Direct Rambus DRAM module (RIMM) prices dropped last week by as much as 35%, according to a leading module manufacturer, but a gaping four- to five-fold open-market premium still hangs over the would-be successor to SDRAM.
And with double-data-rate SDRAM coming later this year at a performance level more in line with the Rambus architecture, industry purchasers say the price differential-as with virtually all commodity products-will play a large role in determining which memory will prevail in the market.
Even with the latest RIMM price cuts, Direct RDRAM module tags must drop precipitously in the months ahead if the memory interface is to pick up share against the much cheaper SDRAM devices, said Burt McComas, an analyst at InQuest Inc., Gilbert, Ariz. Even Intel Corp., one of the strongest supporters of Rambus, concedes that the initial premium has served as an early deterrent to widespread RDRAM adoption.
Rambus backers avow that as production volumes ramp, RIMM prices will fall to attractive levels.
Kingston Technology Co., Fountain Valley, Calif., last week slashed the average price of its Rambus modules by 35%. Liesl Schwoebel, Rambus product manager at Kingston, said the module supplier was able to make the cuts because its RDRAM chip supplier, Samsung Electronics Co. Ltd., had reduced its chip prices.
Schwoebel said Kingston didn't slash prices in an overt attempt to spur the Direct Rambus market. "We're simply passing along to our customers the price reductions we got on Direct Rambus parts from our suppliers," she said.
Samsung, which also sells Direct Rambus modules, did not respond to RIMM pricing inquiries by deadline. A Kingston sales bulletin last week claimed that Samsung is the only chip manufacturer delivering Rambus chips in quantity.
Kingston declined to disclose its new RIMM pricing list. However, sources told EBN the cuts were even steeper than the company had indicated. The new quantity price for a Kingston 128-Mbyte, 800-MHz ECC (error-correction-coded) Rambus RIMM is now $470, down from $780 a week earlier. The 600-MHz ECC version was reduced to $380 from $670, making for reductions in the neighborhood of 40%. Low unit sales of the same RIMMs ranged from $579 to $669.
The lower prices are in line with 128-Mbyte add-on ECC RIMMs that Dell Computer Corp. is selling for $480; non-ECC versions are priced at $380. In comparison, Dell is selling 128-Mbyte SDRAM DIMMs for $90.
The aftermarket retail street price of RIMMs also dropped last week. Pricewatch.com, an Internet market-monitoring service, showed dealers quoting 128-Mbyte RIMMs for $560 to $615, and 64-Mbyte modules for $292 to $403.
The memory buyer for an Internet RIMM dealer, Hotupgrades.com, Costa Mesa, Calif., said the company's $599 price tag for a 128-Mbyte, 712-MHz RIMM was down from nearly $1,000 only a few months ago. He attributed the drop to a larger supply of RIMMs showing up in the after-market.
RIMMs are showing up in the spot market in limited numbers-mainly from OEMs, said Paul Myers, commodity manager at American IC Exchange, Aliso Viejo, Calif. He also said the going rate for 128-Mbyte modules dropped into the $600 range when offers to sell at $800 to $1,000 got few takers. On the other hand, he said, SDRAM DIMMs are continuing to move up in price as spot-market supply becomes more limited.
The latest price cuts are part of a continuing decline as Direct RDRAM ramps up in volume production, said Avo Kanadjian, vice president of marketing at Rambus Inc. "Now that Direct Rambus supply is increasing, shipments can start to flow to the module and retail market," he said. "You can expect to see Rambus and RIMM prices come down."
As Kingston was cutting RIMM prices last week, rival module maker Smart Modular Technologies Inc., Fremont, Calif., moved to boost the adoption of the competitive DDR SDRAM. Smart Modular, with DDR chip-vendor support, set up a validation service for upcoming PC1600 and PC2100 DDR modules.
Validating modules is the last step before launching the new DDR memory, said Robert Fusco, DRAM memory manager at Hitachi Semiconductor (America) Inc., San Jose. IC makers have long been able to supply DDR chips, and DDR-enabled core-logic chipsets will be coming on the market in the next few months, according to the companies. At that point, observers agreed, the two high-performance memory architectures will enter a high-stakes shootout for market share-with Direct Rambus pricing playing a critical role.