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Ultrabooks to benefit global NAND flash market

Posted: 24 Apr 2012 ?? ?Print Version ?Bookmark and Share

Keywords:NAND flash market? tablet? smartphone?

IHS Inc. has predicted that the NAND flash memory market will reach eight percent growth this year because of major sales drivers such as solid-state-drive (SSD) equipped ultrabooks. Global NAND flash revenue this year is projected to reach $22.9 billion, up from $21.2 billion last year. And with NAND flash consumption increasing in the three principal markets for smartphones, tablets and SSDs in ultrabooks, NAND revenue will climb continually during the next few years, hitting nearly $30.9 billion by 2016, added the market research firm.

The NAND industry finished 2011 somewhat below industry expectations, mainly because consumers did not embrace tablets as enthusiastically during Q4 as initially expected. While the iPad from Apple Inc. is a major achievement, the same level of success has not been shared by other manufacturers' tablets.

"Given the lukewarm performance of the tablet segment last year, there was some trepidation coming into 2012 for the NAND industry," stated Michael Yang, senior principal analyst for memory & storage at IHS. "But even though most NAND manufacturers had planned to be on the fast track in 2012 to increase production at newly built fabs, each supplier has since reduced capital spending compared to its original plans, electing to moderate supply expansions to allow demand to catch up. Such a strategy will avoid a precipitous price decline that the industry won't be able to withstand, leading to more optimism for a stronger 2012."

NAND flash revenue forecast

According to IHS, NAND flash memory market is expected to achieve eight percent growth this year because of major sales drivers such as solid-state-drive equipped ultrabooks.

Ultrabooks, a boon for NAND industry
The shining new hope for the NAND industry this year could well be the ultrabook. NAND flash suppliers have been pushing for the adoption of SSDs in ultrabooks.

With their light weight, long battery life and fast boot-up times, ultrabooks will appeal to corporations and consumers alike. This will push total NAND consumption in the PC segment to more than 15 percent of total NAND flash supply. SSDs will account for some 3.3 billion gigabytes of NAND flash consumption this year, up from 1.7 billion gigabytes last year.

Another area of growth that the NAND industry can rely on this year is the cellphone market, particularly in the smartphone segment. Smartphone shipments this year will hit 626 million units, with an average NAND flash content of 9GB per unit. By 2016, NAND memory content in smartphones will amount to 18.9GB, representing 16 percent of total NAND bit shipments. Overall NAND flash consumption this year for smartphones is forecast to reach 5.7 billion gigabytes, up from 3.1 billion gigabytes last year.

While smartphone demand has exceeded NAND industry expectations, tablets have generally underperformed.

The greatest success besides the iPad has been achieved by lower-end tablets such as the Kindle Fire from Amazon. However, the Fire comes with only 8GB of NAND flash, compared to the iPad's maximum 64GB of storage. This is resulting in overall lower consumption of NAND flash than if competitive tablets had similar NAND densities to the iPad.

Even so, tablets will be responsible for 12 percent of NAND flash bit shipments this year, with NAND flash consumption in tablets reaching 3.6 billion gigabytes, up from 1.6 gigabytes last year.

On its own, Apple will consume about 25 percent of the overall NAND supply this year, equivalent to some eight billion gigabytes. The iPad will be responsible for 74 percent of NAND consumption in the tablet segment this year, accounting for 2.8 billion gigabytes out of a total 3.8 billion gigabytes in tablets.

The iPhone, with an average density that is more than two times that of other smartphones, will consume more than 3.2 billion gigabytes.

Other Apple products that will use NAND flash in significant quantities are the Mac Book Air and iPod Touch.

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