Global demand for tablet DRAM will continue to rise at a modest rate between now and 2018 with revenues up 10.64% CAGR according to recently released research from TechNavio, but vendors still face some challenges.

Market size for tablet mobile DRAM by revenue was US$1.51 billion in 2014, and the research firm predicts it will hit US$2.5 billion by 2018 – a growth rate of 9.3%. By volume, TechNavio said 2.24 billion gigabits were shipped in 2013 and a 35.3% growth rate will translate into 13.15 billion gigabits by 2018.

Navin Rajendra, industry manager for TechNavio, said the global tablet DRAM market is also experiencing increased consolidation, a trend that will continue throughout the forecast period. He said existing vendors and new players are anticipating mergers and acquisitions when entering the market or broadening their product offerings. For example, Micron Technology acquired Elpida in July 2013. Micron was ranked fourth in the global mobile DRAM market, according to TechNavio, and its acquisition of third-place Elpida has allowed the company to solidify market share.

Including Micron, TechNavio sees four key vendors in the market; Sansung, SK Hynix and Winbond Electronics comprise the other three.

Increased use of mobile DRAMs in tablets, fast product replacement cycles, and miniaturization of electronic devices are all driving the market, said Rajendra, and advances in technology have led to an increase in the application of mobile DRAMs, from traditional uses to various new product segments. These advances help vendors implement cutting-edge technology in the production process that could lead to the development of compact-sized DRAM with higher efficiency.

There will be challenges, however, including increased competition among vendors, an increase in demand-supply gap and less time to market. In addition, the tablet market has become somewhat saturated in the consumer segment, but TechNavio is still bullish on other segments, however, such as growing use for tablets in other areas such as healthcare and manufacturing. “There’s great potential for growth in these sectors despite sluggish growth in the consumer market,” Rajendra said. In addition to tablets, he said gaming devices will also contribute to the healthy demand for mobile DRAM, while smartwatches will also start making a dent.

Meanwhile, prices for mobile DRAM are likely to drop, Rajendra said, but that will be offset by higher volumes in shipments.

TechNavio expects LPDDR3 to continue to be in use through 2018, with LPDDR4 ramping up and gaining market share beyond the forecast period through 2019. Research firm IHS is predicting that LPDDR3 will still dominate the market in 2015, with LPDDR4 overtaking it in 2016, a transition that will be relatively quick transition, with price premiums on LPDDR4 not lasting very long.

Long-term, emerging memories such as NVM Express might negate the need for DRAM in tablets, but Rajendra said with commercialization of NVMe products is still in the early stages, “it's too early for us to gauge right now.” Small form factors are one of the benefits of NVMe, he said, but the cost of development in early stages with NVMe will be extremely high compared to DRAM, as well as the cost of integration. In November 2014, NVM Express announced version 1.2 of the NVMe specification with a feature for client systems that supports designing high-performance SSDs without local DRAM.

Aside from increased mergers and acquisitions, the two other key trends TechNavio highlights in its forecast for 2014-2018 are rapid advances in technology and increased research and development spending by vendors, with innovation opportunities around creating denser memory, said Rajendra.

Beyond the global market for mobile DRAM in tablets, TechNavio expects the overall global DRAM market will grow at a CAGR of 4% over the period 2013-2018, based on revenue generated from the sales of DRAMs for devices such as PCs, smartphones, tablets, laptops, ultrabooks, portable gaming devices, MP3 players and PDAs, with one of the key market drivers being the adoption of DRAM in smartphones.

By: DocMemory
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