Electronics Production | August 06, 2009

Sales of NAND Flash Memory for smart cell phones to boom

Global sales of NAND-type flash memory for use in smart cell phones are expected to rise by nearly sixfold from 2008 to 2013, as shipments of the high-end cell phones boom in the coming years, according to iSuppli.
Global revenue from sales of NAND flash for mobile phones is set to rise to $932.5 million in 2013, up from $166.5 million in 2008. This will represent a Compound Annual Growth Rate (CAGR) of 41.1 percent, compared to the 12.2 percent increase during the same period for the overall NAND flash market.

The attached figure presents iSuppli’s forecast of NAND flash for use in smart phones.

“Soaring sales of smart phones, combined with the increasing density of NAND flash in each handset, is causing sales of the memory in this area to boom,” said Michael Yang, senior analyst for mobile and emerging memories at iSuppli. “NAND flash makers can thank Apple Inc. for starting this trend, with its iPhone models injecting new life into the memory market. However, with the introduction of the a new generation of ‘iPhone killers’, multiple smart-phone makers now are helping to drive NAND demand.”

The market for smart phones is expanding at a much faster rate than that of the overall wireless handset segment. Smart phones will account for 26.4 percent of total cell phone unit shipments in 2013, up from 13.1 percent in 2008, according to iSuppli.

The iPhone is a major factor driving the growth
“Apple announced it sold 5.2 million iPhone 3G and 3GS models during its fiscal third quarter, which ended in June,” Yang said. “Furthermore, Apple plans to introduce the iPhone in China, possibly early next year. This will open up the market for the iPhone to a new potential audience of 1.3 billion people.”

The arrival of competitive products like the Palm Pre, the BlackBerry Storm and the Google operating-system-equipped T-Mobile G1 will further drive the expansion of the smart-phone market.

NAND usage rises
Along with spurring the growth of the smart-phone market, Apple has taken a leadership position in enhancing the functionality of these products by adding additional NAND flash memory to its iPhone line. “The more NAND in a smart phone, the more useful it becomes, able to store more songs and video clips, to hold more map data and download more programs from an applications store,” Yang said.

The initial iPhone base model, introduced in January 2007, integrated 4Gbytes of NAND. The latest version of the iPhone, the 3GS unveiled in June, upped the low-end model’s NAND density to 16Gbytes. The high-end 3GS integrates 32Gbytes of NAND.

The new iPhone killers, including the Pre, the Storm and the G1, all include 8Gbytes of NAND. However, some models are increasing their NAND density to higher levels. For example Nokia’s N97 embeds 32Gbytes of NAND flash.

iSuppli predicts NAND densities in smart phones will continue to increase. Due to this and the rising sales of smart phones, the average NAND density in all mobile phones will expand in the coming years. The average amount of NAND flash in all mobile phones shipped worldwide will rise to 5.8Gbytes per handset in 2013, up from less than 1Gbyte in 2008.
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