skeeter, the relevant point is that while demand for buggy whips is lower than it used to be, there is still demand, and if you are going to continue to sell buggy whips, you need to make money doing it.
Applying this to DRAM, there is still demand for older products, and while this demand will decline over time, it will continue for a long time. By doing one last shrink at 16mb, MU becomes the low cost producer of this particular product, and can make money selling it. Other DRAM makers will presumably discontinue it unless they choose to do another shrink as well, which will mean that MU will be the last maker at 16mb, and will make a profit selling whatever 16mb chips are still in demand. Yes, the profit will be small, and will shrink with time, but you take profit where you find it.
This appears to be a perfectly logical decision to me, and is in keeping with their past behavior. I believe that they were the final makers at 4mb, 1mb, and even at 256kb, and continued to milk profit out of these chips after others had abandoned them.
Carl |
