DDR2 Prices Slide, Hitting PC Space

"DRAM prices sink further amid poor demand and market oversupply," read the headline.

It said that "DDR2 price(s) continued to spiral downwards," and noted that as of Monday, DDR2 512 Mb 667Hz slumped by 2.9 percent and DDR2 512Mb eTT dropped by 5.5 percent. The weak memory pricing environment can translate into a soft overall pricing landscape in the PC space, meaning that unit sales could be brisk at the expense of margin.

System builders, like David Chang, CEO of Agama Systems, Houston, have been noticing the memory pricing weakness for some time. "Memory prices are going down like crazy," Chang said Monday, even before the note from DRAMeXchange. Chang noted that the drops have been going on for a while and have worked their way into the PC supply chain.

Chang and others are at a loss to explain the soft pricing and demand environment for memory -- especially in a year in which the rollout of Microsoft Vista, with its extra hardware requirements, was supposed to spark a run on components like DDR2.