Wednesday, August 14, 2019
Despite lackluster memory demand likely to persist till the end of 2019, the memory industry is expected to see a brighter prospect starting 2020 when 5G services kick off commercial runs driving the popularity of 5G terminal devices that will in turn generate strong growth for memory products, according to industry sources.
The sources said that the 5G commercialization will stimulate upgrades of datacenter servers, and the resultant strong demand for high-capacity server memory will come first to bail the memory industry out when operators move to accelerate establishment and expansion of datacenters.
The sources said the Tokyo Olympics 2020 and the commercialization of 5G services will trigger a positive cycle of investment expansion, stimulating buying sentiment at the consumer end and prompting telecom operators and web service firms to increase their investments in datacenters by 3-4 folds to support the use of 5G mobile devices.
Sumit Sadana, executive vice president and chief business officer at US-based Micron Technology, said that his company will zero in on business opportunities from the ever-growing 5G, AI, IoT and autonomous driving applications, which will create new business models and spur upgrades in memory and storage solutions.
For mobile devices to fast transmit data on 5G bandwidths, high-performance DRAM and NAND flash products will be badly needed along with a new wave of replacement demand for 5G smartphones. In this regard, Micron estimates smartphone storage capacity will sharply expand from 512GB in 2019 to 1TB by 2021 when data transmission speed hits 20Gbps.
Taiwan memory firms revving up deployments
To cash in on immense 5G-driven business opportunities, Taiwan's memory supply chain is also aggressively proceeding with relevant deployments.
Nanya Technology president Pei-Ing Lee said that 5G commercialization will bring two major impacts on the memory market. First is that mobile devices will require bigger memory capacity support. Some flagship smartphones launched so far in 2019 come with 12GB memory, and some midrange models with 6-8GB. Second is that demand for network devices including routers, servers and cloud computing solutions will grow sharply. Accordingly, Nanya started small-volume server memory shipments in the first half of 2019 and will ramp up shipments in the fourth quarter, expecting the shipment ratio for such memory to reach 10% in 2020.
Macronix is eyeing the first wave of 5G opportunities from femtocells, which will grow exponentially in number, and it is cooperating with vendors of network equipment, APs, routers, and Internet of Vehicles (IoV) equipment to jointly tap the opportunities. Macronix is optimistic about strong demand for high-capacity NOR memory products, bolstered by a spate of new applications created by V2X (vehicles to everything).
Meanwhile, Winbond has recently released its 2Gb NAND+2Gb LPDDR4x MCP (multi-chips package) modules to support the operation of high-speed 5G terminal devices,
Innodisk chairman Randy Chien said his company expects to have as many as 300 AIoT clients by the end of 2019, up from less than 100 in 2018, ready to embrace drastic business expansion after 5G commercialization kicks off in 2020.
Adata Technology chairman Simon Chen noted 5G, AIoT and telematics will be the three major growth drivers for the global memory market starting 2020, with demand to explode in 2021-2022 in the largest-ever bull market for memory.
Copyright © 2019 CST, Inc. All Rights Reserved