Dropping DRAM prices to hammer small firms

Home > Business > Industry

print dictionary print

Dropping DRAM prices to hammer small firms

With prices of dynamic random access memory, or DRAM semiconductor chips, plunging to a record low yesterday, small Korean chipmakers are facing export woes. According to the online International DRAM Exchange, the spot price of a 256-megabyte DDR DRAM chip fell 6.1 percent yesterday from the previous day to an average of $2.92. Prices crashed below the $3 level after breaking through the $4 level about a month before. In April last year, they were as high as $6.50 per chip. DRAM chips are used as the main memory for personal computers and servers. Although excess supply has been pulling down chip prices for some time, new computer hardware developments have provoked a sudden change in market demand from DDR to DDR2. The need for DDR2 DRAM chips sprouted late last year, when Intel began releasing a series of next-generation platforms and server chipsets that use DDR2 DRAM chips, which process data four times faster than regular DDR DRAM chips. Computer makers such as Dell, HP, and IBM plan to convert to these platforms completely by the third quarter of this year. While falling prices of DDR DRAM chips are not good news for the chip-making industry here, larger companies such as Samsung Electronics and Hynix Semiconductor say they are unlikely to be affected. “The price may have gone down, but we sell them much cheaper in bulk,” said Kim Ah-young, a spokesperson for Hynix. “Small companies that sold chips above $3 will be affected though.” Also, bigger companies have already been converting their production line to make DDR2 DRAM chips; smaller firms have not. Samsung Electronics, the number one maker of DRAM chips, began the world’s first commercial production of DDR2 DRAM chips in October, 2003. As of July last year, cumulative production surpassed 10 million; the company now makes more than that on a monthly basis, having more than a 50-percent hold on the global market. by Wohn Dong-hee
Log in to Twitter or Facebook account to connect
with the Korea JoongAng Daily
help-image Social comment?
s
lock icon

To write comments, please log in to one of the accounts.

Standards Board Policy (0/250자)