DRAM market remains unstable amid weak demand

By on August 22, 2011, 3:41 PM

As industry insiders predicted less than a month ago, DRAM prices have continued descending through August and the market is still surrounded by uncertainty for the remainder of 2011. According to DigiTimes' contacts, DRAM chip suppliers are struggling to combat increasingly thin profit margins as they cut prices to encourage sales.

Spot quotes for 2Gb DDR3 parts have dipped to less than $1 with eTT chips of the same density nearing $0.70 -- not far off from the price of 1Gb chips last month. In July, 1Gb and 2Gb chips were set at $0.75 and $1.59.

The decline is largely attributed to an oversupply of DRAM, as memory production is said to be outpacing the growth rate of PC sales and server deployments. Although major players are taking a hit by lowering prices, it's the only way to remain relevant in the short term.

To address that issue, companies will have to focus on decreasing operating costs and improving production efficiencies. For instance, Samsung (and presumably others) have accelerated their transition to smaller chip fabrications (20nm in Samsung's case) to reduce production costs.

Naturally, DRAM packaging and testing firms are also feeling the heat. In a separate report, DigiTimes notes that Siliconware Precision Industries (SPIL) has exited the business and has sold its production equipment used to package and test DRAM products. ChipMOS Technologies purchased SPIL's facilities but claims it will reduce its reliance on the DRAM market.

Likewise, Advanced Semiconductor Engineering (ASE) will scale back its operations and is mulling the possibility of merging with its parent company if the market doesn't rebound.




User Comments: 6

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Tanstar said:

Seems like this article could use some links to cheap RAM. Here's one:

[link]

Tomorrow_Rains said:

I still dont understand why older ram is more expensive.

blimp01 said:

I wish these prices would affect the corsair dominator ram, I would love to see some 2133 MHz sticks for like 25 bucks

MrAnderson said:

One thing that may contribute to low demand is how Motherboard manufacturers limit the max memory now that a Windows 64bit OS holds more or less 50% of the market.

Give us more slots and raise the memory max for cheaper motherboards. They don't advertise the benefits of having more memory... The free lunch is over - Tech people are buying up ram, but that is not enough since you are floading the market. We cannot keep up. I'm still on DDR2 and I have several machines. Only if I buy something new will I be upgrading. You got to advertise to the mainstream. Intel is doing it with their processors... educate people about memory. And make it less confusing.

monkeychef23 monkeychef23 said:

I do want to point out that the 8gb Ripjaws that I purchased during black friday sales were around $50 on sale. Now there normal price is below what I paid. OMG!

fpsgamerJR62 said:

I have my eye on the Corsair Vengeance 16GB LP DDR3-1600 kit for my next upgrade. I'm hoping for some more price drops in their excellent line although the prices at present are already very reasonable.

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