Growth in mobile DRAM mkt fructified Micron-Elpida deal

BANGALORE, INDIA: According to a report titled, ‘Mobile and embedded memory market brief’ by market research firm IHS  iSuppli, Mobile DRAM is set to hit a record $6.56 billion in revenue this year, up 10 per cent from $5.98 billion in 2011.

"The mobile DRAM segment is achieving impressive growth as mobile operating systems, streaming apps and games require more memory to handle sophisticated tasks. Crucial features like multitasking, media decoding and decompression, data synchronization and background operations are all driving DRAM needs, and new phones and tablets are meeting those needs with their rise in mobile DRAM densities,” said Ryan Chien, analyst for memory & storage at IHS.

DRAM market is expecting huge growth opportunities due to the increasing demand of high end smartphones and tablets. The growth in DRAM market is seen as one of the reasons for which the Micron-Elpida acquisition had fructified.

The DRAM revenue of Micron in the first quarter this year was $759 million and Elpida’s revenue was recorded at $780 million. At the same time, the mobile DRAM revenue of Elpida at $218 million was double that the $106 million for Micron (Mobile DRAM is a low-power DRAM variant currently preferred for use in mobile applications.)

"Such a disparity between the acquired and the buyer highlights a competitive differentiator for Elpida. Despite its financial ruin, Elpida in the first quarter had an outsized portion, nearly 20 per cent market share, of the total mobile DRAM industry revenue of $1.8 billion.

The increasing ubiquity of mobile DRAM projected for the next few years also makes the high-flying memory segment the most important factor in Micron’s $2.5 billion purchase, especially as the Boise, Idaho, outfit aims to counter the current market dominance of the South Korean giants Samsung Electronics and SK Hynix Semiconductor,” Chien said.

The research also confirms a rise in average densities of mobile DRAM in wireless devices. Mobile DRAM density in smartphones has grown from 2.28 gigabits (Gb) in the second quarter of 2010 to 5.85 Gb in the second quarter, this year.

The expansion is even greater in tablets, with the mobile DRAM average density soaring fourfold during the same period from 2.00 Gb to 8.33 Gb.