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DDR3 2Gb contract price stabilizes

Posted: 30 Sep 2011 ?? ?Print Version ?Bookmark and Share

Keywords:DDR3 DRAM? contract price? spot market?

According to DRAMeXchange, a research unit of TrendForce Corp, the ASP of DDR3 1333Mhz 2Gb chips climbed by about 9.1 percent from $1.1 to $1.2, while DDR3 2Gb eTT chips saw a higher increase at 17 percent, settling at $1.1. The status of the spot market has affected contract price negotiations for 2HSept. DDR3 2Gb contract price stayed at $10.50 while DDR3 4Gb plunged below $20, decreasing by 4.88 percent to $19.50. This is due to DRAM makers' actively pushing this density to mainstream.

From a market perspective, since contract price showed signs of stabilization in 1HSept., the spot market looks as if it the downward trend has nearly bottomed out. Thus, buyers are eager to buy. Furthermore, with increased demand from China's upcoming October 1 National Day, the spot market is seeing a fresh wave of inventory replenishment, resulting in a nearly 20 percent increase in spot chip price. As for contract price, affected by the invigorated spot market, PC OEMs' relatively low inventory levels, and inventory replenishment in September, DRAM makers kept price quotes flat. TrendForce expects notebook content per box to gradually increase, arriving at 3.7Gb per unit in Q4, a 5.8 percent QoQ increase. As the market remains in a state of oversupply, whether or not DRAM price will continue to have such momentum will depend on future market demand.

Ultrabooks and Cloud Applications
While DDR3 2Gb chips are the DRAM market mainstream this year, with the rise of ultrabooks and cloud applications next year, DRAM makers are expecting strong demand for DDR3 4Gb and have accelerated the transition to the higher density chips. From a product perspective, 11in and 13in ultrabook models have a thickness requirement of 18 to 21mm. Thus, due to space limitations, makers must shift from SODIMM to on-board modules, and 2Gb chips must be abandoned for 4Gb chips.

As PC OEMs are all focusing on ultrabook products for 2012, demand for 4Gb chips will rise. As for cloud applications, although server shipment estimates show steady growth, it has an opportunity to experience remarkable growth due to increased demand. RDIMM specifications will gradually transition to 32Gb or higher, from the current 8Gb and 16Gb mainstream. Demand for 4Gb chips is even stronger from the server market, and as server DRAM products are more profitable, makers are all fighting to gain footing.

As for DRAM manufacturers' DDR3 4Gb development schedules, Korean makers are leading the pack. Samsung began mass production in Q2 and Hynix plans to do so at the end of Q4. Since Korean manufacturers have more than 60 percent market share in the server segment, early DDR3 4Gb chips will be mainly shipped. Chips for ultrabooks are in the qualification stage. With regard to Japanese makers, Elpida has aggressive ultrabook supply plans, and some models use Elpida's DDR3 4Gb chips. Furthermore, as subsidiary Rexchip will enter DDR3 4Gb mass production in Q4, the Japanese team's capacity will increase significantly in 1H12.

Micron has shown steady growth on the server market. The 30nm node process is in the testing phase and expected to begin mass production in 1H12. Nanya and Winbond are on the same schedule as Micron. As all DRAM makers are eagerly transitioning to DDR3 4Gb production, TrendForce expects the higher density chip to become the mainstream specification in 2H12. However, the rate at which manufacturers make the switch and the quality of their chips are key factors that will determine makers' profitability.





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