Thursday, October 30, 2014

Samsung DDR4.jpg

Samsung Electronics' DDR4 DRAM.
Samsung Electronics' DDR4 DRAM.
12 March 2014

Computer memory prices are showing a downward trend, as supply exceeds demand. The industry predicts that the trend will continue in the first quarter of this year.

According to semiconductor e-commerce site DRAMeXchange on March 10, the DRAM spot price for flagship product DDR3 256Mb (1333MHz) was US$2.28 as of March 7, a 1.34 percent drop from the previous day. Compared to the figure for Feb. 28 (US$2.528), the price decreased by 9.8 percent within a week. 

In fact, the DRAM spot price has continued to drop since late Feb. On March 3, the price was US$2.458, a 2.77 percent decline. Computer memory prices in the spot market fell for the 6th day in a row, as evidenced by US$22.595 (-2.56 percent) on March 4, US$22.369 (-1.09 percent) on March 5, and US$22.311 (-2.45 percent) on March 6.

Market research analysts predict that the downward trend in DRAM prices will continue for the time being. DRAMeXchange said that the average sale price of computer memory in Q1 2014 is expected to edge down 10 percent compared to the same period last year, as long as there is no decisive factor in supply. DRAM prices are more likely to continue to inch down until mid-Q3 2014. 

Experts are forecasting that specific manufacturers will intensify their market share due to the decrease in price. In particular, Samsung Electronics’ influence is projected to be much bigger when it begins to mass-produce 20-nanometer NAND flash memory chips, which is 40 percent higher in production efficiency than 25-nanometer-class DRAM. 

Observers say that Samsung’s mass production of 20 nm DRAM is going to be a crucial factor in a reduction in DRAM prices, stemming from an increase in supply. Therefore, a decrease in market share of SK Hynix and Micron, which have been benefiting greatly by following Samsung’s move, seems inevitable in the long term. 

Regardless, three major companies such as Samsung Electronics, SK Hynix, and Micron are likely to continue to dominate the DRAM market for the time being. 

Lee Se-cheol, an analyst at Woori Investment & Securities, said, “DRAM is mainly produced by Samsung Electronics, SK Hynix, and Micron. So, I think that they will keep thriving.”

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