Despite demand for DDR remaining vibrant, DDR contract prices were dragged down slightly due to falling DDR2 prices in the second half of September. For the first half of October, DDR contract prices continued trending downward in line with the downward DDR2 pricing.
According to DRAMeXchange’s last update, the pace of DDR2 migration is still ahead of actual demand in the end market. DDR supply, on the other hand, has remained tight since May 2005 amid the production shift to DDR2 and reallocation of capacity to flash memory production. The diverse supply-demand scenarios between DDR and DDR2 were in evidence in the second half of August and first half of September, as the contract prices for the two segments trended in different directions, but since then falling DDR2 prices have started to influence the DDR contract market.
Although Intel cutting its supply of entry-level chipsets (910- and 915-series) received all the attention, supply of DDR2 supporting high-end 945-series chipsets continued to lag behind demand from August. So, although some PC OEMs intend to increase their DDR2 installation rates in PC systems this quarter, they may face a shortage of chipsets supporting DDR2 parts.
Upon this shortage concern, some DRAM makers that produce more DDR2 than DDR have become more conservative in boosting their DDR2 output this quarter. Nevertheless, they still expect DDR2 demand to grow significantly next month.
DRAMeXchange believes the continued chipset shortage will delay DDR2’s rise to the mainstream until the first quarter of 2006. The firm estimates that DDR2 accounted for 34% of overall DRAM demand last quarter. Buoyed by demand driven by notebooks, the penetration rate should grow further to 44.5% this quarter.
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Source:
Digitimes
Oct 7, 2005, 08:25 AM
