Memory

NAND Shortages Coming

Samsung will deliver less flash memories

By Alexandru Pancescu, Hardware Editor

17th of August 2007, 12:15 GMT

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After the power outage that left six of the NAND chip production lines from Samsung in shambles, financial and market analysts predicted that the entire flash memory market will suffer from a shortage of spare chips during this time period. As the Korean hardware manufacturing company quickly restored production and announced that some of the chips from the affected production lines can be salvaged, NAND users began to gain confidence in the fact that everything may

return to normal.

Well, it looks as if the initial predictions of critical NAND shortages were true after all as the general manager, Jance Lu, from Power Quotient International (better known as PQI) was cited by the news site DigiTimes saying that Samsung, world's largest computer memory and NAND chips producer, will only be able to supply its customers with 85 percent of the normally required quantity of flash chips. According to PQI's general manager, the inventories of NAND flash memory chips are being used by industrial customers and a contract price adjustment is very likely to occur sometimes during the next month.

Jance Lu predicted that the NAND flash supply will decrease by around 3 percent as components shortages become more acute and she added that PQI's own business will not be perturbed because the company has enough reserves of NAND chips from a previously order that was delivered in late July, just before the power outage incident hit Samsung's production lines from south Korea. PQI's current business is mainly based on sales derived from NAND productions or related applications which amount to almost 60 percent of the company's revenues. As the shortage of NAND chips will make flash based products and applications more expensive on the end user market, manufacturers will benefit, especially since the computer memory price trend is slowly ascending.

PQI will start operating its joint venture with TDK from October in an attempt to develop and ship solid state drives, SSDs for short, after the NAND supply situation gets better and a flash memory price correction occurs. The PQI and TDK partnership in the solid state drive market is aimed at producing drives for system integrators and other industrial clients.

TAGS:

Samsung | PQI | TDK | NAND | flash

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