Digital Daily » NAND

So Much for SamDisk

John Paczkowski — Fri, 04 Sep 2009 12:57:34 +0000

It was fun while it lasted, but Samsung has abandoned its bid to buy SanDisk. In a regulatory filing made nearly a year after its $5.85 billion offer for SanDisk (SNDK) was rejected as too low, Samsung officially called off the effort, which, had it been successful, would have combined two of the largest flash memory producers into a single NAND monstrosity that would have dominated the industry.

“We are no longer planning to pursue the acquisition as there has been no progress since we withdrew our offer as of Oct. 22, 2008,” the company said in a filing with the Korea Exchange. The announcement comes after the two companies inked a new seven-year NAND flash-memory license agreement, one that will see Samsung paying about half the royalty amount it paid previously.

Apple’s Half-Billion Dollar NAND Binge

John Paczkowski — Wed, 22 Jul 2009 14:55:03 +0000

Apple’s voracious appetite for NAND flash RAM has proven a boon to Toshiba. Discussing Apple’s latest earnings on a conference call with analysts Tuesday, company COO Tim Cook revealed that Apple and Toshiba have inked a flash memory deal worth half a billion dollars.

“We did a long-term supply agreement with Toshiba,” Cook explained. “As a part of that, as part of the terms and conditions, we paid them $500 million as a pre-pay earlier in the quarter. You know, we view Flash as a very key component for us because as you know we use it in so much on so many of our products and also we are a reasonable percentage of the user of Flash on a worldwide basis.”

Indeed, Apple (AAPL) sells millions of NAND flash-enabled devices each year, so many that its needs often constrain supply for the entire market. In 2005, the company arranged to purchase up to 40 percent of Samsung Electronics’ holiday NAND output for use in it iPods. In July of last year Apple bought 50 million 8Gb-equivalent NAND flash chips from Samsung, forcing the company to reduce its supply to other customers.

Then, this past April, Apple ordered 100 million 8Gb–or one-gigabyte (1GB)–chips from Samsung, once again causing flash supplies to tighten. Now we have this $500 million prepayment, which, according to sources, will keep Apple in NAND for about three months.

Great news for Toshiba, which has been suffering mounting losses in the midst of tougher competition, and for the NAND market as well. As Tim Cook said yesterday, “The NAND market has now begun to stabilize and we expect it to move towards a supply/demand balance.”

Apple to Manufacture Single 100 Million Gigabyte iPhone?

John Paczkowski — Thu, 09 Apr 2009 18:52:50 +0000

To the NAND flash memory business, Apple is a market maker and mover–and an increasingly insatiable one. The company first shook the NAND industry back in 2005 when it arranged to purchase up to 40 percent of Samsung Electronics’ holiday NAND output for use in it iPods. In 2008 it did so again, reportedly buying up 50 million 8GB-equivalent NAND flash chips from Samsung, an amount so large the company was forced to reduce its supply to other customers to fulfill its obligation to Apple (AAPL).

Now comes word that the company’s appetite has been renewed–and doubled. Industry sources tell DigiTimes that Apple has placed an order for 100 million 8Gb (1 gigabyte) chips from Samsung, an order so large it is reportedly causing a supply shortage. If correct, the DigiTimes report could lend a bit of credence to rumors of a low-end iPhone. Unless, of course, Apple plans to use them for something else entirely, (a single, massive 100 million gigabyte iPhone?)–also a distinct possibility.

Either way, contract prices for flash memory are likely to rise to unpleasant levels in the near future.

Apple Introduces NAND iShortage

John Paczkowski — Thu, 19 Feb 2009 15:07:37 +0000

The NAND flash memory supply may be headed for a bit of an early season drought thanks to Apple (AAPL). According to a new report from ThinkEquity Partners, Cupertino has bought up all of Samsung’s flash RAM inventory up to April 2009, presumably in preparation for an iPhone refresh. Samsung produces just over 40 percent of the world’s NAND Flash RAM, so we’re talking an awful lot of flash here–enough to cause part shortages and price increases across the entire RAM market. “Our checks indicate that Apple has started ordering for its iPhone refresh (iPhone and iPhone Nano), stifling the supply chain,” ThinkEquity analyst Vijay Rakesh told clients in a note. “We expect NAND spot and contract pricing to continue to trend up.”

Seems Apple’s not only reshaping the music and cellphone industries, but the memory industry as well.

Apple Takes Top Honors in Competitive NAND Eating Contest

John Paczkowski — Thu, 03 Jul 2008 12:16:30 +0000

Apple (AAPL) is to the NAND flash memory business what Starbucks (SBUX) is to the coffee business–a market maker and mover. Particularly a mover. The company first shook up the NAND market back in 2005 when it arranged to purchase up to 40 percent of Samsung Electronics’ holiday NAND output for use in it iPods.

And now it’s creating a bit of a stir again, this time thanks to the iPhone. Apple plans to buy 50 million 8Gb-equivalent NAND flash chips from Samsung. That’s an awful lot of NAND–so much, in fact, that the chip manufacturer has been forced to reduce its supply to other customers to fulfill its obligation to Apple.

Either way, this is ugly news for any Samsung customer not headquartered in Cupertino, Calif. That said, the deal’s impact on the NAND market could be a reduction in prices for all. Something to look forward to, after the drought, I suppose.