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NAND pricing set to return to $1 per gigabyte
El Segundo, Calif. — By the end of 2010, NAND flash memory pricing is set to return to the $1 per megabyte pricing level, considered key to drive the adoption of solid-state drives (SSD), reports iSuppli Corp.. But the market research firm says it may be too late to help the SSD market.
iSuppli’s report, “Are the Stars Aligned for $1/GB NAND? ,” forecasts that pricing for 1 Gbyte of 3-bit per cell (TLC) NAND flash memory will average $1.20 for the entire fourth quarter and then decline to $1.00 at the end of the year, after two years of inflated prices. This is a significant drop from the first quarter of 2010, when pricing for TLC averaged $1.80 per gigabyte and 2-bit per cell (MLC) flash was at $2.05, said iSuppli.
It also marks the first time NAND flash pricing fell below the $1 threshold since the fourth quarter of 2008, when MLC pricing averaged 90 cents per gigabyte.
“When NAND pricing first fell below the $1 level at the end of 2008, many observers opined that its would sound the starting gun for solid state storage, allowing the technology to be cost competitive with hard disk drives (HDDs) in PCs for the first time,” said Michael Yang, senior analyst for memory and storage at iSuppli, in a statement.
“However, during the following quarters, pricing rose because of strong demand and constrained production capacity, limiting the appeal of SSDs to low-volume servers in data centers and preventing widespread adoption in high-volume business and consumer PCs.”
In order for SSDs to compete successfully with HDDs, which gained a lot of ground over the past few years in terms of higher capacity and falling prices, per-gigabyte pricing for NAND flash memory will have to decline to 40 cents by 2012, Yang added. At that pricing, a 100-Gbyte SSD could cost $50, when supporting electronics are added in. This would make solid state storage more appealing in consumer and corporate PCs, he said.
Market research firm Objective Analysis believes that SSDs are poised for rapid growth in some niche markets, and will reach more than $7 billion in revenues in 2015.
“The PC market for SSDs has been slow to develop,” said Jim Handy, analyst for Objective Analysis, in a statement. “The strongest growth has occurred in areas where HDDs simply will not operate and in systems for which users are willing to pay a significant premium for a SSDs’ faster speed or greater durability.”
iSuppli is almost certain that there will be shortages for MLC NAND during the second half of the year, but it will be the opposite scenario for TLC. Average capacity for TLC chips in SD (secure digital memory) cards and USB storage devices has stagnated during the past year, and when combined with a slowing unit demand due to seasonality, ASPs for TLC chips are falling, said iSuppli.
iSuppli says tightly managed inventory levels, along with the closing of some factories, are paving the way for new price competition in the TLC segment, indicating a very real possibility that the $1 per gigabyte level might be reached by the end of 2010.
iSuppli projects that the overall industry for NAND flash memory will reach a record $5 billion in revenue in the third quarter.
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