To: FJB who wrote (50672 ) 1/7/2011 6:24:22 PM From: Sam 2 Recommendations Read Replies (1) | Respond to Interesting article, thanks for posting it nice to read some of the stats on MOCVD tools. They may well be overbuilding (see the relevant excerpt from the article below), which is why I was quick (way too quick, clearly) to jettison VECO last year when it was down. But I want to say something about the difference between the LED market on the one hand and the NAND market on the other. They are both high growth, but you see a lot new entrants rushing into the LED market. You don't see new players rushing to get into NAND, even with enormous projected growth. Why not, if it is "just another commodity" like LEDs or DRAM? Because it is extremely expensive to produce, high quality MLC and TLC NAND chips aren't easy to produce, they require sophisticated controllers in order to be effective, many of the effective production processes are protected by patents, and there are currently two vendors who control about 80% of the market (Samsung and Toshiba/Sandisk) who have both very aggressively pushed to cut costs by adopting the most advanced production processes as quickly as they can. Not only has no new vendor made any noises about entering the market for several years now, but it looks like Intel is exiting their partnership with Micron, who will be forced the bear the costs of upgrading their NAND and DRAM fabs alone. I daresay no other new vendor will be entering the NAND sector, and neither Hynix nor Micron--the other two companies that currently produce NAND--will be able to take much if any share from the leaders.
