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DRAM market begins to rebound

Posted: 05 Jun 2013 ?? ?Print Version ?Bookmark and Share

Keywords:DRAM? NAND Flash? LPDDR3? DDR4? EUV technology?

PC DRAM is in for a comeback. After two straight years of financial losses and declining output value, prices for PC DRAM for 2013 is seen to rebound, according to market research firm TrendForce.

The prices of mainstream products such as 4GB modules rose by nearly 60 per cent. This helped ease the declining ASP of both server and mobile DRAM. Even with the limited annual supply bit growth, there is a chance for total DRAM revenue to grow by at least 30 per cent this year, TrendForce said.

The market prospects look bright for NAND Flash as mobile product sales continue its upward trend and as increasingly more and more structural transitions take place within the industry. As demand continues to grow at respectable rates and the ASP decline slows down, the 2013 industry value is expected to increase by an estimated 27.2 per cent YoY (ending at approximately $25.7 billion). Demand bit growth, on the other hand, is expected to rise up to as high as 48.8 per cent YoY.

DRAM ASP trend

Figure 1: DRAM market ASP trend and revenue forecast
Source: DRAMeXchange, May 2013

DRAM recovery to continue through 2014, Samsung retains lead
The aforementioned structural changes and transitions are expected to continue within the DRAM industry throughout 2013. Due to the supply-demand shifts and rising sales prices, the industry's output values have taken a turn for the better and are slowly recovering. DRAM vendors, in responding to the rapid growth of cloud computing services and the popularity of mobile products, have begun to not only initiate various merging and restructuring processes, but are also intensifying the efforts to switch to the more profitable product lines. As the diversification among the DRAM products grows, the differences in the profits experienced by manufacturers are expected to become more and more apparent. TrendForce has suggested that since DRAM vendors are unwilling to rely solely on making PC-based consumer products, DRAM demand bit growth will decline on a gradual basis in the coming periods. Facing such a scenario, the manufacturers' attitude towards capital investments has become more conservative. Other than the migration process investments, there do not appear to be any plans to develop new manufacturing capacity.

In considering the technological limits reached by the manufacturing processes, it is predicted that the 2xnm process will become the mainstream in 2014. In the subsequent periods, profits will be determined by high-value added products such as LPDDR3 or DDR4 and the next generation stacking IC technologies (ie. 3D-IC, TSV). Traditional products aimed at increasing supply bit growth will end up being of secondary importance. Given the increasing difficulties involved in advancing to the new manufacturing processesand assuming that Extreme ultraviolet lithography (EUV) technology is not formally adoptedthe DRAM industry's steady growth can be reasonably expected to continue. The dramatic price fluctuations that traditionally characterized the DRAM market, all in all, can be said to have officially come to the end.


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