Personal computers during the second quarter accounted for less than half of the market for DRAM, the first time in a generation that they didn’t consume the majority of the leading type of semiconductor memory. PCs in the second quarter accounted for 49.0 of DRAM bit shipments, down from 50.2% in the first quarter, according IHS iSuppli.
The fall is notable, given that the share of PCs hasn’t dipped below 50% since the 1980s, when personal computers were a new product whose sales were rising at rapid clip. After accounting for the overwhelming share of DRAM buying for decades, average PC share from the first quarter of 2008 until the fourth quarter of 2011 hovered at approximately 55%, with share fluctuating periodically but generally trending down. During the period from the second quarter of this year to the fourth quarter of 2013, the portion of DRAM shipments accounted for by PCs will contract another 6%, sliding to 42.8%.
In comparison, the share held by media tablets will continue to rise. Tablet share of the DRAM space in terms of bit shipments grew to 2.7% in the second quarter, up from 1.6% in the first quarter, and will gradually expand by 4%age points until it hits 6.9% by the fourth quarter next year.
Meanwhile, cellphones will experience even faster growth, with their share of DRAM bits rising to 19.8% in the fourth quarter of 2013, up nearly 7 points from 13.2% in the second quarter of 2012.
The combined share in the fourth quarter of 2013 by handsets and tablets of the DRAM market will reach 26.7% - almost double from 14.1% in the first quarter this year.
The decline of PCs in DRAM share appears irreversible. However, it’s important to note that PCs will remain the largest single market for DRAM at least through the end of 2013, and overall DRAM bit shipments for personal computers will continue to grow.
“The arrival of the post-PC era doesn’t mean that people will stop using personal computers, or even necessarily that the PC market will stop expanding. What the post-PC era does mean is that personal computers are not at the center of the technology universe anymore - and are seeing their hegemony over the electronics supply chain erode. PCs are no longer generating the kind of growth and overwhelming market size that can single-handedly drive demand, pricing and technology trends in some of the major technology businesses,” said Clifford Leimbach, memory analyst at IHS.
This event symbolizes the decline of the PC market because of smartphone and media tablets. However, beyond symbolism, the development also illustrates the diminishing dominion of PCs in the electronics supply chain. The fact that PCs have lost their majority share of the DRAM market - an area completely defined and dominated by personal computers for about 30 years -represents a major milestone and the arrival of a new era in technology.
“For DRAM suppliers, the focus in the future increasingly will be on serving the needs of fast-expanding new markets for smartphones and tablets, at the expense of catering to the PC business. This follows other indications of the waning influence of the PC business in the electronics business. Such factors include the declining power of the Wintel alliance, as well as Apple Inc.’s smartphone- and tablet-driven ascendency to chip purchasing leadership above traditional PC-oriented frontrunners like Hewlett-Packard,” said Mr. Leimbach.