NAND Flash in 80pc of 1Q08 MP3/PMP

TAIPEI, TAIWAN: According to DRAMeXchange, MP3/PMP's 1Q08 worldwide shipment reached roughly 42.58M units. Among this figure, over 83 percent uses NAND Flash as the storage medium.

In the MP3/PMP market, Apple is still the leading brand with a share of 73 percent. Other tier-one players in the market include Samsung, SanDisk, Sony, Creative and Philips.

As 2Q is a traditionally slow season for MP3/PMP, demand is still reasonably weak. We expect the 2Q shipment numbers to be more or less the same with that of 1Q 's at the range between 41M to 42M units.

However, given that the mainstream capacity of MP3/MP3 has already exceeded 4GB, and more vendors will have 16GB to 32GB products released, we expect the average NAND Flash capacity per MP3/PMP to increase up to 5GB or 6GB. Subsequently, 2Q NAND Flash consumption by MP3/PMP will increase and grow 29 percent  compared to 1Q08.

Currently, NAND Flash demand is weakened by the effect of the traditionally slow season. At the same time, downstream vendors have either adopted a low stock policy or are continuing to lower their inventory level, which has led to a mild decrease in total NAND Flash procurement.

Due to a weak demand in  the market, the average NAND Flash contract price of 2HMay may either stay stable or slightly fall. Hot season demand for NAND Flash is expected to significantly recover in early 3Q08. The price is likely to gradually rebound in 2H08.