Micron part of US chip competition probe
[an interesting story that has not taken everyone by complete surprise....pb]
Micron Technologies, the US semiconductor company, caused shockwaves among European chipmakers on Wednesday with an announcement that the US Department of Justice had opened an investigation into alleged anti-competitive practices among D-Ram memory chip manufacturers.
In an announcement late on Tuesday, Micron said it had received a grand jury subpoena from the US District Court for the Northern District of California seeking information, and would cooperate fully with the investigation.
"Micron does not believe it has violated US antitrust laws" the company said. "The D-Ram business is highly competitive and subject to extreme volatility. Competitive forces in today's market have led to D-Ram prices reaching unprecedented lows."
Samsung Electronics, the world's largest producer of D-Ram chips, on Wednesday said it had received a similar subpoena to Micron.
Infineon, the German chipmaker, said it had been contacted by the Justice Department, but it was not yet clear whether the company was the subject of an investigation or merely being asked to provide information.
The probe comes after a long period of weak prices in the memory chip market, which saw spot prices of certain D-Ram chips as low as $1 last November, well below cost price of between $4.50 and $5.
Prices have since recovered, lifted in part by merger talks between Micron and Hynix Semiconductor, the loss-making South Korean chipmaker. These merger talks, however, fell through in May.
Hynix has in the past been criticised by competitors for allegedly pushing down the prices of memory chips. In October last year, Japanese chipmakers including NEC, Toshiba, Hitachi and Mitsubishi Electric threatened to ask the Japanese government to file an anti-dumping complaint against a number of foreign rivals including Hynix.
Micron's announcement came after US market close, but sent European chip stocks down on Wednesday morning. Infineon, fell more than 4.5 per cent to E15.85 in Germany while in Amsterdam, ASML Holding dropped more than 5 per cent E15.95. STMicroelectronics, Europe's largest chipmaker fell 3.5 per cent to E23.80. ARM Holdings, the UK chip designer fell nearly 8 per cent to 141p in London.
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