Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Micron Only Forum -- Ignore unavailable to you. Want to Upgrade?

To: Skeeter Bug who wrote (47563)	8/9/1999 9:12:00 AM
From: Bharat H. Barai	Read Replies (3) \| Respond to of 53903

The cost of making DRAM is much lower in Taiwan and USA with .20 and .18 technology. According to my sources, in Taiwan, the cost of materials used is around $ 3, with depreciation and other expenses counted: $ 1 to 1.50 more. Some Japanese companies are still using old .35 process and did not modernize during deep recession in Japan. Because of volatile DRAM pricing in past and uncertain future, one may decide to switch to other products rather than put more money in modernization of DRAM manufacturing. In fact many big Japanese firms have shifted DRAM manufacturing to Taiwan. So NEC cannot make money in DRAM at cost structure of $ 10. Exit of some players and consolidation among others will eventually bring the supply and demand situation to market level. DRAM is a must part of PCs. There is lead time of almost 2 years between decision to expand and flow of DRAM from new fabs. It is during this time that shortages occur and DRAM prices shoot up. I hope DRAM manufacturers and their lending banks have learnt lessons from past disasters when Korean manufacturers came close to melt down. If they moderate during the next upturn and not over produce, they all will stay profitable. Stay tuned !!!