LONDON – The second half of 2011 is shaping up to be a DRAM buyer's dream as the price for the memory component is set to go into free-fall, according to market research firm IHS.
The average selling price for the 2-Gbit DDR3 DRAM – a bellwether product – is projected to drop to $1.60 in the third quarter, down 24 percent from $2.10 in the second quarter. In 4Q11 the price could plummet another 22 percent to $1.25, close to cash costs for many manufacturers, said IHS. In the second quarter the market declined 5 percent from 1Q11.
"Contrary to typical seasonal patterns in which prices are very soft during the second quarter, that period this year saw relatively flat, unchanged DRAM pricing compared to the first quarter," said Mike Howard, principal analyst, DRAM and memory, at IHS. "The third quarter is shaping up to be pretty bloody for DRAM makers. The combination of inventory reductions by DRAM makers and more bits coming out of the fabs is resulting in a very soft pricing environment."
There could be as much as a 15.9 percent increase in shipments in the third quarter, and prices are not expected to firm up because of that, IHS said.
Right, it's because of the trendy i-devices, which are relatively DRAM-light, that have taken demand away from the traditional DRAM-heavy PC's and NB's. Not all demand, for sure, but enough for this year.
There would be a bigger concern, if at the same time, SSD demand is also dropping, for similar reasons (NB cannibalization).
Who will be next to exit memory production?...,
Two companies in Taiwan are rumored to be near making the decision. Enjoy the prices while they last because once it's considered "cheap" the as-sold memory population will grow accordingly beginning the cycle anew.
Yeah, buying memory for older technologies can be tricky. Prices drop until they stop, and then quickly they go to premium levels. It can be a 'catch the falling knife' situation if you are waiting for the lowest price.
How soon we forget that these cycles have repeated in the past, new-tech replaces slower/lower density memory or ASICs, disrupting previous architectures, and profit margins from vendors that are atill attempting to recoupe their tooling costs from previous generations colapse or get out of the market. and not forget that most OEM's have similar perils, theay are attempting to leap frog other vendors and other disrupting form-factors taking market share.
Free market forces are gand, but sure put great strain in many vendors to forecast in advance or, else suffer the pains to devalue their once premium-parts stock. You blink - you loose.
HP will sell their business just like IBM did with theirs. This in itself will not translate to any change in DRAM demand.
What will result in a change is a shift in a portion (not all) of the computing market from traditional PCs and laptops to more personal devices (or one way difficult devices as I like to call them) such as pads and phones. However, there is a potential for offset in this based on overall world market growth.
So Gordon E. Moore was right.
If the price falls I [and others] will buy more memory. In any event MS Windows 8 will be with us soon. It will be the greatest operating system ever - literally, so it will need a lot more more memory to fit in.
Join our online Radio Show on Friday 11th July starting at 2:00pm Eastern, when EETimes editor of all things fun and interesting, Max Maxfield, and embedded systems expert, Jack Ganssle, will debate as to just what is, and is not, and embedded system.