DDR3 memory won't be mainstream until 2010

TAIPEI, TAIWAN: The overall oversupply situation and the severe 2H08 financial crisis not only influenced DDR2 1Gb eTT chip price to drop 73 percent, DDR3 chip price was also affected by DDR2.

DDR3 1033 Mhz 1GB contract price plunged from $13 to $8 in Q4, which is a 40 percent drop. Its price was about the same as the DDR2 667 Mhz 1GB contract price in December of 2008. "From the oversupply situation to the global recession, the schedule of DDR3 becoming mainstream item has been delayed again and again," says DRAMeXchange.

From the supply analysis, according to the statistics of DRAMeXchange, along with the cost down of DRAM vendors and 2009 CAPEX cut, the total expenditure of DRAM industry is estimated to be $7 billion, which is a 50 percent decrease comparing to $13.5 billion of 2008.

This also means that the DRAM vendors have no extra money to invest in DDR3 capacity and only can allocate their CAPEX in the process migration of DDR2 chips. DRAMeXchange estimates that the DDR3 market share will reach 28 percent at the end of 2009, and DDR2 about 50 percent. The DDR3 will account for 17 percent average market share of the whole year 2009 and DDR2 about 60 percent, respectively.

From the demand analysis, under this recession environment, the Netbook may have chance to grow over 100 percent globally, this year, and the MB and NB will grow about -17 percent and -2 percent, respectively. The coming wave of Netbook not only decreases the DRAM content per system of PC, but also puts a big stone in the way of migrating to DDR3. (See *1)

In the retail market, although the December DDR3 contract price is the same as DDR2, this price is between the DRAM vendors and the PC OEMs. In the retail market, the 1 GB DDR3 DRAM module price keeps in the range between $20-25, which still enjoys $10-15 price premium comparing to DDR2.

In addition, the MB vendors price their boards with DDR3 support in the range of $200-300, which is $70-100 higher than the mainstream DDR2 supported boards. In the retail market, the shipment was not well performed, said module houses. The DDR3 memory module shipment is still less than 1 percent of the total, which makes it harder to open the DDR3 market.

From the chipset aspect, the Intel X58 series sales was under expectation and may delay the planned termination of DDR2 support in mid 2009. Plus the DDR3 migration schedule of DRAM vendors has fallen behind, the DDR2 will still be the mainstream chip of the year. The time of DDR3 chip becoming the mainstream item will deferred to 2010. (See *2)

*1. Netbook can only be equipped with DDR2 533 Mhz 2GB memory modules due to hardware limitations.
*2. Intel X58 series chipset supports the Intel new CPU i7, and only supports DDR3 memory.