Articles:
1. Long Term Trend in the NOR and NAND Markets
2. What's next for Spansion? /EETimes
3. Spansion's Chapter 11 signals the erosion of the flash memory market / betanews
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1. Long Term Trends in the NOR and NAND Markets
I believe the article about Spansion's Chapter 11 ... is missing the point of the real reason for the failure of Spansion. The key reason is that in the non volatitle market the NOR is on a shrinking growth rate pace compared to NAND's accelerating growth rate. As a result, the semiconductor companies that focused on NAND have been growing faster and have been more profitable than the ones that focused on NOR. The current global economic upheavl is just accelerating this trend.
This phenomena is mainly due to NOR’s higher cost and smaller memory size relative to NAND at every semiconductor technology node. A similar development took place in the SRAM and DRAM memory market in the past. SRAM and DRAM unit volume used to be equal in size, but as a result of DRAM being cheaper with a larger memory size, its current market size is about 10X the size of SRAM memory (even though SRAM is faster).
This growth trend in the volume of products and applications that use NAND and not NOR has been accelerating for several years. See the article below about the trouble that Intel had in selling NOR memories from May 2007
Barron's Eric Savitz column / May 2007
"Report Plan to Spin of NOR Business IN JV STMicro "Done Deal" Hynix Also Involved"
http://blogs.barrons.com/techtraderdaily/2007/05/09/intel-report-plan-to-spin-off-nor-business-in-jv-with-stmicro-done-deal-hynix-also-involved/
My comment at the time as seen in the link above -
"It would make sense for Intel to pull out of the NOR business, over the next several years NOR volume will drop to 1/10 of NAND volume..."
Another example indicating this long term trend impact of NAND on NOR is in What's next for Spansion
While the complete article is below, the relevant points are:
''In the fourth quarter a decline in end-user demand caused NOR unit shipments to plunge,'' Handy said. ''In all prior years NOR unit shipments have followed a cycle, with quarterly increases from Q1-Q4 before a seasonal drop-off in the first quarter. Last year NOR unit shipments collapsed in the fourth quarter to a level not seen since early 2005...
Some designs are even converting to NAND alone. Unless the high-density NOR is sold at a very low price, today's cheap NAND is likely to capture the bulk of the design's flash revenues,'' he said. ''One gigabyte of NAND today sells for only about 10 percent of the price it commanded in the middle of 2007. NAND's price slide is dragging down high-density NOR prices, vacuuming all the profit out of the market for the two leaders.''
Ron Maltiel
Providing timely and accurate consulting and business news for the semiconductor industry.
