China's National Development and Reform Commission has taken note of the surge in DRAM prices in recent months, and according to official Xu Xinyu, the organization will be keeping a close eye on the industry and its major players to guard against price fixing. Thus far, no evidence of price fixing has been found, but DRAM prices have steadily risen over the last 18 months, culminating in a total rise of over 50%. This could potentially be explained by a sharp increase in demand due to the growth of the smartphone market, especially in China, where the booming market contains a great number of players of all sizes, all of whom demand DRAM for their products. Still, even the increased demand may not be enough to explain such a fast and aggressive upshot in DRAM pricing, leaving investigators to look to price fixing as a possibility. This may also be a rebound effect from falling prices back in 2016.
Two of the top players in the world, Samsung and SK Hynix, have not yet made any official announcement regarding this news just yet. For Samsung's part, the company allegedly spoke with officials from the National Development and Reform Commission, and denied any wrongdoing. For the time being, the Commission has not found any reason to implicate any companies in particular, and is unsure exactly how it would go about obtaining the cooperation of foreign authorities, should a firm outside of China be found guilty.
For those not in the know, DRAM is an essential part of a smartphone; it's the basis of flash memory. This same type of memory is used in a wide range of other applications across the computing world. Samsung is currently the top player in the worldwide DRAM market, and routinely makes advances in the DRAM space faster than competitors. Runner-up SK Hynix is from South Korea, like Samsung, and normally nails down technological advances just a few weeks or months after Samsung does. Price fixing, meanwhile, is a practice where a group of companies get together to agree to drive up the price of a good arbitrarily. Given Samsung and SK Hynix's sheer size and role in the market, just the two of them conspiring to price fix could potentially upend prices for the whole industry, making it easy to see where Chinese regulators' suspicions are coming from.