Mark your calendars: Around the beginning of July, the fate of the fall launch of Direct Rambus DRAM will be determined. We'll know at this early date what the production volumes of Direct RDRAM will be when the new memory makes its predicted debut at the end of September.
At this make-or-break point in the summer, DRAM vendors must decide how fully they will commit to mass production of the next-generation memory chip.
It's just a matter of wafer production schedules. It takes 10 to 12 weeks from wafer design to final product out the door. Add extra time to put chips into memory modules and test them. If Intel Corp. is to have an ample supply of its mandated advanced DRAM on hand come September, memory fabs must start Direct RDRAM wafers on their lines in quantity three months earlier.
DRAM makers don't have an easy decision ahead of them. With the exception of Samsung, which is adding some new fab lines, all memory vendors must take away some of their existing SDRAM production lines to make the Rambus wafers. Since the Direct RDRAM chip is slightly larger than the SDRAM die, it means giving up a disproportionately larger share of silicon.
With Samsung, Micron, and Hyundai ramping conventional SDRAM output sharply, any vendor surrendering production capacity for Direct RDRAM may be forfeiting some market share in the mainstream memory market. The flip side is that the expected higher price of Direct RDRAM could offset any SDRAM revenue loss, depending on how quickly the new wideband memory chip gains popularity.
PC OEMs are providing little market-projection guidance to help DRAM makers with their production dilemma. OEMs continue to say they want a supply of Direct RDRAM chips on hand, in line with Intel's planned fall launch. Of course, they're covering their bets by also demanding assured supplies of SDRAM, especially the new PC133 versions. And with just-in-time ordering entrenched, OEMs want production delivery of any of the DRAM flavors on 24 to 48 hours' notice.
All this means that fragmentation of the DRAM market will escalate as fast as the technology-roadmap speed-up. Not many cash-pinched DRAM companies can afford the massive investments needed to maintain full production capacity for all types of memory. For some, it's becoming an either-or choice.
That's what makes the July deadline for Direct RDRAM so critical. Well in advance of the slated launch for the new memory, the market will get a clear indication of the likely sizes of competing SDRAM and Direct RDRAM arsenals as companies prepare for this fall's battle.