Alibaba, Tencent, and ByteDance Reportedly Seek Unprecedented 10 Year Server Memory Supply Deals From Samsung and SK hynix Through 2035
KOREAN MEDIA: MAJOR CHINESE CLOUD SERVICE PROVIDERS (CSPS), INCLUDING ALIBABA, TENCENT, AND BYTEDANCE, HAVE REQUESTED LONG-TERM SUPPLY AGREEMENTS (LTAS) FOR SERVER MEMORY FROM SAMSUNG ELECTRONICS AND SK HYNIX. BEYOND THE TYPICAL THREE-TO-FIVE-YEAR TERM, SOME CUSTOMERS ARE SEEKING ULTRA-LONG-TERM CONTRACTS SECURING MEMORY SUPPLIES FOR 10 YEARS THROUGH 2035. THE REQUESTED LTAS COVER DDR5 AND LPDDR5.
Context
Requests from China's largest cloud providers to lock in DDR5 and LPDDR5 server memory through 2035 show that hyperscalers expect structural DRAM scarcity to persist for a full decade as memory makers shift wafer capacity toward high margin HBM4.
South Korean memory leaders Samsung Electronics and SK hynix have been aggressively reallocating cleanroom and wafer fabrication capacity toward high bandwidth memory, including 8 high HBM4 scheduled for mass production in the second quarter of 2027. At the same time, surging demand from agentic AI servers and physical AI systems has tightened global supply projections for conventional DDR5 and LPDDR5 DRAM.
Deep dive
On October 27, semiconductor analyst Jukan reported citing South Korean industry media that China's largest cloud service providers, including Alibaba, Tencent, and ByteDance, have approached Samsung Electronics and SK hynix to request long term supply agreements for server memory. While long term memory contracts in the data center industry typically span three to five years, some of the Chinese hyperscalers are reportedly seeking ultra long term agreements that guarantee memory allocations for 10 years running all the way through 2035.
According to the report, the requested multi year supply agreements specifically cover standard DDR5 and low power LPDDR5 server memory modules rather than restricted high bandwidth memory stacks. While US export controls restrict advanced HBM shipments to China, DDR5 and LPDDR5 remain critical for high capacity CPU host memory, Mixture of Experts parameter offloading, key value cache storage, and domestic AI accelerator clusters run by Alibaba Cloud, Tencent Cloud, and ByteDance's Volcano Engine.
The push for decade long contracts reflects growing concern among hyperscale procurement teams that Samsung and SK hynix will continue dedicating new fabrication lines and capital expenditure to HBM4 and custom AI memory for US tech giants, leaving conventional server DRAM chronically undersupplied through the late 2020s and early 2030s.
What to expect next
Samsung Electronics and SK hynix hold extraordinary pricing leverage in negotiations over multi year DDR5 and LPDDR5 server memory commitments and are unlikely to lock in fixed pricing through 2035 without substantial customer prepayments or periodic volume price escalators. Watch whether South Korean memory makers sign binding decade long allocation frameworks with Chinese cloud providers or prioritize flexible spot pricing and US hyperscale capacity.