Why DRAMs are Like Steel

The McKinsey Consulting Steel ModelOver lunch today I had a conversation with an alum of McKinsey Consulting who remarked that the DRAM business behaved in a way that was similar to the McKinsey Steel Model.  For those unfamiliar with this model I found a slideshow HERE that refers to it a good deal.  (So far I have not found a tutorial on the model itself, but if anyone knows were to find it The Memory Guy would highly appreciate hearing about it.)

One interesting thing is that this particular McKinsey alum was not the first to point this out to me.  About 15 years ago a family friend/McKinsey alum told me exactly the same thing.  It seems that the economics of the DRAM business have changed little over the past 15 years, and the McKinsey steel model applies to DRAMs just as well now as it did then.

In a nutshell, the model posits that the market price for Continue reading “Why DRAMs are Like Steel”

Elpida Finally Makes Statement

Difficult Times for ElpidaFor months rumors have abounded regarding Elpida’s viability and plans the company has to overcome its current financial woes.  Although the company has been questioned about advanced payments and loans from its customers, takeover and merger possibilities, and even government intervention, Elpida has remained silent, refusing to comment.

Today the company finally made a statement that it will be adding a note to its Q3 results and earnings report: “on Matters concerning the Assumed Going Concern.”

This statement, which looks like it was written very carefully by either Continue reading “Elpida Finally Makes Statement”

DRAM Consolidation in 2012?

History of DRAM Market Share by Company2012 is likely to be a year in which the DRAM market consolidates a little bit more.

Consider this:

  • At its peak in the late 1980s the DRAM market sported 23 suppliers.
  • Today there are 6 suppliers of any note: Samsung, Hynix, Micron, Elpida, Nanya, and Powerchip
  • The already-depressed market is only going to worsen in 2012.  Capital spending in 2010 is seeing to that.  Although many believe that prices cannot get any lower, that is exactly what they will do in 2012. Continue reading “DRAM Consolidation in 2012?”

Top Ten Trends for NAND Flash

Flash Memory SummitDuring the Flash Memory Summit in August three panelists were asked to tell what they thought would be the top ten trends for NAND flash in 2012.

The panelists were:

  • Troy Winslow, director of product and channel marketing for the Intel NAND group
  • Radoslav Danilak, SandForce founder and now CEO of StorCloud
  • Me

Here are mine:

  1. Enterprise SSDs will be used in all data centers
  2. There is still a lot of growth in NAND
  3. Controllers will get more sophisticated
  4. System software will be designed for NAND first
  5. Tablet PCs will morph into newer devices
  6. Not everyone can be a successful SSD supplier
  7. NOR has a long future in code storage
  8. NAND in PCs is a threat to DRAM, not HDDs
  9. The death of flash is not imminent
  10. SSDs in PCs will lose out to NAND + HDD

Over ten future posts I will elaborate on these.  As I do I will add hot links to the list above to guide readers to these predictions.  If any of the hot links are inactive, come back later and check again.

Many are detailed in reports on the Objective Analysis Reports page.