This DRAM thingie is a real peach. TI is out of the business, giving it to MU and providing MU with some royalty concessions the Pacific Rim companies do not enjoy. The Hyundai - LG Semcion marriage is still tenuous, which is affecting both of their companies. The major Japanese DRAM producers have defintely consolidated their operations. the rest of Korea and the Taiwanese seemed to be able to ramp up their capacity as needed AFTER emptying the pipeline. DRAM pricing was holding up until the "PC Crisis" set in. One would think that all of these sub $600 PCs coming onto the market are underpowered with RAM, since they package these units with only 32 Meg most of the time. We should see follow on upgrades down the road. CPQ's own problems seems to have put the caution flag out even after the kick butt IBM results hit the street and the good stuff came out of GTW.
DRAM prices stabilized until the recent capacity ramps occurred, pushing things out of kilter again. The market is not absorbing these ICs efficiently, YET. Besides that, This recent turnabout with the RMBS RDRAM by INTC has caused a bump in the road. Putting off RDRAM will have an adverse effect on margins for many of the DRAM producers. The alternative PC-133 designs need to be evaluated by the street for margins and other nice financials.
So, the DRAM problem is partially the PC crisis, part RDRAM directional change, and a large part, the incremental increase in available ICs due to the step function ramping of capacity. Increasing wafer starts by 500 wafers per week could put well in excess of 500K DRAM chips on the market on an 8" line. Do this across a few fabs and we go from famine to glut. Ramps are not slow and we saw this ramp coming about 6 weeks ago.
What we need is an acceleration of the new uses for memory products and modules. The cell phone, Car, GPS, Palm Pilots, digital electronics, and even video graphics in the form of adapter cards and games themselves, need to advance their capabilities to accept more memory.
One would think a damn digital answering machine could hold an hours worth of messages these days<GGG>. Due to the way DRAM capacity comes on board, the supply-demand see-saw gets imbalanced at times.
SPAM time: Anyone who was followed our idea relating to BRKS yesterday, made enough money to sunscribe to RadarView after commssions and taxes. It was as easy as B_R_K_S<GGG>
Check us out by requesting a complimentary copy today at stepman@hotmail.com <GGG> There, that didn't hurt.
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