Whether we’re talking about flash memory or several of the other varieties of DRAM, all sources indicate that the memory market is going strong. Contract prices for 32-Gb NAND flash, for example, rose by as much as 12% in the first half of April compared to the period two weeks prior, says TrendForce’s DRAMeXchange. As further proof that a rising tide floats all boats, the price jump appears to be triggered by the success of the high-density NAND flash market.
Driven by demand for mobile products like smartphones and tablets, as well as Ultrabooks, memory manufacturers have been busy ramping up 64-Gb NAND flash production—20-nm process NAND flash accounted for some 80% of the market in Q213. As vendors pull resources away from low-density NAND flash market, tightening supply has acted to push prices up—a trend poised to continue. “In spite of the lackluster demand and the conservative attitudes displayed towards the memory card and UFD markets during Q2, the 32-Gb chip prices showed noticeable growth in 1H’Apr. due to lowered production,” the report says. If you’re a consumer of low-density NAND flash, brace yourself because it’s only going to get worse before it gets better. “[We] believe that the market supply of 32-Gb products will shrink more rapidly following the reduced inventory of the low density chips made using the previous-gen processes.” At the same time, the rush to high-density production may result in oversupply situation that will create a downward pressure on pricing for 64-Gb products.
SanDisk, for one, expects to take those price increases to the bank. In a recent earnings call, the company raised its 2013 revenue target range to $5.6 billion and $5.75 billion from a previous range of $5.3 billion to $5.6 billion. They may be preparing for a high-density NAND flash glut by remaining somewhat conservative in their manufacturing mix, however. “Based on our decision to add no new wafer capacity beyond productivity improvements in 2013, we expect to be supply constrained for the remainder of the year," chief financial officer Judy Bruner said in the presentation.
Of course, the definitions of low-density and high-density NAND flash are already changing. Last fall, Samsung Electronics Co. began manufacturing 64-Gb MLC NAND flash memory using 10-nm process technology. Just a few weeks ago, however, the company announced the volume production of a 128-Gb multi-level-cell (MLC) product.
NAND flash isn’t the only memory game in town, however. Despite falling demand in the post-PC era, DRAM prices have actually risen, buoyed by the same market forces responsible for inflating the cost of low-density NAND flash. Indeed, Gartner Inc. expects the DRAM market to hit $29.6 billion in 2013, up 13% from the previous year. The mobile DRAM market should account for roughly 35% of that pie, and DRAM King Samsung is prepared—they just announced volume production of 4-Gb LPDDR3 mobile DRAM using 20-nm process technology.