Kioxia warns 1TB SSDs under $50 are a thing of the past

[Alfonso Maruccia]

Facepalm: Kioxia, a company spun off from Toshiba in 2018 and credited with inventing flash memory, predicts that the memory market will be influenced by AI-related investments for at least the next two years. Worse yet, consumers can expect to pay higher prices for the same products.

Kioxia is working to significantly enhance storage performance for AI workloads in the enterprise market. Unfortunately for individual consumers, that same focus is driving up prices for traditional storage products.

Shunsuke Nakato, managing director of Kioxia's memory division, recently confirmed that the company's NAND Flash output for this year is already sold out. Speaking at an event in Seoul, Nakato discussed the current "supercycle" of AI-driven spending, which he expects to continue at least through 2027.

For consumers, the biggest impact of the AI boom is the disappearance of affordable SSDs. Nakato reportedly believes that the era of 1TB flash drives costing less than $50 is over. The memory industry is no longer prioritizing affordability, as enterprise demand is straining the NAND supply chain and reshaping the market.

Kioxia's executive said the memory industry is now singularly focused on AI, driven more by hype than practical utility. Organizations are discovering that AI delivers limited value in many corporate environments, yet investment continues unabated, fueled by unprecedented FOMO.

Big Tech and high-profile AI startups, including OpenAI, are reserving ever-increasing amounts of chip production, leaving Kioxia facing the same supply challenges confronting other memory manufacturers. Nakato explained that the company cannot simply ramp up output to meet the growing orders.

To manage demand, Kioxia is negotiating with long-term partners to allocate its annual chip production, rather than prioritizing the highest bidder. In some cases, supply has increased slightly, Nakato said, but prices have risen as much as 30 percent.

Looking ahead, Kioxia expects its business to expand significantly in the coming months and years, with price increases likely playing a major role. Memory manufacturers are effectively setting their own prices, while Big Tech companies scramble to secure every available chip to power ambitious AI data center projects.

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Kioxia warns 1TB SSDs under $50 are a thing of the past

 

[acrossthestars]

Kioxia's executive said the memory industry is now singularly focused on AI, driven more by hype than practical utility.

What happens when the tech industry finally has a lucid moment, after years of getting drunk on AI hype and exponential stock gains? They know that the market doesn't want their product, but they're going full speed ahead anyway.

How bad is this hangover going to be?

 

[Thatsdisgusting]

Remember this statement when somebody comes up - "yay, toshiba make kioxia, so new, much speed, kick monopolist samsung, go buy much kioxia!"

 

[yRaz]

What happens when the tech industry finally has a lucid moment, after years of getting drunk on AI hype and exponential stock gains? How bad is this hangover going to be?

my interpretation of what's going on with memory companies is that they aren't willing to expand production capacity to compensate for AI because these high prices are going to be short lived. If Micro, Samsung, ect., thought that this trend would continue, they would HAPPILY increase production for this hype train. I see their actions as saying "we're gonna make money on this now, but we aren't going to invest billions only for demand to fall off in a year or two."

These are professional money makers, they have a legal obligation to do what is best for their shareholders. It is their current belief that selling the majority of their production to AI while not expanding their capacity to compensate for shortages is in the best interest of their shareholders as that would make ram prices PLUMMET after AI demand falls off.

 

[poshflamingos]

What happens when the tech industry finally has a lucid moment, after years of getting drunk on AI hype and exponential stock gains? They know that the market doesn't want their product, but they're going full speed ahead anyway.

How bad is this hangover going to be?

Same as the dotcom bubble. They know only a fraction of existing AI companies will survive, but if you bet on the few ones that survive you win big. The rest will be wiped out, along with all the money invested in them. It's just VC making risky bets, dreaming of a second opportunity to get lucky bet on a new equivalent to dotcom Google/Amazon/eBay/etc.

 

[WhiteLeaff]

S-C-A-M.

 

[NumberNine]

Worse yet, consumers can expect to pay higher prices for the same products.

Brother, where have you been the past 50 years?

 

[p51d007]

"Supply will remain tight" ie: PRICES will SKYROCKET. Duh!

 

[JimF1]

It's all corporate greed! This AI crap is just another excuse for the rich to get richer while shafting the one's who made them rich to begin with.

 

[Alfonso Maruccia]

What happens when the tech industry finally has a lucid moment, after years of getting drunk on AI hype and exponential stock gains? They know that the market doesn't want their product, but they're going full speed ahead anyway.

How bad is this hangover going to be?

Chip manufacturers and foundry companies will be mostly fine. Big Tech oligarchs and chatbot chaps, on the other hand, will enjoy one hell of a ride. At that point, no one will keep paying for Windows because there is frankly no point anymore. And I'm one of the *****s that purchased a boxed copy of Windows 10.

So, interesting times ahead...

 

[toooooot]

Goodbye affordable personal computers.

 

[yRaz]

Goodbye affordable personal computers.

Don't be so dramatic, most of the supply chain is not owned by US companies. These forgien companies don't believe the AI hype and they're just riding the gravy train until the crash and things go back to normal. I give it 18 months tops but we're already starting to see the cracks so it could be much sooner than that.