DRam set for tough year

Samsung remained the dominant player in the global DRam market in 2004, but dark horse Hynix Semiconductor managed to regain the number-two spot from Micron.

According to analyst firm iSuppli, the volatile DRam market experienced strong growth of 51 per cent last year compared with 2003. The most characteristic feature of 2004 was the rush by traditional DRam vendors to launch into new memory markets, particularly NAND Flash.

Following Samsung's lead, Hynix, Micron and Infineon Technologies all entered the NAND Flash space.

Samsung continued its command at the top, increasing its market share slightly to 28.8 per cent. Despite punitive European and US tariffs, Hynix outgrew the market average with revenues jumping by 68.3 per cent to snatch second place from Micron, which has been struggling to diversify its product range.

In contrast, Hynix sold off its non-DRam businesses in 2004 to concentrate on the DRam market. Hynix controlled 16.4 per cent of the market, while Micron dominated 16.1 per cent.

The most impressive player throughout 2004 was sixth-place Powerchip, which saw its revenues soar by 164.1 per cent. Its technology partner, Elpida, registered a 122.8 per cent jump in revenue to regain fifth place for the first time since 2003.

Despite the sterling year that 2004 turned out to be, 2005 is going to much tougher, according to iSuppli. "DRam market growth will be much slower in 2005," said Nam Hyung Kim, principal analyst at iSuppli.

"Product line mix changes will be a major issue in 2005, not only because of the switch of production from commodity DRam to non-commodity DRam or NAND Flash and back again but because of process migration issues."

Paul Stevens, integration business unit manager at Memory Plus, said: "The word on the street is that output will exceed demand, which means there is going to be a lot of excess DRam around."

crn@vnu.co.uk