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Reviewing global/Indian semicon industry in 2008 — top posts

January 3, 2009 Comments off

Greetings, dear readers and friends, in the new year. May you all have all the success and prosperity in 2009!

An eventful year in semiconductors has passed by us. For me, personally, it has been a tremendous 2008, ending with Electronics Weekly of UK selecting my blog (Pradeep Chakraborty’s Blog) as the world’s best in the Electronic Hardware category.

Lot of people have asked me since, how it feels to be a world champion! Well, I do feel elated! However, one point, more of the congratulatory notes have come from overseas, than from India. Perhaps, it is an apt indicator of how semiconductors is perceived in India — though, I may be wrong.

Friends have also asked me how I’ve managed to blog on such a difficult subject sitting in India. Simply put: It has not been easy!

First, I’m just a simple person, and not some brand name. Second, my blog does not represent any large, well known media house, or a big brand semiconductor magazine. Hence, maintaining a semicon blog, with the help of contacts from all over the world has been tough, at times. Why, some folks, with whom I wished to speak with, never even responded to my emails and requests. Quite understandable!

Third, I’ve only managed to blog, when I have the time, unlike many other great bloggers who post regularly (or daily)! Fourth, there have been several instances, where my location has been my weak point. I was unable to blog on several instances simply because I had no way of reaching people whom I wished to speak with, while sitting in India. And, as I said, I did get cold snubs on several instances! 🙂 As a result, I could not present my views at specific instances, even though I dearly wanted to!

However, the unconditional and loving support and encouragement of my family, friends, well wishers, industry leaders and loyal readers such as you have helped overcome all of these deficiencies. It is only because of these people that I’ve managed to come this far! I hope each one of you continues to have faith in me. I shall try my best to provide you with the best information (hopefully) the global semiconductor industry has to offer.

To start off the new year, may I present, what I feel, are the top blog posts on semiconductors during 2008, as a review for the past year.

Being indisposed at the start of 2008, I only managed to pick up speed from April onward. As the year progressed, the Indian fab story with SemIndia started worsening, before finally disappearing, even as fabless India held on sttong, as did the fortunes of the global semiconductor industry, which incidentally, did look quite good till September last year.

I have arranged the blog posts, from January to December 2008, so they will present a better picture of how 2008 behaved! These posts are set in no particular order or preference, otherwise. Some of you may have your own favorites, so kindly let me know, in case those haven’t made the list.

JAN 2008
Power awareness critical for chip designers
LabVIEW 8.5 delivers power of multicore processors

MAR 2008
NXP India achieves RF CMOS in single chip
VLSI as a career in India
Using ‘semicon’ simulation for drug discovery

APR 2008
New camps promise exciting times ahead in memory market
Indian design services to hit $10.96bn by 2010
Staying ahead of clock a habit at Magma!

MAY 2008
Dubai — an emerging silicon oasis
Developers, go parallel, or perish, says Intel
Think AND not OR; Altera first @ 40nm FPGAs
Top 10 global semicon predictions — where are we today
Semicon to grow 12pc in 2008
India’s growing might in global semicon

JUN 2008
10-point program for Karnataka semicon policy
Has the Indian silicon wafer fab story gone astray?
Semicon half year over, what next now?
EDA as DNA of growth

JUL 2008
Semicon is no longer business as usual!
Cadence C-to-Silicon Compiler eliminates barriers to HLS adoption
Practical to take solar/PV route: Dr. Atre, Applied

AUG 2008
What India brings to the table for semicon world! And, for Japan
NAND update: Market likely to recover in H2-09
E Ink on every smart surface!
RVCE unveils Garuda super fuel-efficient car
Indian fab policy gets 12 proposals; solar dominates

SEP 2008
90pc fab investments for 300mm capacity: SEMI
Synopsys’ Dr Chi-Foon Chan on India, low power design and solar
Magma’s YieldManager could make solar ‘rock’!
Motion sensors driving MEMS growt
BV Naidu quits SemIndia; what now of Indian fab story?

OCT 2008
Top 20 global solar photovoltaic companies
IDF Taiwan: Father of the Atom an Indian!
TI Beagle Board for Indian open source developers and hobbyists
Cadence’s Virtuoso vs. Synopsys’ Galaxy Custom Designer!
Synopsys’ Galaxy Custom Designer tackles analog mixed signal (AMS) challenges
Solar, semi rocking in India; global semi recovery in 2010?
No fabs? So?? Fabless India shines brightly!!

NOV 2008
AMD’s roadmap 2009 provides lots of answers… now, to deliver!
Embedded computing — 15mn devices not so far away!
FPGAs have adopted Moore’s Law more closely!

DEC 2008
My blog is the world’s best!
Semicon outlook 2009: Global market could be down 7pc or more
Altera on FPGAs outlook for 2009
Solar sunburn likely in 2009? India, are you listening
Outlook for solar photovoltaics in 2009!

I found it difficult to select the Top 10 posts. If any one of you can draw up such a list, it’d be great!

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Semicon outlook 2009: Global market could be down 7pc or more

December 18, 2008 Comments off

Friends, I’ve just got off a very interesting, but predictable, webcast on the outlook for the global semiconductor industry organized by Semiconductor International.

The news coming out of this webcast is not very good for the industry. And as the moderator commented toward the end, I’d say too, “I hope these guys are all terribly wrong!”

All of the experts, as listed below, have predicted a dismal 2009 for the global semiconductor industry, starting from a negative 7 percent or more!

For everyone’s information, the participating experts at the webcast were:

* Moshe Handelsman, President, Advanced Forecasting Inc.
* Aida Jebens, Senior Economist, VLSI Research Inc.
* Carl Johnson, Executive Director, Research Infrastructure.
* Dale Ford, Senior Vice President, Market Intelligence, iSuppli Corp.
* Lara Chamness, Senior Market Analyst, Industry Research and Statistics, SEMI.

So, the key question: What is the global semiconductor industry going to look like in 2009?

Semicon -7pc down in 2009 or more?
VLSI Research’s Aida Jebens said that they are pegging electronics as either flat or negative for 2009. The semiconductor market would be down 7 percent as well. It could be worse, she added, depending on how the November and December 2008 numbers come out to be!

iSuppli’s Dale Ford was cautious, given that the firm has not yet announced its forecast publicly. (I’ve discussed the industry at length earlier, with Dale Ford.) As for guidance, he said that iSuppli sees the electronic equipment market declining roughly in the 1pc range.

With regard to semiconductors, iSuppli had given some interim guidance with the industry turning down 9.4 percent. He added that in iSuppli’s final forecast, it could be more negative, although, not double digit negative. However, he added, “We do see growth coming down nearly to that range.”

Handelsman from Advanced Forecasting, added that while his company’s policy was not to divulge the exact numbers, except to their clients, he provided insights that there will be decline for ICs in revenues, which will be larger than 2008. Regarding equipment, the decline will be significantly larger than what other sources believe it will be. This is quite discouraging, folks!

Research Infrastructure’s Carl Johnson, while calling numbers as a moving target, provided some guidance as well. According to him, the electronics equipment sales will be down, close to 10 percent.

Even the IC sales will be down, close to the 15 percent range. In the capital equipment business, the numbers are not going to be good either. Johnson said that it could probably be at least a 30 percent decline in 2009. There are also chances that the industry might even approach the numbers that it reached during the downturns in the mid nineties!

Finally, SEMI’s Lara Chamness, closed in on the outlook for semiconductor equipment and materials. According to her, for semiconductor equipment, 2009 will definitely be a negative year, somewhere around -22 percent! For semiconductor materials, SEMI is looking at -1 percent decline in 2009.

Tough times ahead for solar?
There’s a bit more than this to add in this blog, especially on the analysts take on solar.

Maybe, those investing in solar, in India, need to see this as well, and take all of the necessary steps, if required. With the kind of financial crisis that we are currently in, people are definitely going to have problems getting credit.

According to VLSI Research’s Aida Jebens, there could be a tough time for solar in 2009. It will pick up, but not in the next two years.

Right then folks, that’s all for now! You have seen the numbers that will matter! I shall try and update this outlook 2009 report on semiconductors sometime later!

Global semicon could decline by over 5pc in 2009!

December 4, 2008 Comments off

The year 2008 will soon be relegated to history, albeit with the dubious distinction of handing out an extremely unforgettable year for the memory chip makers!

This trend was starkly evident, as a major downturn in this segment caused revenue to fall for nearly all suppliers and contributed to negative results for the overall semiconductor industry, according to recently released preliminary market-share figures from iSuppli Corp. (The memory market is being dealt with in the next blog!)

The key question remains as to whether the semicon industry has really lost the money-making ability? According to Dale Ford, senior vice president, market intelligence services, for iSuppli, the semiconductor industry goes through cycles of revenue growth and profitability. He says, “It would not be correct to extrapolate the current challenges of the semiconductor industry and say that the industry has “lost its money-making ability.”

iSuppli expects that the the industry will experience some level of restructuring during this downturn that will help it emerge to renewed revenue growth and profitability.

Revenue to drop 2 percent
Given the current scenario, it is taken for granted now that the global semicon revenue will likely decline in 2008. Ford says: “iSuppli predicts that the semiconductor industry will decline by 2 percent in 2008. However, it is possible for the decline to worsen as more companies revise down their fourth quarter guidance.”

The primary reasons for the decline are the over supply of memory ICs and resulting steep price declines and the global financial/economic crisis that has impacted consumer spending and the production of electronic equipment.

Fabless flies high
Coming down to the top 20 semiconductor suppliers (see table above), it would be interesting to see how the fabless companies have fared overall.

Ford says that Qualcomm, Broadcom and nVidia are predicted to be the only fabless companies in the top 20 semiconductor suppliers in 2008.

“Qualcomm and Broadcom are expected to see their revenues grow by 19.6 percent and 26.4 percent, respectively. Only nVidia is expected to see a decline in revenues with a projected contraction of 0.5 percent,” he adds.

There are some non-memory players in the top 20, who have registered declines. While it is not possible to comment on every single company, Ford mentions that the declining revenues are due to a variety of factors, including divestiture of business units, declining markets, and lost market share.

Fab spend and outlook 2009
Critically, there is a need to also see how the fab spends are looking like in 2009.

According to SEMI’s recent World Fab Forecast, spending on fab construction projects in 2008 is likely to decline by 41 percent year-over-year (YoY), as projects are pushed out or put on hold. In 2009, the Americas and Japan are expected to be the only regions with positive growth rates for construction spending.

Ford adds, “Currently, we see fab spending declining significantly in 2009.”

Overall, what’s the outlook going to be like for the global semiconductor industry in 2009! Ford concludes: “We have not released a formal forecast to the press at this time. However, I will say that we expect the semiconductor market to decline by more than 5 percent in 2009.”

On possible Samsung-SanDisk deal; AMD’s fab-lite path

September 6, 2008 Comments off

Last week, the global semiconductor industry has been hearing and reading about two big speculative stories:

a) A possible acquisition of SanDisk by Samsung, and
b) A possible chance of AMD taking the fab-lite route.

First on Samsung’s buyout (possible) of SanDisk! There have been rumors of a possibility of Samsung acquiring SanDisk. While it is still a possibility, it also leads to several interesting questions!

Should this deal happen, what will be the possible implications for the memory market? Will this also lead to a possible easing off on the pricing pressures on the memory supply chain? And well, what happens to the Toshiba-SanDisk alliance?

A couple of weeks back, iSuppli, had highlighted how Micron had managed to buck the weak NAND market conditions, and was closing the gap with Hynix in Q2, and that NAND recovery was likely only by H2-2009.

I managed to catch up again Nam Hyung Kim, Director & Chief Analyst, iSuppli Corp., and quizzed him on the possible acquisition of SanDisk by Samsung.

A caution: Remember, all of this is merely based on speculation!

On the possibility of Samsung’s takeover of SanDisk, he says: “Samsung at least said that they consider it. Thus, it is a possible deal. But who knows!”

Kim is more forthright on the implications for the memory market, should this deal happen, and I tend to agree with him.

Consolidation inevitable; no impact on prices
The chief analyst quips: “The NAND flash market is still premature and there are too many players in flash cards, USB Flash drives, SSD, etc. The industry consolidation should be inevitable in future.”

So, will this possible buyout at least ease some pricing pressures on memory supply chain? “I don’t expect this deal to impact the prices. Prices will depend on suppliers’ capacity plans. In the memory industry, the consolidation has never impacted the prices in a long run. (maybe, just a short-term impact). As you know, Micron acquired Lexar a few years ago, but no impact,” he adds.

Is there any possibility of SanDisk delaying its production ramps and investments at two of its fabs? And, what will happen should it do so?

Nam says: “SanDisk has already said that they would delay its investment and capacity plan given difficult market condition. This is a positive sign to the market as we expect slower supply growth than expected in future. However, in a long run, consolidation won’t impact the market up and down.”

Negative impact likely for Toshiba?
Lastly, what happens to the SanDisk-Toshiba alliance, should the Samsung buyout of SanDisk does happen?

Nam adds: “It is negative to Toshiba. The company [Toshiba] not only loses its technology partner, but also loses its investment partner. It should be burden for Toshiba to keep investing themselves to grow its business.”

Well, in SEMI’s Fab Forecast Report, there is mention of how Toshiba and SanDisk are among the big spenders in fabs, in Japan. Considering that Japanese semiconductor manufacturers are more cautious, it would be interesting to see how this deal, should it happen, affects the Toshiba-SanDisk alliance.

Now, AMD goes fab-lite?
While on fabs, this brings me to the other big story of last week — of AMD going the fab-lite route, possibly!

Magma’s Rajeev Madhavan had commented some time back that fab-lite is actually good for EDA. It means more design productivity. Leading firms such as TI, NVIDIA, Broadcom, etc., are Magma’s customers.

Late last year, Anil Gupta, MD, India Operations, ARM, had also commented on some other firms going fab-lite! Gupta pointed out Infineon, NXP, etc., had announced Fab-Lite strategies. Even Texas Instruments was moving to a Fab-Lite strategy. “IDMs are going to be the fabless units of today and tomorrow,” he added.

So much for those who’ve taken the fab-lite route, and industry endorsements.

On the fab-lite subject, iSuppli’s Kim will not speculate whether AMD would actually break up into into two entities: design and manufacturing, and also prefers to wait and watch.

How does fab-lite actually benefit? He comments: “Fab-lite has not been working well in the memory industry, which requires very tight control. It works, IF two companies (an IDM and a foundry) work very closely. For example, the industry leader, Samsung, produces all of the memory alone without any foundry relationship.”

Watch this space, folks!

Semicon to grow 4-8pc in 2008; ASPs trending up

September 2, 2008 Comments off

It has really been a tumultuous year for semiconductors, which has held up very well, despite the memory market turmoils, so far.

Just a day ago, Future Horizons reported on the June sales for semiconductors. According to Malcolm Penn, chairman and CEO, June’s WSTS results brought both good and bad news! The good news being that the recovery momentum strengthened, with Q2 sales up 3 percent on Q1.

He says, “This was significantly better than even we dared to predict in last month’s Report, despite the fact we raised eyebrows and disbelief by suggesting a 2.3 percent quarter on quarter growth.”

The bad news was the Jan-May YTD WSTS numbers for standard logic (and thus, the total ICs and total SC) were revised downwards by a sizeable US$1.4 billion, a restatement that will knock 2 percentage points off the 2008 year on year growth number!

What were the reasons for the recovery momentum to have strengthened, with Q2 sales up 3 percent on Q1? Penn adds: “The first half year sales were much stronger than everyone (except us) believed. It has depresses, only by memories.”

Also, the Jan-May YTD WSTS numbers for standard logic (and total ICs and total SC) were revised downward by a sizeable US$1.4 billion. Why did this happen? It is interesting to note that one company mis-reported its sales for Jan-May and corrected this reporting error in June.

Penn adds: “This often happens, but not before at this magnitude. Individual company details are secret, so we do not know who the culprit was or how the ‘error’ happened.”

Forecast revised to 4-8 percent
Future Horizons further says in its report that the downward revision in standard logic numbers would knock 2 percentage points off the 2008 year on year growth number. On quizzing, Penn agrees: “Yes, our ‘revised’ forecast range is 4-8 percent. We are currently still erring on the high side of this range. More important though is the market momentum.”

Memory has been a constant problem this year. iSuppli has mentioned in an earlier report that NAND recovery will be likely in H2-2009.

DRAMeXchange, in another report today, indicates a new record low for DDR 1Gb. Even Penn agrees that recovery is definitely not in sight. When do we actually get to see some recovery? He adds: “There is still over capacity, however, Q3 is typically the strongest demand quarter.”

Still on memory, does Future Horizons forsee Hynix bouncing back? Penn says: “They did; in 2000-02, they were on the verge of bankruptcy. Now, they are fitter and financially strong.”

ASPs were trending up earlier, and the status quo is maintained. “ASPs are still trending up, slowly, but surely. We will be commenting more on this in September’s report,” he adds.

Fab spends trending down
Just a few days ago, a SEMI analyst highlighted the chief reasons for decline in fab spends. Christian Gregor Dieseldorff, Senior Manager of Fab Information and Analysis at SEMI, said: “Given the weaker economic conditions globally, coupled with higher energy and commodity prices and the financial crisis, the overall outlook for semiconductor growth in 2008 is for low-single digit growth in both revenues and units. As such, device makers have responded by cutting back their capital spending and pushing out fab projects or putting them on hold.”

On the status with fab spends, Penn agrees, “Those are still trending down, and will continue to do so for at least the next three quarters.”

Solar not much help
There have been lot of investments happening in solar/PV. One may imagine that all of this would be helping the global semiconductor industry. So, is the spend in solar/PV really helping the industry? Penn disagrees, saying this only helps the equipment guys.

One last query, and this is regarding the smaller IDMs, ‘fab-lite’ IDMs, and fabless semiconductor companies. Are they growing at below average? Penn concludes: “They are mostly not. The fabless firms outgrew the market 2x in the first half of 2008.”

Perhaps, here also lies a message for India!! One hopes that India does not get too carried away by all those investments in solar/PV, and focuses more on the semicon side. Semicon in India, does need concrete planning, after all!

NAND update: Market likely to recover in H2-09

August 20, 2008 Comments off

iSuppli’s recently published a report on the current NAND market conditions, which highlighted that Micron had managed to buck the weak NAND market conditions, and was actually closing the gap with Hynix in Q2 2008.

To find out more about the global NAND Flash market scenario, I managed to discuss the health of the NAND market conditions, performance of certain companies, and the possible impact of SSDs on the NAND market, in depth with Nam Hyung Kim, Director & Chief Analyst, Memory, for the market research firm, iSuppli Corp., El Segundo, Calif., USA.

I would also like to thank Jonathan Cassell, Editorial Director and Manager, Public Relations, iSuppli, for helping me out a lot! Without his assistance, this would not have been possible! Many thanks.

Now on to iSuppli and the NAND update. First up, NAND continues to be weak. How much longer, before we can see some sort of recovery?

Nam Hyung Kim says that the NAND market conditions will depend on the suppliers’ manufacturing capacity plans and on the global economy. The health of the NAND flash market is largely determined by consumer spending, since more than 85 percent of demand for the memory is generated by consumer-electronics-type products like digital still cameras, mobile handsets and flash storage devices.

“Market conditions won’t improve much this quarter. However, iSuppli Corp. does expect NAND prices to stabilize to some degree during the fourth quarter due to a slowdown in certain suppliers’ capacity expansion plans. A major recovery is expected in the second half of 2009,” he says.

So, what’s the reason for Micron to have done better in a weak market scenario?

According to Kim, Micron is doing well based on market share and sales growth—but not in terms of profitability. Micron has been expanding its market share by ramping up production aggressively. The company joined the flash market later than its competitors and is trying to catch up. In the memory world, a supplier needs to have critical scale. Without scale, the company won’t be competitive. Thus, Micron is increasing its scale—i.e., its volume—to be more like the size of the top-three suppliers at this moment.

If Micron has been aggressive, why haven’t the others? Possibly, the others could have also planned or migrate to 34nm! However, except for Samsung, all of the suppliers are losing money in their NAND businesses now.

“Each supplier has a different product mix and strategy, so being aggressive during tough times is not a suitable approach for certain firms. Others also plan to migrate their process to sub 40 nanometers. However, Micron will be the first one that produces 34nm products this year,” adds Kim.

iSuppli has now cut its 2008 NAND annual flash revenue growth forecast from 9 percent to virtually zero. When the slowdown had already been predicted during the end of last year, what was the need to cut predictions?

Kim agrees that this is indeed the second cut this year. “We cut our forecast early this year to 9 percent, which was a dramatic reduction from the more than 20 percent growth forecast previously. I believe, we were the first research firm that cut the market growth dramatically this year, followed by other research firms.

“The NAND flash market is relatively new and has lots of growth potential. However, oversupply issues, along with weak consumer spending, prompted us to cut the growth outlook further this time.”

Coming to the subject of solid-state drives, what are the chances of SSDs in helping with a turnaround in the NAND market? Or, are they (SSDs) hyped?

“I should not say SSDs (solid-state drives) are overhyped,” adds Kim. “There are lots of issues that the industry must overcome when bringing SSD technology to the real world. Hard disk drives (HDDs) have been used in PCs for more than 30 years, so the movement to SSD technology won’t be very rapid.”

iSuppli had predicted that SSDs would not impact the market this year or next year. The real prime time for SSD adoption will be in 2010. There are many optimization problems associated with SSDs, which is typical at an early stage in the technology industry. By 2011, iSuppli believes SSDs will be the number one NAND flash market driver in terms of dollar value.

iSuppli also believes that the global NAND flash per-megabit average selling price (ASP) will decline by about 60 percent in 2008, compared to its previous forecast of a 56 percent decline. On quizzing, he says, “As mentioned, the NAND flash market, even in third-quarter, holiday season, won’t have a turn around, which brings the ASP down to the 60 percent level.”

When NAND is taken out of the equation, how does the semiconductor industry look like? iSuppli believes that the 2009 global semiconductor market growth will be higher than that of this year. The semiconductor market is also cyclical, so it will be impacted by global GDP growth this year.

Finally, how does the research firm forsee Nymonyx (there was an article saying it will conquer NAND Flash)?

According to Kim, Numonyx is still a major NOR flash supplier with limited NAND flash market share. Unlike Intel, Numonyx’s focus is on mobile applications. Its joint-venture partner, Hynix, is scaling down its NAND flash production at this time and is focusing on DRAM production.

iSuppli doesn’t expect Numonyx to be a formidable competitor in the NAND flash memory market during the near term.

Indian semiconductor market growing thrice as fast as global market

September 3, 2007 Comments off

As per the India Semiconductor Association (ISA) and Frost & Sullivan (ISA-F&S), India’s 2007 annual growth in the semiconductor market is nearly triple the rate at which the global semiconductor market is currently expanding.

The actual total market (TM) was $2.69bn and total available market (TAM) was $1.26bn. By 2009, the TM will likely grow at a CAGR of 26.7 percent to $5.49bn and the TAM will grow at a CAGR of 36 percent to $3.18bn.

Anand Rangachary, managing director, South Asia & Middle East, Frost & Sullivan, said: “The global semiconductor total market is growing at a rate of 8-9 percent CAGR, whereas the India total market is growing at 26.7 percent CAGR till 2009. India, which represented 1.09 percent of the global semiconductor market in 2006 will be 1.62 percent by 2009. As domestic demand for all electronics products is growing India is emerging as one of the fastest growing region in the world.”

India is one of the fastest growing regions in the world. TAM growth rate at CAGR 36 percent, compared to 26.7 percent of TM CAGR signifies higher growth in local manufacturing of electronics products. In the industry, the technology change is so dynamic that every year, a new application/product gets launched, which changes the demand forecast by many ways (eg. launch of iPOD or iPhone/ WiMAX/GPON/LCD TV) as well as ASP changes.

The government rules change demand, and therefore ISA captures these changes on a real-time basis. Hence, ISA decided to have an annual update of the India market report. All of these changes are well captured in the current report and India’s growth looks almost three times compared to the global growth rate.

According to the report, the top five end-user products that are likely to drive growth are mobile handsets, desktops and notebooks, GSM base stations, set-top boxes and energy meters. Microprocessors, analog, memory and discretes are said to be the top four semiconductor products likely to drive revenues.

While these stats read great, I am wondering exactly how much of these handsets will be made in India. Rather, what percent of silicon going into these handsets will be made in India! Memory is said to be a driver of the revenue. Well, the DRAM market has been acting up.

Now, iSuppli reported in a recent report:

“Following a brief respite, market conditions for DRAM suppliers are set to take a turn for the worse in September, iSuppli Corp. predicts.

iSuppli previously forecasted that DRAM prices would undergo a downward correction in October, following the current period of relative strength that brought an end to a phase of severe erosion in the second quarter. However, iSuppli now believes the DRAM prices will begin to decline one month earlier, in September.

Near-term market conditions remain in a state of flux with a great deal of uncertainty in the supply chain as suppliers and distributors continue to work off a glut of DRAM inventory. Furthermore, sales momentum is waning in the DRAM spot market, as rising prices and falling supply of LCD panels cut into the available budget for memory in some PCs.

This is bad news for memory suppliers, which had been basking in the present period of relative pricing strength. Weak pricing in September will set the stage for further erosion in the fourth quarter. iSuppli now foresees the possibility of double-digit sequential price declines in the fourth quarter, erasing any increases that aided suppliers in the third quarter. Because of this, DRAM suppliers’ profitability will dwindle in the fourth quarter compared to the third, iSuppli predicts.”

I’d be very interested to see how much of these memory predictions turn out to be correct! If they aren’t, I wonder how memory is going to figure among the top four revenue drivers in the Indian semicon market, at least in the near and immediate future. Unless, I somehow missed a point somewhere!!

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