Only a few years ago the NAND flash memory market was waiting for the laptop market to embrace the technology and shift from solid state hard drives to fuel growth in the sector. That didn’t happen but instead the Apple iPad came to the rescue and according to market research firm, IHS iSuppli the NAND flash market is set to soar in 2011.
IHS iSuppli noted that the NAND flash market grew 38% in 2010, reaching US$18.7 billion in revenue. In 2011, revenue is expected to climb to US$22 billion as demand for the tablet form factor continues to gain traction. Apple believes it is responsible for 17 million tablet sales in 2010 alone.
Indeed, Apple's iPad represented nearly 90% of the media tablets shipped worldwide in the third quarter of last year, according to IDC figures.
“Buoyed by the success of Apple Inc.’s iPad, NAND flash will likely enjoy explosive growth in 2011 with the arrival of tablet products from other players such as Samsung Electronics Co. Ltd., Dell Inc. and Research In Motion Ltd.,” said Michael Yang, senior analyst for memory and storage at IHS.
However, Yang warned of certain developments looming for the NAND market. He cited demand in the traditional markets for this type of memory such as USB flash drives and bundled microSD memory cards would decline over the coming years.
A fear of manufacturing overcapacity has also resurfaced and could impact the market by the end of 2011. A slight downturn is now predicted for 2012, after which the market is expected to recover by 11% in 2013 and then return to growth.
The market research firm noted that NAND bit growth is projected to rise by 72% in 2011 to 19.3 billion gigabytes, while major manufacturers were migrating to the 2x-nm nodes, which is expected to help drive supply well ahead of demand.
Major capital investments in new fabs and capacity expansions are already underway in the NAND sector.