Recent spikes in NAND flash pricing is not expected to put much of a dampener on solid-state drives (SSDs), according to market research group IDC.
The memory price increases were reported by market analyst iSuppli earlier this month. It said the average prices of 16GB-density Multi-Level Cell (MLC) NAND flash rose nearly 128 percent between the fourth quarter of 2008 and the second quarter of 2009. NAND flash, the company noted, accounts for around 90 percent of the value of a SDD.
Responding to follow-up queries from ZDNet Asia, Michael Yang, iSuppli's senior analyst for memory and storage, said PC manufacturers will not so much shun SSDs as a result of the substantial hike in NAND flash pricing, but SSD adoption rates will be impacted.
The extent of the impact, however, could be minimal over the entire 2009, said IDC. Jeff Janukowicz, IDC's research manager for SSDs and HDD components, confirmed that the decline in NAND production seen in the fourth quarter of 2008 and first quarter of 2009, had led prices to increase during the first half of this year.
"SSD pricing was impacted near-term," he said. "Yet, with the SSD market still in an early-phase for adoption, the impact on shipments was modest."
Janukowicz added: "We still expect SSD shipments to increase by over 100 percent in 2009."
The analyst added that from a longer-term perspective, the average selling price of NAND flash is expected to decline at a five-year compound annual growth rate (CAGR) of 46 percent through to 2013. During the same forecast period, IDC also expects SSD shipments to achieve a CAGR of 55 percent, and SSD revenues to register a CAGR of 49 percent.
Similarly, iSuppli's estimates show that prices of 16GB-density MLC NAND flash will drop steadily from Q2, 2009's US$4.10 to US$2.20, by the fourth quarter of 2010.
IDC's Janukowicz noted that the industry is also starting to iron out SSD pricing, which has been a "key metric for SSD adoption, especially in cost-sensitive segments and markets traditionally serviced by hard disk drives". One example, he explained, was Intel's announcement of its transition from 50-nanometer to 32-nanometer manufacturing process for SSDs, which the chip giant claims allows prices to be reduced by 60 percent.
When contacted by ZDNet Asia, several PC makers did not comment specifically on SSD prices over the last six months. A Singapore-based spokesperson for Asus, however, noted the company will keep its prices competitive despite higher component rates. "For a finished product within [the] IT industry, it will be very unlikely that price will go up despite [an] increase [in] price of its components," she said.
A spokesperson from Hewlett-Packard's personal systems group in Asia-Pacific and Japan, said: "HP continues to find new product paradigms that benefit from the attributes of SSDs to deliver greater value and performance to our customers."
"SSDs used to be a feature of high-end and corporate notebooks, but better industry volumes and improving prices have enabled us to offer such configurations in our SMB and HP Mini notebook ranges as well," the spokesperson added.
Separately, a report released Monday by Techaisle indicated that over 1.5 million small and midsize businesses in both mature and emerging markets are likely to purchase SSD-based notebooks over the next six months. According to the study, intent was highest in China, Italy and Russia.