Friday, May 12, 2006

The Dark Side of Price Fixing

While at dinner last night (I am actually in Taiwan right now), someone brought up a little fact that I didn't realize, even though I work in the high tech industry: about a dozen guys served jail time for price fixing the DRAM market:

In late March, three executives from Samsung Electronics Company Ltd., the world’s largest manufacturer of DRAM, agreed to plead guilty and serve jail time in the United States. In early March, four Korean executives from Hynix agreed to plead guilty and to serve jail time in the United States for participating in a global conspiracy to fix DRAM prices. And in December 2005, four executives at Infineon pled guilty and faced jail time.

But this isn't the entire story. It wasn't just for price fixing, it was also for colluding to keep a new product - Rambus - off the market.

We all sat there chewing our meal, wondering if these guys were caught up in the rulings as a part of their normal business dealings, especially since all these guys were non-Americans and may have normally operated under different business principles.

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