• PC World
• »Components

If you forgot to buy memory for your PC when prices were dirt cheap, you may want to shop now for some ginkgo biloba along with additional RAM. Prices are rising fast, even tripling in some cases, but they're still cheaper than a few years ago.

Major manufacturers of memory for PCs are steadily increasing the price of their DRAM chips. Now, the hike is passing to consumers, who are seeing the cost of popular SDRAM and other flavors of memory modules jump by as much as 100 percent.

The increases follow a memory price freefall that consumers have enjoyed for most of the past 18 months. But the market indicates the party is over, and prices are now heading the opposite direction.

Recent Jumps

Prices have already risen significantly over the last three months. For example, direct memory vendor Crucial sold 128MB of PC-133 DIMM memory to end users for $15.23 last October. Last week, Crucial offered the same product for $31.88--more than twice the price. Crucial's 256MB SDRAM product sold for $29.37 a year ago; now it is priced at $56.80--almost twice as much.

A survey of Web retailers reveals prices for a module of 128MB PC-133 have shot up as high as $45.99 in some cases. That's over three times as high as Crucial's $15.23 lowest price.

Analysts say still higher prices are on the way. They warn of hikes for not only SDRAM, but DDR-SDRAM and RDRAM. Besides higher retail prices, consumers can expect standard PC configurations sold by major manufacturers to have less memory than came in recent offerings.

The good news for consumers is that DRAM prices are still relatively low compared with two years ago, when 128MB of DRAM sold for a whopping $140.

Consumers are already feeling the effects of price increases by major memory module makers. For example, Samsung Electronics last week raised by 30 percent its prices to module makers that in turn sell to PC vendors. Another manufacturer, Hynix Semiconductor, on January 3 raised prices of its memory modules by 30 percent. That followed two price hikes by Hynix in December.

Brace Yourself

Price increases by major memory makers have had a domino effect, says Sherry Garber, senior vice president of memory market research firm Semico.

"Everyone is raising their price of memory," Garber says. Semico forecasts that prices will rise again in the second half of 2002.

For these and future price hikes, you can partly blame industry consolidation and stronger-than-expected PC sales this holiday season.

For example, Micron Technology, the biggest U.S. memory manufacturer, is finalizing its purchase of Toshiba's DRAM memory-manufacturing business and chip-making plant. Micron is also a likely candidate to purchase South Korea's Hynix Semiconductor, one of the largest DRAM makers.

"Fewer manufacturers equal higher prices," analyst Garber says.

Also, PC sales have been up since November, according to research firm IDC. "We're seeing significantly stronger growth in consumer PC sales than what we originally anticipated," says Alan Promisel, PC analyst with IDC.

When PC sales dropped off last year, vendors required less memory. However, memory makers continued to pump out chips. Soon, the supply of memory was out of balance with what the industry actually needed. To dump the excess, memory sellers dropped prices dramatically.

This trend is now in reverse, says Steve Cullen, director of semiconductor research at Cahners In-Stat Group. Vendors have sold off their excess DRAM inventories, and new DRAM orders are being met with higher prices.

"What's good for chip makers is not always good for consumers," Cullen says. "If I was in the market for more memory, I'd buy it this weekend." Retail prices should be lower than Web prices, he notes; that's because brick-and-mortar stores can't react to price fluctuations as quickly as nimble Web retailers.

DRAM Price du Jour

The sooner vendors and makers of memory-associated products feel the hit, the sooner price changes ripple to consumers. Already, prices have tripled for memory module maker Kingston Technology, says Steve Rodriguez, Kingston's director of strategic marketing.

"It's only a matter of time before consumers start to feel price bumps," he says.

But during the transition, a wide disparity of prices is already apparent. A cursory review of prices at Web retailers and at retail stores reveals a huge swing in current pricing.

In mid-January, a Micro Center computer superstore located outside Boston is selling a 128MB DIMM of PC-133 memory priced at $24.99. The online store PC Connection is simultaneously selling the same product priced from $34.95 to $45.95. For the same module, Web retailer PC Nation's price is $46.49.

In a volatile computer memory market, nothing is certain, says Kim Myung Ho, senior manager for technical marketing at Samsung Electronics.

As the experts advise, you may want to shop around now and beef up your PC's memory while RAM while memory is relatively cheap. Don't forget!

• See more like this:
• memory,
• DRAM,
• price,
• cost,
• shop,
• Crucial,
• Samsung,
• Hynix,
• Semico,
• Micron Cahners,
• Kinston