updated 10:45 am EDT, Mon April 7, 2008
iSuppli Flash Order Drop
iSuppli today said it predicts a major drop in orders for NAND flash memory largely due to Apple. While the research group originally expected the value of orders to climb by 27 percent to peak at nearly $17.9 billion, it now estimates that growth to reach just $15.2 billion, or to grow by just a third at 9 percent. The overall drop is credited to reduced spending by US buyers unable to afford portable media players and other consumer electronics through defaults on subprime mortgages and the ripple effect it creates elsewhere in the world.
However, most of this is attributable to Apple as a benchmark, according to iSuppli. The company is the third-largest user of NAND flash for storage in its iPhones and iPods but has yet to make any large orders this year, suggesting that it doesn't expect a large spike in sales months later, as it did in 2007. Orders are still anticipated to increase overall but should reach $1.4 billion, or $400 million less than what Apple was initially expected to spend.
This comes in spite of new products from Apple that use flash memory. The optional solid-state drive for the MacBook Air "won't come close" to filling the gap, says the analyst group.
Suppliers are known to be cutting memory prices to compensate for overstock problems with hopes that Apple, SanDisk, Sony, and others will stock up on the cheaper memory in anticipation of the holidays this year.