Flash memory sales reach unprecedented levels, firm says
Cahners In-Stat Group
Jun 09, 2000 --- Fast rising sales of consumer products such as cellular phones, digital still cameras, Internet audio devices, handheld computers and set-top boxes are propelling the flash memory market to record heights, according to a recent report from Cahners In-Stat Group.
The market for flash memory chips is so robust that suppliers cannot keep up with demand. Cahners In-Stat Group forecasts that flash memory shipments will exceed $6 billion for 2000 and unit shipments will surpass 1.6 billion. By 2004, the total flash memory market will skyrocket to $16 billion with a compound annual growth rate of 20.5 percent.
Intense demand has ratcheted up average selling prices by more than 50 percent on some flash memory densities. Manufacturing lead times are running into more than 20 weeks for most densities. In-Stat believes demand will continue to exceed supply until at least mid-2001, when flash vendors plan to bring on more capacity.
The wireless phone handset market is the hottest driver for flash memory growth. Some wireless phone forecasts are as high as a billion units by 2003. In 2000, the wireless phone area will grow to $1.65 billion in flash shipments, with a 25 percent end use market share. By 2004, the wireless phone flash market will jump to $3.36 billion. By then, its flash memory market share will fall to 20 percent as emerging applications such as digital cameras, Internet audio devices and handheld computers gain market share.
The Internet Audio category, primarily MP3 Internet audio players, will be one of the fastest growing in the flash memory market as it shoots up from $132 million and 2 percent market share in 2000 to $1.68 billion and 10 percent share in 2004. Digital cameras?both still and camcorders?will also jump mightily from 4.5 percent share in 2000 to 13 percent share in 2004. The demand for more features and higher storage capacity on consumer products will require higher density flash memory devices.
Some manufacturers have allayed fears of flash memory shortages by signing multi-year procurement deals with vendors.
Samsung Electronics Co. Ltd. entered into a three-year flash memory supply agreement with Advanced Micro Devices in January. AMD will supply Samsung?s Wireless Terminal Division with flash memory for its cellular phones. Intel and Ericsson inked a deal in February in which Intel will supply an estimated $1.5 billion of flash memory to Ericsson for its cellular phone business. AMD signed a three-year supply agreement with Cisco Systems in March. AMD will supply flash memory for data and code storage in Cisco's network systems. These deals are just the beginning.
?More and more manufacturers will seek supply protection with multi-year purchase agreements,? said Grant Johnson, industry analyst with Cahners In-Stat Group.
eb-mag.com
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Those phone sale numbers are staggering.
Jack |
