is a contradiction in terms."
That is actually true, possibly the only thing you've been correct on, in fact.
"a free market doesnt involve anyone being forced to do anything except honor their contracts and not steal from each other."
Nope, a free market is a market that is determined by supply and demand. A Trust is not a part of a free market any more than government intervention is. Now, you are correct in asserting that government intervention is not a perfectly free market. However, it more closely resembles a free market than a market under the control of a trust. Similar to Hobbes's concept of a social contract, certain rights must be given up to assure that more rights are obtained.
"the market price is what is agreed upon by the sellers and buyers."
no a market price is the price determined by supply and demand. anything above that price is an artificially inflated price. Of course I've said this already.
"what you want done to samsung is effectively the same as stealing. they sold items which were volutarily purchased. but people dont like that, they want to to take things from other people against their will."
No, Samsung is the one who's stealing, but the victim isn't just consumers who have been cribbed into an artificially inflated price. The economy is also the victim. Business entries into the economy are the victim. You are suggesting that Samsung should be allowed to profit at the expense of all other companies who are not in the trust, at the expense of the economy, and at the expense of the consumer. Samsung does not have that right.
"i hope in the future people will realize they are not owed anything. if items are out of their price range, that does not justify a court case to steal money from the seller."
I hope in the future you read a microeconomics book, because then you might learn something. now that would be shocking.