Sales of DRAM for notebooks and PCs continued to show a downturn during September, which is good news for buyers and bad news for the vendors.
DRAM Exchange, which tracks memory prices, said that part of the reason for the underlying decline is that notebook shipments in the third quarter didn’t reach expectations, with the Windows 10 free upgrade hitting potential sales of new notebooks.
Analyst VP Avril Wu said that sales of both smartphones and servers aren’t great. “This seriously eroded the margins of DRAM suppliers,” she said. “If the global economy continues to stagnate, the end market will not generate the demand needed to effectively consume the new DRAM chips produced on advanced processes.”
She predicted that prices will continue decline in the first half of next year, and the decline will be “more severe than the current slide”.
The DRAM market continues to be dominated by Samsung, SK Hynix and Micron and they moving production of the chips to 17 nanometres, meaning higher densities and better power efficiency.
Samsung will start producing 18 nanometre technology chips next year, and is ahead of the other two players.
The average contract price of DDR3 4GB fell to $20.5 last month, a 15 percent drop from the price in June 2015.
DRAMeXchange said prices of DRAM will fall below $20 in the third quarter.
The DRAM analyst, Avril Wu, said that the global economy is in an uncertain period. “This results in downward revisions in performance forecasts across the DRAM industry, from wafer foundry’s capacity utilisation rate to mobile phone and notebook shipments.”
And Wu said that the arrival of Windows 10 is not going to give any significant boost to the DRAM market, meaning the notebook market won’t show its usual peak season in the third quarter.
She said: “Windows 10 has not generated enough replacement demand to drive notebook sales and third quarter notebook shipments will grow by only 6.1 percent compared to the prior quarter.”
Samsung, a major manufacturer of DRAM, has successfully moved to a 20 nanometre process in its foundries “and has the lowest cost structure”. That allowed the Korean giant to continue to be profitable, but Micron is struggling.
The widespread availability of different types of cloud storage is having a bad effect on makers of memory cards and flash drives.
That’s according to analysts from DRAM Exchange, which said that these types of products were a major revenue source for vendors, but those times are changing.
DRAM Exchange – a subsidiary of Trendforce – said that companies are struggling because of cloud storage services and high density flash storage designs.
Companies like Dropbox and Spotify are big in the cloud service business and increasing use of such services eliminates the need for people to buy flash cards and memory cards.
The move is underlined by the availability of services like Google Drive, Microsoft’s One Drive, and Apple’s iCloud and Apple Music.
Assistant VP of DRAM Exchange Sean Yang said: “Memory module makers are very worried about market saturation and decline when they are planning for their next flash drive products.”
Yang added that the global financial market’s downturn means vendors of smartphones, notebooks and tablets are slimming down their forecasts.
Because of all of this, DRAM Exchange thinks NAND flash memory prices will fall significantly during this third quarter.
US analyst company IHS has confirmed other reports about the future of 4K TV – the technology is going through a boom period right now and into 2016.
In case you don’t get the picture, 4K ultra HD televisions can show as many as eight million pixels per screen compared to two million for 1080p Full HD.
IHS said that in 2016, one of five TVs will use 4K TV panels – that’s down to people wanting high definition images as well as better production from the companies that make the panels.
And, according to senior analyst Linda Lin, prices of the panels began to fall in 2014 and earlier this year. She said most TV brands now have 4K UHD products.
South Korean companies are now leading the race to produce panels with LG Display and Samsung the biggest manufacturers worldwide.
IHS said shipments of 4K TV panels were over three million units in April this year – that’s 14 percent of all TV panels.
Rigid LCD screens won’t be a thing of the past unless the makers of flexible panels get more price competitive.
The manufacturers of organic light emitting diode (OLED) panels are looking to make more flexible active matrix organic light emitting diode (AMOLED) panels, according to a report from research company IHS.
We don’t have to spell out all the words in AMOLED again, but the leaders in manufacturing these flexible panels are Korean giants Samsung and LG Display.
Those two manufacturers are ramping up production of flexible panels this year and IHS thinks flexible shipments are set to grow exponentially.
The reason why flexible panels seem to be the order of the day is because IHS believes wearable and other form factors need them.
But the snag is that smartphone makers – presumably other than Samsung and LG – find AMOLED panels to be a little too expensive for their purposes.
Principal analyst Jerry Kang at IHS, said: “Smartphone makers were unhappy with the price of AMOLED panels, because higher priced performance AMOLED displays had lower sharpness than LTPS LCD displays with the same resolution. As the wide colour gamut of AMOLED displays has not been a major differentiation factor in the smartphone panel market, current AMOLED panels will eventually lose their appeal, unless prices decline further.”
Attempts by manufacturers to put up their prices on mobile DRAM appear to have stalled.
In the first quarter, said memory watcher DRAMeXchange, mobile DRAM revenues totalled $3.576 billion which is actually a small decline compared to the same quarter last year.
But despite that, mobile DRAM now accounts for 29.8 percent of total shipments worldwide and that figure will continue to increase.
Average selling prices for mobile DRAM are stable, while shipments grew as Samsung ramped up volumes by producing chips at 23 nanometres.
DRAMeXchange anticipates that prices will stay stable for the whole of the first half of this year. While next generation iPhones will use 2GB of mobile memory, prices will fall.
While the outlook is rosy for mobile DRAM, PC memory prices have fallen.
The major memory manufacturers are Samsung, SK Hynix and US firm Micron. Other much smaller players are Taiwanese companies Nanya and Winbond with the latter having a global market share of only one percent.
Renasas has seen a fall in its stock price following its announcement that it plans to axe at least 12,000 jobs and get rid of operations that are costing it money.
Shares fell by 11 percent this morning following the announcements last week, which are thought to be a domino effect from the February bankruptcy filing of Elpida Memory. The company is also reportedly unable to keep up with competition from rivals such as Samsung.
In a bid to try and stay afloat the company announced its restructuring plan, which as well as the job cuts would see the company moving to raise $1.26 billion (100 billion yen).
It will also move to strengthen its position further by teaming up with Taiwan Semiconductor Manufacturing Company, which sources say will probably involve an outsourcing deal as well as flogging it a chip plant in northern Japan.
However, currently the plans are just talk, with sources telling Reuters that the company must get approval from its main shareholders, which include members from Hitachi, Mitsubishi and NEC. The trio of companies are said to hold more than 90 percent of Renesas shares.
Reactions from these companies however, could be mixed. It is thought Mitsubishi will be happy to agree, riding high from shares in the business. However NEC, whose chip division was merged into Renesas just two years ago may not be so confident as a result of being hit with steep losses in recent years.
One arm of Renesas’s business that may face the chop is its LSI unit, which has been losing the company a fair amount of money. Sales in the unit fell 35.5 percent in the year that ended on March 31.
It is believed that the Japanese government may move in to help Renesas shift this business by pushing a plan to give this to Panasonic and Fujitsu with the help of funding. It may also move to help sell off the failing company’s factories.
Intel has revealed new mobile plans for its partners and it shared some pricing guidelines for future products.
Fudzilla has found a slide with the catchy title Mobile Landscape in 2012.
In it, Intel said it wants to sell mobile phones powered by its CPUs for as little as $199 to $299.
Intel sees a gap in the market for cheap and cheerful phones .
It also places netbooks in the same price range while Intel based tablets should be between $399 and $499.
Tablets will go up to 12.1 inches and the starting price for these bigger machines should be $299, Intel said.
It is looking like hybrid devices, such as the Asus‘ Eee Pad Slider and Transformer, will also stay at less than $699.
Intel wants to sell its laptops for less than $400. Top notch notebooks based on Core i7 chips will start at less than $799 and Ultrabooks with 11-inch or larger screens might be coming down to $599 to $699.
Taiwan Semiconductor Manufacturing Company (TSMC) won’t be lowering prices any time soon. Instead it will capitalise on its leading position and will dictate how the market operates.
There were reports in Taiwan’s Economic Daily suggesting the company has been in talks with clients to lower prices by three to five percent in the third quarter.
But it doesn’t make sense, according to industry analyst at Future Horizons Malcolm Penn. The company, really, has a monopoly on the industry – and given the time of the year and the health of the markets, TSMC will do no such thing.
“Now is a good time for the industry, demand is high and the Japanese earthquake has affected supply, meaning prices should be going up, something TSMC knows,” Penn told TechEye.
He pointed out that TSMC has such a huge grasp on the market that “if it was to reduce or up prices the industry would be affected.”
“There would be no reason for the company to reduce their prices,” said Penn.
He reckons clients wouldn’t buy from the company “without first agreeing a fixed price, as they don’t want any surprises when they get their supply.”
“The fact is that TSMC is a major player in the market, it sets the bar for the industry with the exception of Apple,” he said.
“Take out the big ones and the world is TSMC’s. It says jump, we say, how high?”
LinkedIn is throwing around those dollar bills. The business networking company has said it will be offering 7.84 million shares in its initial public offering. This works out to $32-$35 each.
If punters all go for the higher share price, this could land the company up to $274 million. It is also offering 4.8 million shares, and the rest by some of its stockholders such as co-founder and chairman Reid Hoffman. The head honch is selling his shares in the IPO alongside others, shares of which are claimed to represent about 21.7 percent of voting power after the offering.
Other key stakeholders offering up their wares, sorry, shares, include Goldman Sachs, McGraw-Hill and Bain Capital Venture Integral Investors LLC.
However, the sales won’t be a surprise to many considering that in January LinkedIn filed for an IPO to raise up to $175 million.
The company expects to receive net proceeds of about $146.6 million from the shares it is offering in the IPO.