SCOTTSDALE, Ariz.--Revenues in the flash memory market will exceed $3 billion in 1999 with unit shipments passing the 1 billion mark, said a new research report In-Stat Group here.
Average selling prices for flash have jumped by more than 20% this year after demand began exceeding production capacity, according to In-Stat. Unit demand also began to explode because of flash's use in cellular telephones, said analyst Jesse Huffman.
By 2003, flash revenues are expected to exceed $8 billion, which would be a compound annual growth rate of 18.3% from 1999, according to In-Stat.
"Early in the year the explosive worldwide cell phone demand set the pace for an up-side year," Huffman said. "The offshore economies began recovering, and offshore manufacturing began consuming record quantities of flash memory."
In addition to strong demand for flash from cellular phones, In-Stat believes consumer electronics will drive up revenues for the nonvolatile memory chips. Among these consumer products are digital cameras, MP3 audio players, and portable computing devices.
In-Stat said shortages of 16- and 32-megabit flash products began hitting the marketplace in the middle of 1999. Shortages of 2-Mbit memories began occurring in the second half of this year. The research group said lead times for delivery of flash chips have stretched out to as much as 16-20 weeks. The shortage is expected to continue well into next year, according to In-Stat.