RAM prices dip, may slide further

MUMBAI: SDRAM prices, which were at their peak last year, have slid to their

lowest in August 2001. A 64MB module was priced at Rs 425 (excluding excise) in

the third week of August 2001, compared to Rs 450 in the previous week. In July,

the same module was costing about Rs 475.

128 MB and 256 MB memory modules were down at Rs 775 and Rs 1,500

respectively, in comparison to Rs 850 and Rs 1,800 in July. According to market

observers, the price slide began few months back after remaining steady for

quite some time. The last peak level reported this year was at around Rs 1,000

for 64 MB and Rs 1,700 for 128 MB.

Market sources claim that this is a normal phenomenon that happens whenever a

new technology comes in. According to them, people have started buying Pentium-4

based machines, which support only RDRAM. This has caused the sluggish demand

for SDRAM. "SDRAMs are used in machines with P-II and P-III while, people

have become technology-conscious and prefer to buy the latest," says a

memory reseller. RDRAM are expensive but considerably faster compared to SDRAM.

The present market price for 128 MB RDRAM is about Rs 4,600. When RDRAM was

first launched, its high cost, along with that of Pentium-4, kept consumers away

from buying it. Because of this Intel gave subsidies to those PC makers who used

RDRAM.

However, recently Intel has started phasing out this subsidy. The slow demand

for P-4 with RDRAM support has prompted it to release a new chipset with SDRAM

support. When this happens, analysts believe that SDRAM will again gain demand.

It may be recalled that, when price of RAMs were at its peak in September last

year, an earthquake hit Taiwan to make things worse. Taiwan is the major source

for RAM imports in India. Some observers also claim that the real reason for the

drop in SDRAM prices is because of an oversupply caused by poor sales of PCs

over the past few months.