ProMOS rises to meet Vista-fueled demand for DRAM
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(InfoWorld) - ProMOS Technologies may raise its capital spending plans for 2007 to meet brisk demand for DRAM (dynamic RAM) chips caused by the launch of Microsoft'sÂ new Windows Vista OS. The Taiwanese company's capital spending may be raised to speed the ramp up of a new 12-inch factory and hurry the construction of another such factory, said Ben Tseng, a vice president at ProMOS, in a phone interview on Thursday. A company plan to build two additional state-of-the-art 12-inch chip factories over the next three years, at an estimated cost of US$7 billion will have no impact on current spending plans, he said. "Even if we break ground later this year, that's not going to change the capex number," he said, because the cost would be minimal compared to the $1.25 billion in spending the company forecast for this year. He declined to say exactly how much ProMOS might increase its spending this year because his company is in a quiet period mandated by stock market regulators to keep companies from divulging information ahead of a quarterly financial announcement or stock or bond issuance. Taiwanese DRAM makers are planning to spend billions of dollars on new factories and equipment this year mainly due to Vista. The new OS has helped DRAM companies with stricter system memory requirements for PCs and by increasing demand ahead of the launch. Microsoft stipulates that computer makers install 512MB of DRAM for a PC to be considered 'Vista Capable,' which is good enough to run Windows Vista Home Basic. For Windows Vista Home Premium, Windows Vista Business, Windows Vista Enterprise, and Windows Vista Ultimate, Microsoft set the basic system requirement at 1GB of DRAM. It's a big difference compared to PCs running Windows XP, which requires only 125MB of DRAM. DRAM prices surged last year as PC makers started making Vista-capable PCs and stockpiled excess chips ahead of the launch of the new OS. The price of the most widely used DRAM chips, 512Mb, 667MHz DDR2 (double data rate, second generation), leaped 61 percent last year to $6.36, according to DRAMeXchange Technology, which runs an online DRAM market. ProMOS's rivals in Taiwan have announcedÂ major spending plansÂ on new factories this year. Powerchip Semiconductor, the largest DRAM maker in Taiwan by revenue, plans to spend NT$69 billion (US$2.1 billion), while the third largest player, Nanya Technology, intends to spend NT$60 billion.
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Its memory-chip breakthrough could lead to new products.
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Western Digital has boosted the capacity of its My Book line of external drives.
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The 1Gb DRAM (dynamic RAM) chip has replaced 512Gb DRAM as the mainstream memory capacity in the PC industry as of October, according to DRAMeXchange, a sign most PCs coming off production lines can now use Microsoft&#39;s Vista OS.All of the premium versions of Vista require&#160;more DRAM per PC&#160;to ensure smooth operation of the OS, which is more complex and requires more hardware than its predecessor, XP.The changeover in the DRAM market has taken longer than many companies expected. Several DRAM makers&#160;built new factories in anticipation&#160;Vista would take the PC market by storm this year and antiquate XP. That hasn&#39;t happened. Instead, the adoption of the new OS is moving along at a steady pace, albeit&#160;slower than the DRAM industry expected.The heavy investment in DRAM factories, however, has caused a massive oversupply.&#160;Prices of most DRAM chips have fallen&#160;by over 70 percent so far this year, and are currently near or below the cost of production for most companies.The contract price of 1Gb, DDR2 (double data rate, second generation) DRAM chips that run at 667MHz fell 12.5 percent from two weeks ago to $2.63 each, a new low for this year according to DRAMeXchange, which runs an online trading site for the chips. The most recent DRAM slump hit in early October, as prices fell by 25 percent. Analysts said the market may not turn around until late next year, and possibly later if companies keep building new production lines.&quot;We do not expect memory chip makers to show any improvement in profitability at least until [the second half of 2008] unless there is stabilization or a recovery in pricing,&quot; said Warren Lau, chip industry analyst at Macquarie Research.Samsung Electronics already increased its production line spending plans 23 percent this year, he said, and the aggressive stance will likely cause rivals such as Elpida Memory and Hynix Semiconductor&#160;to follow suit so they can protect or increase their DRAM market share.Increased spending amid a chip glut should keep DRAM cheap for a while. Market prices normally take about a month to filter down to users, according to one DRAMeXchange analyst, and users can benefit from lower prices in a few ways. PC vendors often increase the amount of DRAM per computer when prices are low, or offer additional DRAM as an incentive to buy a new PC. Also, the price of DRAM modules found in stores will fall as retailers clear out their older, more expensive inventory.Contract DRAM prices are renegotiated every two weeks between DRAM makers and PC vendors such as Hewlett-Packard&#160;and Dell. Around 80 percent of all DRAM is sold by contract, while the rest is sold on a spot market similar to commodities trading in oil and gold.&#160;
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(InfoWorld) - PCs running Microsoft'sÂ new Windows Vista operating systemÂ got a cool response from consumers in Japan during their first month on sale, according to data published Tuesday. Sales of desktop and laptop computers from brand-name makers in February were 1.2 percent higher than the same month in 2006, said BCN. The company came up with its figure after analyzing point-of-sales system data from about 560 specialist PC and electronics shops that are part of 12 retail chains. The entire market was up 6 percent thanks to better demand for white-box PCs made by computer stores and for motherboards. The jump in the brand-market was smaller than expected by market watchers, who thought the launch of the long-awaited operating system on Jan. 30 would give the PC market more of a kick. Better sales had been expected in part because consumers had shown a lack of interest in new PCs in the months prior to Vista's launch. In October, sales were down 21 percent compared to the previous year. In November, they were 22 percent lower, in December 19 percent down and in January 14 percent below the same month in 2006. The little strength there was in the brand-name market came from increased sales of laptops, sales of which were up 9.3 percent on a unit basis for the month, said BCN. The desktop sector was down 13.8 percent on the year. Despite the apparently lackluster response from Japanese consumers, Microsoft and two major PC makers have in the last 24 hours given the Vista launch votes of confidence. "We're actually pretty happy with how the launch has gone so far," said Darren Huston, president and CEO of Microsoft's Japan unit, at a news conference on Monday. The same day Walt Mayo, corporate director of Dell Japan's home and business sales division, said in an interview that the Vista launch has been "good overall." On Tuesday Richard Walker, head of Hewlett Packard's consumer PC division, said sales of Vista PCs were "strong" in the global market. He didn't have any data specific to the Japanese market. "We're definitely ahead of our plan as far as Vista is concerned," he said. Among Vista sales demand for the premium versions has been greater than anticipated, said Microsoft's Huston. "That was actually a good, positive surprise for us," he said.
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Flash memory stick makers are showing off USB (Universal Serial Bus) drives at Computex that have been certified to work with Windows Vista&#39;s ReadyBoot and ReadyBoost functions, which improve boot-up times and the software start-up speeds in PCs.
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The 512-gigabit DRAM has been replaced, meaning most new PCs can run Windows Vista.
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Seoul, South Korea-based Samsung Electronics Co. Ltd. has begun shipping a 512Mbit GDDR2 memory device, one it claims is the most advanced graphics double-data-rate synchronous DRAM available.
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Microsoft Corp.'s new Windows Vista operating system spurred a 67 percent increase in personal-computer sales at U S retail stores in its first week on the market, according to research firm Current Analysis Inc.
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The design twist will let the company increase the performance of its processors.
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(InfoWorld) - Anyone looking to add a bit more memory to their computers won a gift from the DRAM (dynamic RAM) industry. Heavy competition has caused prices to tumble and industry analysts predict further price declines. The contract price of the most widely used DRAM chips, 512Mb, DDR2 (double data rate, second generation) chips that run at 667MHz dropped 12.5 percent from two weeks ago to $1.75 each as of Thursday, a new low for this year according to DRAMeXchange Technology, which runs an online trading site for the chips. That's great news for users for three reasons. DRAM price declines increase the likelihood that PC vendors such as Hewlett-Packard and Dell will add more DRAM to the computers they sell, or offer extra DRAM as an incentive; it give users a chance to buy more DRAM on the cheap; and it generallyÂ spurs memory chip makers to move forward on new technologyÂ that will ultimately increase computing performance. Contract DRAM prices for DDR2-667 chips have plunged 70.5 percent so far this year to the Thursday low. The main reason is because memory chip makers built too many new production lines in anticipationÂ of strong demand for Microsoft's Windows Vista, which requires more DRAM per PC, as well as because stronger DRAM prices in general for the past few years was a sign to some that the market had stabilized, analysts say. DRAM prices may continue to decline a bit further, but downside appears limited, according to Gartner. Today's pricing is at a similar level to the lows reached in May of this year, when DRAM makers refused to sell because the price had hit their cash cost. "However, we may see some activity below this level, because some brokers and distributors who are holding inventory may be prepared to sell at a lower price to clear stock," the market researcher said. Over the years, DRAM makers have tended to place more emphasis on winning market share than on profits, and the current DRAM price declines are symptomatic of their battles. Companies have invested so much money in new factories that the increased output has caused a glut, leading to price declines. Prices for DRAM chips fellÂ almost 40 percent in the first half of this year, compared to the first half of 2006, offsetting a 66 percent increase in unit shipments, according to the Semiconductor Industry Association. Contract prices are typically renegotiated between DRAM makers and PC vendors every two weeks. Around four fifths of all DRAM is sold by contract, while the rest is sold on the spot market, just like commodities such as oil and gold. Â
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(InfoWorld) - Samsung Electronics held onto its title as the world's largest producer of DRAMÂ memory chips in 2006 despite a late charge by Hynix Semiconductor, according to a study released Thursday. Hynix leapfrogged Qimonda, jumping into second place by posting a 31 percent increase in DRAM bit shipments from the third to fourth quarter, while the market as a whole grew by only 14 percent in that time, according to iSuppli. In 2006, Samsung claimed DRAM revenues of $9.5 billion, 28 percent of the entire $33.9 billion market, iSuppli said. Hynix followed with 16.6 percent market share, leading Qimonda's 15.9 percent, Micron's 11 percent, and Elpida's 10.4 percent. All other producers were in single digits. Hardware vendors use DRAM semiconductor memory in a vast range of products, including PCs, printers, hard disk drives, mobile phones, digital cameras, televisions, and game consoles. Although demand will keep growing, iSuppli says slumping prices in 2007 will take the wind out of those sails, pushing revenue down despite rising sales. The vendors are more optimistic. Qimonda predicts that demand could rise in 2007 because of Microsoft's launch of its newÂ Windows Vista OS as well as other communication and consumer applications, according to the company's Jan. 23 earnings report. Likewise, Samsung predicts that a strong consumer electronics market will push demand for DRAM used in 2.5G and 3G handsets and in game consoles. DRAM vendors also hope to continue momentum by relying on technology advances, planning to shrink their chip architecture from 90 nanometers to 80nm and below in the short term and toÂ upgrade from current DDR2 design to DDR3 in coming years. Despite its dominant position, Samsung suffered in December asÂ one of its executives agreed to serve jail time and pay a large fineÂ as the result of an investigation by the U.S. Department of Justice into price-fixing practices in the industry. The plea was the fifth from a Samsung executive and marked the 18th person from four vendors indicted since December 2003. The other companies charged were Hynix, Elpida, and Infineon (which has since spun off its DRAM division as Qimonda). Â
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LicenseWise and Windows Vista Hardware Assessment help users navigate Microsoft offerings.
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Demand for the Vista Windows system and other products helps Microsoft to profits of $3.03bn, up 11% on last year.
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With the release of Windows Vista, Microsoft Corp. raised the prices it charges retail customers for technical support related to the new OS and Office 2007.
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Dell, HP, and others launch souped-up PCs to support Windows Vista.
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Keeping spotty head above US$1 water The DRAM industry has seen DDR2 spot prices spike by 15-20 per cent in the past month, with eTT chips outpacing branded equivalents.â¦