|
NAND flash market under control for now, say market analysts |
|
|
|
Mar 26, 2007 at 12:00 AM |
 Both iSuppli and Gartner have now commented on the NAND flash market seeing improved conditions in just the last few weeks, prompting new assessments on the volatile sector.
Gartner noted in its newsletter that NAND flash spot prices for multilevel cell (MLC) devices surged almost 29 percent for 4Gb chips, while 8Gb devices climbed by 11.5 percent. The research firm cited supply concerns as the contract prices by Tier 1 suppliers had been raised, indicating a much improved supply & demand balance.
Nam Hyung Kim, director and principal analyst at iSuppli, delved a little deeper into the NAND flash dynamics, citing the continued switch by Hynix and Samsung away from NAND production to that of DRAM as the margins were better. The dominant share both Korean memory manufacturers have has meant that the over-supply in the last 6 months was now turning to a slight shortage.
"The major factor behind iSuppli's upgrade is a slowing in the growth of supply, which is helping to mitigate the severe price erosion that has been the dominant driver of market conditions over the past half year," said Nam Hyung Kim, at iSuppli. "The South Korean suppliers, Samsung Electronics Co. Ltd. and Hynix Semiconductor Inc., are decelerating their NAND production growth, leading to a more balanced supply/demand situation and firmer pricing in the market."
According to Kim, Hynix and Samsung started migrating production in the fourth quarter of 2006, and he believes this reduction in NAND supply growth is causing a significant decline of excess supply and surplus inventory in the supply chain.
Interstingly, iSuppli believes that neither memory manufacturer will convert production back to NAND while margins remain below that of DRAM, and is not expected to occur in 2007, said iSuppli. The research firm also noted that Hynix was least likely to make a switch due to the lack of 300mm fabs, which are now core to profitability in NAND flash production. This is expected to force Hynix to delay the introduction of 16Gbit parts compared to rivals Samsung and Toshiba in the second quarter.
|
News 
