Apple Computer Inc.'s recent iPod introductions were a disappointment, which, in turn, will impact the overall demand for the NAND flash-memory market in the fourth quarter of 2006, according to a report from Gartner Inc.

Last week, Apple (Cupertino, Calif.) rolled out new versions of its iPod MP3 line, but Gartner believes that the products were "evolutionary" and "did not redefine the portable media player category."

"Instead, Apple focused on growing its margins for its shuffle and nano lineup and decided it is not necessary to have the most aggressive pricing at this time," according to Gartner (Stamford, Conn.). "Unfortunately for NAND flash vendors, Apple could have made a much greater impact with its long-awaited refresh of its flash-based music players, through more aggressive pricing and capabilities, but perhaps it chose not to."

Apple is still expected to ship about 13-to-15 million flash-based iPods in the fourth quarter. But due in part to the lackluster lineup, NAND demand — and product shortages — are going to be lower-than-expected.

"Gartner Dataquest forecasts a shortage in the fourth quarter, but more likely in the 3 percent range instead of the 4.6 percent [range] originally expected in the third quarter," according to the firm.

If NAND prices do not firm up, the overall market is expected to fall below the $14 billion range, it added.

By: DocMemory
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