X-bit labs

February 2004 Hardware News Overview (page 7)

Category: Editorial

by Andy Yaschenko

[ 02/23/2004 | 06:37 PM ]

Feeling the difference is also the problem with DDR2 that’s getting closer to us. In January Elpida started mass production of 2GB registered PC2-4300 DDR SDRAM modules based on 533MHz 512Mb chips. This is running ahead of the earlier announced schedule, so Intel’s money hasn’t been wasted. Samsung also announced a 2GB registered module in January along with unbuffered 1GB module. Samsung has versions for all speeds: PC2-3200, PC2-4300 and even PC2-5300 (this is only for the ordinary 1GB module), but they only talk about sampling their chips.

Well, it’s better getting along cautiously, especially as the perspectives of DDR2 are rather vague in this year. Manufacturers of memory chips, mainboard makers and analysts are getting more skeptical about DDR2 being able to become the leading memory type in the market in 2004. It’s more probable that the difference in price of DDR and DDR2 won’t be at first proportional to their performance ratio. Although there are numerous module samples, many manufacturers agree that they will start mass production in Q3-Q4 of this year, or in early 2005.

So far the manufacturers have been busy trying to reduce the production cost of a DDR2 chip – by increasing their capital investments. Korean DRAM manufacturers alone are going to invest about $6 billion into modernization of their facilities, expanding them and transferring them to 300mm and tech processes 110nm or 90nm. Nanya is going to have 40-50% of its facilities using the 110nm tech process by the third quarter of this year. To produce mainly DDR2, of course. Micron also increases its capital spending to $1.3-1.6 billion. Overall, they are all investing money with rather hazy perspectives of ever returning them.

It will be really interesting to know the changes in the companies’ ratings by the end of this year. I guess some changes are sure to occur (one thing is only certain – Samsung’s first place). At least, the beginning of the new year has brought a small sensation as Infineon lost its third place to the invincible Hynix by the Q4 results. Hynix has now 15.8% of the world DRAM market against Infineon’s 14.6.

It was largely due to the strong positions of Hynix in Asia, China and Japan, but can it keep them in the future? For example, the Japanese government under the pressure from Elpida is going to discuss introduction of protective duties against the Hynix produce. The rate of duties is as high as 40%. In other words, such duties close this market for Hynix completely.

The only country where this trick cannot pass is China. Hynix actually has its own production there: chips are produced by the company’s partners. However, Micron is going to enter this market, being enticed by the rapid growth of the Asian market, so Hynix should be on guard.