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TrendForce: Memory Storage Industry to See Growth Amid Increased Smartphone Demand

The memory storage industry is expected to see an overall growth in the second half of this year driven primarily by the smartphone demand. As this occurs, commodity DRAM capacity will be tight, which is expected to remain unchanged in the short term. This will bring increased demand for server as well as mobile DRAM during the second half of the year, and DRAM vendors as a result are likely to report record-high profits. In terms of the NAND Flash market, the market is expected to turn from oversupply in the first half of the year into balanced supply during the second half, as OEM and module customer demand strengthens. All of these factors will push up pricing in the industry during the second half as a result, according to DRAMeXchange, a subsidiary of the Taiwan-based market intelligence firm TrendForce.

Smartphone shipments cause DRAM supply to be tight; prices expected to rise.

Smartphone shipments in 2014 are expected to grow 29% year on year to 1.196 billion due to increased demand in China as a result of 4G TD-LTE developments, the release of the new iPhone, recovery in economies across the globe, and increased demand for entry-level and mid-range smartphones. Within that number, Chinese vendors’ shipments are expected to make up 37.3%. The Chinese vendors will mostly use the eMCP technology in their smartphones, while the new iPhone will use the LPDDR3 1GB technology. This will lead to a slight increase in mobile DRAM prices during the third quarter and will quicken the upgrade of LPDDR2 technology to LPDDR3, according to DRAMeXchange Assistant Vice President Avril Wu.

Smartphones will help balance supply for NAND Flash.

Going into the second half of 2014, smartphones will play a major role in the NAND Flash market. According to DRAMeXchange Assistant Vice President Sean Yang, most new smartphones from major smartphone vendors will be released after mid Q3 2014. OEM manufacturers meanwhile have been gathering reserves since June and the NAND flash capacity is being shifted to system products, which is putting a strain on channel customer supply. This has led to an increase in NAND Flash pricing as a result.

Full Press Release: http://press.trendforce.com/press/20140709-1470.html

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