Chicago (IL) – With catastrophic messages hitting the financial world each day now, the battered DRAM industry has become a negligible topic even in IT lately. And while DRAM manufacturers are dealing with one of most severe market environments in their history, there is always something positive for someone else – in this case the consumer: Nam Kim from iSuppli told TG Daily that DRAM prices may be about as low as they can get and if you are in need of some extra memory for your PC it may be a good time to shop.
Market research firm iSuppli today downgraded its DRAM outlook for the year by 5.4 points, indicating additional difficulties for the segment to turn the tide.
“New signs of weakness have mounted in the DRAM market in recent times,” the company said. “iSuppli in September cut its rating of near-term conditions for DRAM suppliers to ‘Negative, down from ‘Neutral’ before. Long suffering from a glut of parts, the DRAM market began to note a weakening in demand from the key PC market in September.”
Growth for the global PC market was also lowered to 12.5%, which iSuppli described as cautiously optimistic.
However, oversupply and declining demand in the DRAM industry are translating into rock bottom prices. If we forget a moment the wisdom that there is never and always a right to buy technology, since prices are typically decreasing over time, iSuppli chief analyst Nam Hyung Kim told TG Daily that DRAM module prices are “near bottom since prices stay below suppliers’ variable costs.” The crunch in the DRAM industry is serious enough that even upticks are squashed almost immediately and prices remain low and may trend a bit lower over the next six months, he said.
As a general rule, suppliers’ DRAM manufacturing costs decline 7-9% every quarter, Kim said. As a result, DRAM makers may actually make some money if DRAM prices remain flat, but that scenario is rather unlikely in the near term.
But Kim said that he “won’t recommend that consumers wait for further price drop.” In fact, comparing DRAM prices on various websites still reveals substantial price differences and consumers may be able to pick up DRAM for about the same money what OEMs currently pay their suppliers: 2 GB PC DRAM modules are around $28 in the OEM market, according to Kim. If you look closely, you can find this capacity for prices between $30 and $100 in online stores.
“Prices always drop and [consumers] can find better deals by browsing websites. It is very subjective matter how cheap prices are now. To me, prices are extremely cheap at this moment,” Kim said. He noted that cannot recommend buying DRAM memory since it is a market that is as risky as the stock market. However, he also said that “DRAM prices will further decline by the end of the year.”
Market research firm iSuppli today downgraded its DRAM outlook for the year by 5.4 points, indicating additional difficulties for the segment to turn the tide.
“New signs of weakness have mounted in the DRAM market in recent times,” the company said. “iSuppli in September cut its rating of near-term conditions for DRAM suppliers to ‘Negative, down from ‘Neutral’ before. Long suffering from a glut of parts, the DRAM market began to note a weakening in demand from the key PC market in September.”
Growth for the global PC market was also lowered to 12.5%, which iSuppli described as cautiously optimistic.
However, oversupply and declining demand in the DRAM industry are translating into rock bottom prices. If we forget a moment the wisdom that there is never and always a right to buy technology, since prices are typically decreasing over time, iSuppli chief analyst Nam Hyung Kim told TG Daily that DRAM module prices are “near bottom since prices stay below suppliers’ variable costs.” The crunch in the DRAM industry is serious enough that even upticks are squashed almost immediately and prices remain low and may trend a bit lower over the next six months, he said.
As a general rule, suppliers’ DRAM manufacturing costs decline 7-9% every quarter, Kim said. As a result, DRAM makers may actually make some money if DRAM prices remain flat, but that scenario is rather unlikely in the near term.
But Kim said that he “won’t recommend that consumers wait for further price drop.” In fact, comparing DRAM prices on various websites still reveals substantial price differences and consumers may be able to pick up DRAM for about the same money what OEMs currently pay their suppliers: 2 GB PC DRAM modules are around $28 in the OEM market, according to Kim. If you look closely, you can find this capacity for prices between $30 and $100 in online stores.
“Prices always drop and [consumers] can find better deals by browsing websites. It is very subjective matter how cheap prices are now. To me, prices are extremely cheap at this moment,” Kim said. He noted that cannot recommend buying DRAM memory since it is a market that is as risky as the stock market. However, he also said that “DRAM prices will further decline by the end of the year.”