Cloud Firms Seek Decade-Long Memory Supply Deals
Major Chinese cloud providers are negotiating 10-year DRAM agreements to guarantee AI server capacity through 2035.
Updated on Oct. 27, 2026 in Data Centers
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Alibaba, Tencent, and ByteDance are negotiating extended DRAM supply agreements with Samsung Electronics and SK hynix. These discussions represent a significant shift toward decade-long supply commitments for server memory to support AI infrastructure expansion.
Why it matters
The surge in demand for AI-ready server memory has tightened global supplies, forcing major cloud providers to move beyond traditional three-to-five-year procurement cycles to guarantee capacity through 2035.
The negotiations cover high-capacity server DDR and low-power LPDDR memory modules required for AI compute clusters. These agreements seek to lock in supply for the next 10 years, compared to the industry standard of three to five years.
The players
Alibaba
A major Chinese cloud provider operating extensive data center infrastructure for AI and enterprise services.
Tencent
A Chinese technology conglomerate and cloud service provider expanding its AI compute capabilities.
ByteDance
A technology company managing significant cloud computing requirements for its global social media platforms.
Samsung Electronics
A leading global manufacturer of DRAM and LPDDR memory chips essential for server infrastructure.
SK hynix
A major South Korean semiconductor producer specializing in high-performance memory solutions for data centers.
The details
Cloud providers are securing capacity by reserving memory production lines directly with semiconductor manufacturers. This strategy involves paying a premium to guarantee access to high-performance memory modules as AI server demand puts pressure on existing production throughput. These long-term agreements mirror strategies previously adopted by large U.S. technology firms to mitigate volatility in the memory market.
Timeline
2035 is the requested end date for the new supply agreements.
The Tech Race
Chinese cloud providers are mirroring the long-term memory procurement strategies historically used by large U.S. technology companies to insulate their operations. This shift marks an aggressive effort to ensure hardware availability amid the global competition for AI computing capacity.
Cloud users in China may see more stable availability for advanced AI services as these firms lock in hardware capacity. These long-term contracts could limit the immediate supply of memory available to smaller companies on the open market.
The takeaway
Securing decade-long supply chains is becoming the new baseline for hyperscalers racing to build AI infrastructure. Monitor upcoming quarterly earnings calls from Samsung Electronics and SK hynix for any confirmation of these deal closures.
Further reading
For more on how infrastructure scale influences performance, explore our latest coverage in Data Centers.
Source note: This article includes information reported by TokenPost.
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