SEOUL, SOUTH KOREA: Global sales of NAND flash memory chips, used in consumer electronics from digital cameras to mobile phones, are expected to decline this year and next as consumer spending weakens, research firm iSuppli forecast.

Worldwide NAND flash revenue is expected to fall 14 percent in 2008 to $12 billion, which would mark the first annual revenue decline for NAND, the U.S. research firm said in a note dated Friday.

In 2009, NAND flash sales will fall by another 15 percent, iSuppli said. The new forecast is a significant revision from its previous prediction that called for 3 percent decline in 2008 and 12 percent growth in 2009.

Memory chipmakers are struggling with a prolonged slump in the cash-starved sector while the spiralling global financial crisis has dried up demand for electronics.

As applications using NAND flash memory are mostly retail products, "NAND flash is bearing the brunt of the challenging retail conditions," said Nam Hyung Kim, chief analyst at iSuppli.

"Combined with uncertain global economic conditions and a lack of killer applications, the NAND flash memory business is facing a triple whammy."

The average selling price of 1-gigabyte equivalent of NAND is expected to drop by 62 percent in 2008, followed by a 50 percent fall in 2009, iSuppli said.

It maintained its negative rating for near-term market conditions for NAND suppliers, including Samsung Electronics, Toshiba and Hynix Semiconductor.