Memory chip makers will offer more sophisticated flash drives for smartphones--technology that will be comparable to the solid-state drives found in laptops today.
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The Palm Pre comes with an 8GB flash memory drive: flash drive makers like Micron Technology will market more sophisticated flash drives for future phones.
(Credit: Palm)Today's flash drives, which typically range up to 32GB in capacity in products like Apple's iPhone, often use relatively unsophisticated techniques for reading and writing data. In general, the technology is not very different from that used in basic cell phones or digital cameras, according to Brian Shirley, vice president of Micron's memory group.
But as smartphones--and possible future tablet devices--become more like personal computing devices and less like basic MP3 players, memory chip makers will begin offering more sophisticated flash memory, said Shirley, in a phone interview.
"In nearly all MP3 players today it's almost exclusively 'raw' NAND. And at some point we anticipate moving more to a managed NAND," Shirley said. NAND is the type of flash memory chip used in all flash cards and solid-state drives.
Managed NAND falls somewhere between very basic flash drives--such as Secure Digital, or SD, cards--and pricey solid-state drives (SSDs) used in laptops and servers. "It's something in between the raw NAND that we've been talking about for cell phones and MP3 players and the full-blown SSD space," Shirley said.
"We believe this will be fairly busy (market) space in 2010," he added.
Solid-state drives used in laptops like the Apple MacBook Air and Dell Adamo get their performance from highly-developed, sophisticated controller chips and firmware, which manage how the data is read and recorded. Though managed NAND wouldn't necessarily reach this level of sophistication, it would begin to approach it.
The iPhone uses raw NAND with a separate controller, according to Gregory Wong, founder and principal analyst at Forward Insights, which does research on flash memory technology.
"They like to have control over the flash and the controller so they can boost performance," he said. "They're very cognizant of differentiating their products. The user experience is what is important to them. Whether it means you can download your music or video very quickly, whether it means you can find the data very quickly--that ties in to how they manage the NAND," he said.
But even Apple is looking for better performance as it looks to continue its very successful strategy of making its products different, according to Wong.
And future Netbooks may also use this kind of flash memory. Netbooks today using Intel Atom processors and the Windows operating system use, almost exclusively, hard disk drives. But a new category of Netbooks dubbed smartbooks--devices that are always on, always connected, and boast all-day battery life--are expected to come to market in 2010 packing flash drives. These small laptops may be candidates for managed NAND.
Apple said Tuesday that it has made a $500 million prepayment to Toshiba for flash memory chips and indicated the market is stabilizing.
Apple COO Tim Cook says the flash memory market is stabilizing.
(Credit: Apple)"The NAND flash market has now begun to stabilize and we expect it to move to a slight demand imbalance," said Apple Chief Operating Officer Tim Cook in Apple's Tuesday earnings conference call. (The call is available as an audio Webcast on Apple's Web site.) The news was reported earlier by Reuters.
"In terms of the Toshiba prebuy, we did a long-term supply agreement with Toshiba, as a part of that, as a part of the terms and conditions, we paid them $500 million," Cook said. "We view flash as a very key component for us because we use it in so many of our products and also we're a reasonable percentage of users of flash on a worldwide basis."
NAND flash is used for data storage in a variety of consumer products including digital media players and smartphones, such as the iPod and iPhone, respectively. For the last two years, flash chipmakers such as Japan-based Toshiba and U.S.-based Micron Technology have been reeling from severely depressed flash memory pricing.
Intel, which makes flash chips jointly with Micron, is also seeing a recovery in pricing. "For the year, it's up over 50 percent," said Troy Winslow, marketing manager for the NAND Products Group at Intel, in a phone interview earlier this week. He was speaking about the recovery in flash memory chip prices in the spot market. "That's been very positive for the industry and obviously we have benefited from that. And our business is going very well," he said.
Even with the better spot market pricing for flash memory--which is a boon for manufacturers--this won't necessarily translate into a jump in prices for consumers, according to Avi Cohen, managing partner at Avian Securities. "If the question is--will components (flash chips) cost 50 percent more than they did three months ago? Absolutely not," he said.
Solid-state drives may see heady growth despite a sliding world economy, according to a report released Tuesday by a market research company. Devices like the Apple iPod and iPhone are expected to drive growth.
Micron Technology along with its partner Intel are challenging SSD market leaders Samsung and Toshiba, In-Stat said
(Credit: Micron)Flash memory revenue in the solid-state drive segment will see compound annual growth rates of over 100 percent through 2012, according to market research firm In-Stat. The type of flash used in solid-state drives is referred to as NAND flash.
"You're starting from quite a small base. Back in 2006, you're in the tens of millions (of dollars) kind of a number. By 2012, you're easily over five billion. So the growth rates do get rather high," said Ian Lao, a senior analyst at Scottsdale, Ariz.-based In-Stat. The market researcher forecasts compound annual growth at 106 percent from 2006 through 2012, Lao said.
In the consumer segment, Lao says he expects to see most of the growth in small devices like portable music players and smart phones. Music players such as the Apple iPod and Microsoft Zune will adopt solid-state drives instead of the tiny 1.8-inch hard disk drives they use now because of better durability and shock resistance. "They suffer the risk of, hey, I just dropped my Zune, it doesn't work anymore," Lao said. SSDs will provide much greater reliability, he said.
And as smart phones become more PC-like, they will graduate from relatively simple flash drives to more sophisticated SSDs with the same Serial ATA (SATA) interfaces used in PCs today, Lao said. An iPhone, for example, with a more computer-like operating system and features would use an SSD, Lao said.
Future ultra-portable laptops, represented today by the MacBook Air and HP Voodoo Envy 133, will also drive SSD growth, as will Netbooks.
Sharp growth will also be seen in the corporate enterprise market. SSDs will, in an increasing number of cases, replace very-high-speed hard disk drives in server environments, Lao said.
Flash drives (non-SSD) will remain widely used in various music players, mobile handsets, after-market cards, and USB flash drives, with a combined market share of more than 80 percent during the next couple of years, according to the report. However, this percentage will drop to about 70 percent by 2012, as SSDs grow in importance, the report said.
Worldwide NAND flash revenues are likely to grow at a compound annual growth rate of 29.7 percent from 2007 to 2012 to reach $61 billion, In-Stat said. Revenues for NOR flash--used, for example, to store program code in cell phones--will increase at a 6 percent compound annual growth rate from 2007 through 2012.
Updated at 7:15 p.m. PST with additional information from earnings conference call.
Memory chipmaker Micron Technology posted its eighth-straight loss as it was hit by a steep drop-off in chip prices caused by global oversupply.
In the quarter ended December 4, 2008, the Boise, Idaho company posted a net loss of $706 million or 91 cents per diluted share, on net sales of $1.4 billion, down 8.7 percent. Analysts surveyed by Bloomberg had forecast a loss of 45 cents a share.
The 2009 fiscal first quarter results include a $369 million write-down of memory chip products, Micron said.
The largest U.S. manufacturer of memory chips said it saw steep drops in the average selling prices for its DRAM and NAND Flash memory products, which dove 34 percent and 24 percent respectively. DRAM is used as the main memory in PCs. Flash is used for storage in digital cameras, digiital music players, and solid-state drives.
As a result, sales of memory products fell 4 percent from the previous quarter due to "significant decreases in market selling prices for the company's products," Micron said. Sales, however, measured in gigabits, increased 35 percent for DRAM and 40 percent for NAND flash memory.
Micron said anticipated capital expenditures for fiscal 2009 have been revised downward from last quarter's "guidance" of between $1 billion and $1.3 billion to between $650 million and $750 million.
Micron Chief Executive Officer Steve Appleton also addressed the global memory chip production situation in the earnings conference call. "Most of the (memory chip) companies have announced in the neighborhood of 20 percent, 30 percent," he said referring to year-end production capacity cuts. Appleton cited Hynix, the second largest memory chip manufacturer, which is cutting capacity 30 percent.
"The rate at which capacity comes back online will be determined by what the demand profile is through the first half of '09," he said.
He added that chip production equipment vendors may face a dire 2009. "If you talk to the equipment guys, they will tell you that they may not have any business in '09 in certain categories."
Speaking to the possible bailout of the Taiwan memory chip industry, Appleton said that this money is not likely to increase capacity (i.e., increase supply) because most of the money would simply go for things like debt relief, not necessarily to build new capacity.
During the quarter, Micron announced plans to cut its global workforce 15 percent through 2010 and slashed NAND flash production at a joint venture with Intel by approximately 35,000 (200 millimeter) wafers per month.
Micron currently has about $1 billion in cash and short-term investments.
The newest solid-state drives are just starting to hit retail. But would you buy one?
Intel X25-M solid-state drive has received glowing reviews for its performance
(Credit: Intel)Solid-state drives are attractive because they're generally faster than hard-disk drives, particularly at reading data--generally something PC users spend most of their time doing.
But price is still an obstacle, especially to the frugal consumer.
Sunnyvale, Calif.-based OCZ Technology is now offering some of the most competitively priced solid-state drives based the high-speed Serial ATA (SATA) II interface.
OCZ Vertex SSD drives start at $129 for a 30GB SSD. Other capacities include a 120GB drive for $469 and a 250GB SSD for $869. Though $869 may seem pricey compared to a 7200RPM 250GB hard-disk drive that can retail for well under $100, it's relatively cheap for a large-capacity SSD. In the past, SanDisk had sold a 256GB drive through resellers that was priced, almost incredibly, at more than $15,000. Axiom had been selling 256GB solid-state drives priced above $6,000.
OCZ says the Vertex Series of SSDs have a 1.5 million-hour mean time before failure (MTBF), "ensuring peace of mind over the long term." Solid-state drives, since their inception, have been plagued by doubts about write durability. SSD manufacturers such as Intel, Micron Technology, and Samsung say long-term durability is no longer an issue.
The OCZ drives are backed by a two-year warranty.
Intel's X25-M SATA solid-state drive is now widely available at retail. An 80GB X25-M is priced at just more than $500 at most retailers. Reviews of the X25-M's performance have been very positive.
Unfortunately, the only way to get the newest SSDs in some cases is by ordering a laptop. Samsung is now offering its latest-and-greatest 128GB SATA drives in ultraportable laptops such as the MacBook Air and the Dell Latitude E4200 and E4300.
The Latitude E4300 can be configured with a 128GB SSD for $460 more than the standard 160GB 5400RPM hard disk drive.
Intel will target solid-state drives for server computers in a tie up with Hitachi that was announced Monday night.
Intel solid state drive
(Credit: Intel)Intel and Hitachi Global Storage Technologies (Hitachi GST) said they will "jointly develop and deliver" Serial Attached SCSI (SAS) and Fibre Channel (FC) solid-state drives (SSDs) for servers, workstations, and storage systems.
While Hitachi is a large supplier of hard disk drives, Intel manufactures and sells consumer and enterprise-class solid-state drives (and the flash memory chips inside the drives). The enterprise-class X25-E Extreme SSDs that Intel offers now are based on Serial ATA (SATA) technology. As are its consumer-class drives.
Solid-state drives are generally faster than hard-disk drives, particularly at reading data.
"The combination of a leading Enterprise drive supplier with a NAND technology and manufacturing leader will produce world-class solutions in terms of reliability, performance and system compatibility," the companies said in a statement.
The agreement is exclusive to the two companies with the first Serial Attached SCSI and Fibre Channel products expected to be available in early 2010. Both Serial Attached SCSI and Fibre Channel are interfaces typically used in servers.
The companies said the SSDs will not replace hard disk drives but complement them. "The new generation of solid-state drive technology complements existing enterprise-class hard disk drives and is intended for use in storage applications that require extremely high Input/Output Operations Per Second (IOPS) performance and power efficiency," according to the two companies.
Hitachi GST said it will continue to provide its customers with both "traditional" hard-disk drives in addition to the SSDs.
The new SSDs will be "branded and exclusively sold and supported by Hitachi GST" and use Intel NAND flash memory and SSD technology.
Hitachi said it will use its expertise in drive firmware, reliability, qualification and system integration in combination with Intel's technology and manufacturing capabilities.
Micron Technology will bring out a 256GB solid-state drive early next year while it moves, along with Intel, to a new manufacturing process.
Micron SSD
(Credit: Micron)A Micron representative said Monday that the company will start volume production of a 256GB solid-state drive for consumer use in March 2009.
This follows Samsung's announcement last week that it had begun mass-producing 256GB solid-state drives.
The Micron RealSSD C200 will read data at 250MBps (megabytes per second) and write at 100MBps. It is sampling to customers now. Samsung, by comparison, is claiming sequential read rates of 220MBps, with sequential write rates of 200MBps.
The Micron representative said that the company is slightly behind schedule in delivering the 256GB product, as it was originally targeted for the fourth quarter of this year.
Solid-state drives are generally faster than hard-disk drives, particularly at reading data. Computer makers such as Apple, Hewlett-Packard, Dell, and Toshiba all offer laptops with solid-state drives ranging in capacity from 64GB to 128GB.
Intel is due to deliver a 160GB solid-state drive this quarter. The chipmaker is currently shipping 80GB solid-state drives to customers such as Hewlett-Packard, which offers it in its EliteBook 2530p ultraportable.
In related news, as reported back in May, Micron and Intel announced mass production Monday of their jointly developed 34-nanometer, 32-gigabit multilevel cell NAND flash memory device.
The "32Gb monolithic die will give us the ability to cost-effectively produce over 300GB-capacity SSDs in standard 2.5-inch and 1.8-inch form factors," Intel said Monday.
Multilevel cell technology allows makers of solid-state drives to deliver lower-cost devices at higher capacities.
The new Micron 256GB drive will not be based on the 34nm process, however. Drives based on this process will come out later in 2009.
Intel and Micron have a joint NAND flash memory venture, IM Flash Technologies (IMFT), which manufactures the NAND chips. The two companies market the products separately.
The companies "are ahead of schedule with 34nm NAND production" and expect their Lehi facility to have moved more than 50 percent of its capacity to 34nm by year's end, according to a statement.
"The results from IMFT continue to exceed our expectations," Randy Wilhelm, vice president and general manager, Intel NAND Solutions Group, said in a statement.
In October, Intel and Micron said they would discontinue supply of NAND flash memory from Micron's Boise facility. The NAND operation shutdown will reduce IMFT's NAND flash production by approximately 35,000 (200-millimeter) wafers per month, Micron said at the time.
Samsung on Wednesday night said it has begun mass-producing 256GB solid-state drives. This size tops the largest-capacity SSDs found in laptops today.
Samsung currently offers 64GB and 128GB SSDs for laptops.
The new 256GB drives are faster too, the company claims, more than doubling the performance rate of Samsung 64GB and 128GB SSDs.
The drives combine sequential read rates of 220 megabytes per second, with sequential write rates of 200MBps. "This sharply narrows the performance gap between read and write operations to only 10 percent, compared to a read-write speed difference of between 20 (percent) and 70 percent for other SSDs," the company said.
Samsung did not mention random write performance, however. Despite being generally faster than hard-disk drives (particularly at reading data), solid-state drives fall short of hard disks when they randomly write data. Random writes are generally considered to be the Achilles' heel of solid-state drives.
Getting this 256GB SSD in a notebook "is analogous to having a 15,000-(revolutions-per-minute) drive, without all of its size, noise, power, and heating drawbacks," Jim Elliott, vice president of memory marketing at Samsung Semiconductor, said in a statement.
The 256GB SSD boosts data transfer when large multimedia files are simultaneously read and stored. "It can store 25 high-definition movies in just 21 minutes, a significant advancement over a 7,200rpm hard disk drive (HDD), which takes about 70 minutes," the company said in a statement.
The drive's performance is derived from a new single-platform design consisting of a chip controller, NAND flash, and special drive firmware developed by Samsung. "This single platform is designed to easily adapt to Samsung's 40-(nanometer) class NAND flash memory," according to the company.
It consumes 1.1 watts of power, versus 2 or more watts for a comparable HDD. Similar in weight to a 128GB SSD, at 81 grams, the 2.5-inch multilevel cell 256GB SSD has the same 9.5-millimeter drive thickness.
Samsung's 256GB SSD is also available with optional proprietary encryption programming that provides full-disk encryption, a key feature for some corporate users.
Pricing was not immediately available.
After cutting executive pay last week, Micron Technology is now paring staff as it scales back flash memory chip production.
On the heels of reporting a $344 million fourth-quarter loss last week--when Micron said it was cutting executive pay 20 percent--the Boise, Idaho-based memory chip maker said Thursday that it was restructuring its memory operations.
Micron will reduce its global workforce by approximately 15 percent during the next two years. Most of the workforce cuts will occur in Boise.
"The combination of declining customer demand and product oversupply in the marketplace has driven selling prices for NAND flash memory significantly below manufacturing costs," Micron said in a statement.
As a result, IM Flash Technologies (IMFT), a joint venture between Micron and Intel, will discontinue the supply of NAND flash memory from Micron's Boise facility. The NAND operation shutdown will reduce IMFT's NAND flash production by approximately 35,000 (200 millimeter) wafers per month, Micron said.
NAND flash is used in flash drives for digital cameras and digital music players as well as solid-state drives.
Micron and Intel have other facilities that make NAND flash, including one in Lehi, Utah.
"Micron is in a strong position relative to our competitors...but we are not immune to the difficult global market conditions that are affecting us all," said Micron CEO Steve Appleton in a statement.
Cash restructuring and other related expenses are anticipated to be approximately $60 million and "next year's cash operating margin benefit is expected to exceed $175 million," Micron said.
Last week's red ink was Micron's seventh straight quarterly loss--and it reported a net loss for the entire 2008 fiscal year of $1.6 billion.
The memory chip industry overall is caught in a particularly brutal downward price spiral that is threatening the viability of even the largest players, including companies like Hynix.
Micron's earnings pain will pass directly to executives. Micron Technology attributed a $344 million loss in the fourth quarter to a cratering memory market and said it would slash executives salaries as a result.
This was Micron's seventh straight quarterly loss. The largest memory chip manufacturer in the U.S. reported a net loss for the entire 2008 fiscal year of $1.6 billion, or $2.10 per diluted share on net sales of $5.8 billion.
Executives will feel the pain. "We are implementing a 20 percent reduction in salary compensation for Micron senior executives," Steve Appleton, Micron's CEO, said in a statement. "The global memory market continues to experience severe oversupply and price degradation, and it remains a challenging period for all of us competing in the industry."
Amid the dire market conditions, Micron said it would "diligently work...to ensure the competitiveness and long-term success of the company."
Sales of memory products in the fourth quarter decreased 4 percent compared with the third quarter. Sales of DRAM products decreased slightly compared with the preceding quarter, the company said.
For NAND flash memory products, sales decreased 10 percent, compared with the prior quarter, due to a 20 percent drop in the average selling price. Micron is a major manufacturer of flash memory and recently launched a line of solid state drives that will reach 256GB in capacity this year.
Micron is also in a flash chip manufacturing joint venture with Intel--IM Flash Technologies--that fabricates chips for both Micron's and Intel's solid state drive lines, among other products.
One bright spot: Sales of CMOS (complementary metal-oxide-semiconductor) image sensors in the fourth quarter of fiscal 2008 increased slightly compared with the third quarter and represented 12 percent of the company's total sales in the fourth quarter, Micron said.
