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SSDs still rule the NAND flashmarket

Posted: 25 Aug 2010     Print Version  Bookmark and Share

Keywords:NAND flash  solid state drives  SSD  storage 

Back in 2007, research house International Data Corp. (IDC) forecast that the SSD market would hit Rs.25,363.20 crore ($5.4 billion) by 2011 and that mass adoption would occur by 2011 or 2012. But this week, Mario Morales, an analyst with IDC, admitted that mass market adoption of SSDs is still "a generation or two away."

And SSDs have not exactly driven NAND demand, as previously predicted. SSDs are expected to make up only 6.1 per cent of worldwide NAND bit shipments in 2010, according to IDC. By 2013, SSDs are expected to make up only 9 per cent of worldwide NAND bit shipments, according to the firm.

That pales in comparison to mobile phones, which are expected to make up 36.1 per cent of NAND bit shipments this year and 38.9 per cent in 2013, according to IDC. In 2010, mobile phones are expected to be the biggest market for NAND bit shipments, followed by MP3 players (21.5 per cent), DSCs (17.3 per cent), USB drives (10.5 per cent), and then SSDs.

Needed change
SSDs still hold promise, but Morales said the dynamics must change on several fronts, such as cost and marketing, before these products become mass market wonders.

Morales said the SSD vendors have suffered from several false starts. ''Most companies are targeting the wrong markets,'' he said. ''Most are looking at PCs.''

The consumer PC market is tough, given that OEMs are still inclined to bundle their products with cheaper HDDs. Instead of PCs, SSD vendors should be looking at niche-oriented applications like portable games, tablet PCs and others, where HDDs are not in play, Morales said.

Cost is still the biggest stumbling block for SSDs to gain wider acceptance. In sub-1in form factors, SSDs have caught up with HDDs in terms of price parity, he said. But SSDs are still twice as expensive as HDDs in 1.8in and 2.5in form factors, he said.

HDDs continue to have an advantage, in part because NAND cost reductions have not kept pace. From 2002 to 2007, NAND prices dropped by an average of 50 per cent a year, thereby driving demand and new applications, he said. In 2010, NAND prices are expected to fall by only 20 per cent or less, Morales said.

That's good news for the NAND vendors, which are seeking profits to shore their bottom lines. But that's bad for SSD makers, which are trying to drive down costs. The real key in driving down SSD costs are the shift to 3b per cell and 4b per cell NAND, which could be cheaper than traditional 2b per cell NAND, Morales added.

After two years of inflated prices, NAND flash memory at the end of 2010 is set to return to the key Rs.46.97 ($1)/MB level, according to iSuppli Corp. This is considered a key threshold to drive adoption of SSDs, but the cost reduction may come ''too late to help the struggling SSD market,'' according to the market research firm.


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