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NAND flash market due for another clash

Posted: 29 Jan 2008     Print Version  Bookmark and Share

Keywords:NAND flash  market crash  1H 08 

The NAND flash market is possibly due for another crash given recent select shortages and flat average selling prices.

Apple Inc., the world's largest NAND buyer, is cutting back on its procurement of the parts, according to analyst Edwin Mok of Needham & Co. LLC. ''We heard that Apple reduced NAND purchases in December/January.''

There is also no killer application for NAND right now, the analyst said.

''In 2006, Apple took similar cutbacks, and a surge in supply growth resulted in a 70 per cent plus price decline for NAND chips from January to September 2006,'' he said.

''While prices have already fallen 40-50 per cent since November 2006, we see more pressure in 1H 08 due to new supplies coming online,'' he added. ''We believe NAND prices will further decline in 1H 08 due to accelerated supply growth and lack of a new demand driver.''

Micron, Toshiba and Samsung continue to ramp up their respective NAND capacities. In fact, the mood is changing at Toshiba Corp., especially for its NAND flash efforts.

Adding to the woes is a potential legal problem for vendors. A class action suit was filed against SanDisk Corp. and 23 other companies over alleged price fixing for NAND flash memory devices in the market. There are also signs that the U.S. Department of Justice and a Canadian agency are looking into alleged price fixing practices in the market.

- Mark LaPedus
EE Times

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