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Flash Memory heralds slew of gadgets

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CIOL Bureau
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Doug Young



TAIPEI: From mobile phones to video cameras, gadget makers are conjuring up new products to take advantage of cheaper flash microchips with bigger memories.



The chips are already ubiquitous, at the heart of the memory cards used in digital cameras and key-sized drives that plug into a computer's USB drive.

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But a recent slide in prices and increase in memory capacities is giving a further boost to sales of flash-based products and encouraging manufacturers to come up with new applications.



The shifts herald a longer-term trend that could eventually spell the demise of storage media such as compact disks and even DVDs, and promise even fatter profits for flash chip makers Samsung Electronics Co Ltd. and Toshiba Corp.

At the Computex computer show this week in Taiwan, KingByte Information Corp was crowing about booming demand for its MusicDrive, a device the size of a lipstick that stores data and plays back music.



Vice-manager of sales, Luisa Sam said the wholesale price for a 512 megabyte (MB) MusicDrive, which can hold about eight hours of music, had dropped to US$98 from US$135 in early 2004.



"At the beginning of the year, we were shipping just 3,000 MusicDrives a month because the price was very high," she said. "Now we are shipping about 10,000 a month."

Sam said MusicDrives can come with up to 16 gigabytes of memory, enough for more than five days of music, albeit at a hefty price tag of $2,000.



"We have special customers with U.S. military applications, who have ordered this model," she said, declining to name the buyers.

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SOLID STATE



Flash's triumph over older storage media such as audio cassettes and floppy disks is the start of a shift toward storing data on solid state devices, so called because they lack moving parts.



Compared with hard drives and CD and DVD players, flash drives require less energy, gives off less heat and are less prone to breaking down -- all major pluses for portable devices.



The shortcoming of flash has been price and capacity, but that is changing as manufacturers ramp up production.

The average price of 512-megabit flash chips has tumbled to $9 last month from a $21.50 peak in October. And while a 64 MB memory card was seen as generous a year ago, capacities are now extending into gigabytes.



"At some time in the future, all storage will be solid state," said Paul O'Donovan, an analyst with electronic research group, Gartner.

The bigger-capacity drives should help the digital camera industry, since a typical photo of three megapixel or more takes up at least one megabyte, analysts said.



They could also replace tapes in video cameras, just as flash memory has replaced film for snapshots. A company called Pretec Electronics Corp., was showing a US$300 video camera at Computex the size of a cigarette packet, able to store three hours of VHS-quality video on a 512 MB flash card.



Panasonic, the brand of Matsushita Electric Industrial Co Ltd , is selling a similar product offering DVD-quality video for about US$1,000.

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Cheaper flash is also changing mobile phone designs. Motorola Inc, the world's second-largest cellphone maker, has adorned its forthcoming E398 phone with a special loudspeaker for playing music stored on up to 256 MB of flash memory.



The phone is due out this quarter and expected to sell for US$200-$300, said J.C. Oligario, a technology marketing manager.

Flash memory differs from standard computer memory in that it retains its contents even when it is without power. Technology analysts at Gartner estimate that the most common removable flash memory, known as NAND, will account for 18 percent of worldwide memory sales by 2006, more than double the eight percent in 2002.

Sales over that period are expected to jump to US$8.32 billion from US$2.36 billion.



Samsung and Toshiba, which dominate the market, had sales of NAND flash of US$1.16 billion and US$512 million in 2003, respectively.






© Reuters

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