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DRAM prices: will we survive the $15 DRAM?
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Written by Gizmo   
Saturday, 05 May 2007 00:03

EDN:

In a free-ranging discussion between industry analysts and Qimonda executives recently, the subject of DRAM pricing inevitably came up. The Qimonda people had observed that the downward trend in pricing had developed much more rapidly than they had anticipated in the first quarter of this year. Analyst Nam Kim of iSuppli asked how low Qimonda expected the benchmark DRAM price to go.

Read the full story at EDN:

Asked to answer his own question, Kim said that he believed the price would hit the $15 level. “Historically, the pattern has been for the price to drop until everybody is losing money for about one quarter, then it starts to turn around again,” Kim said. And then he pressed his question again.

Jan Dierens, Qimonda vice president of sales and marketing, relented a bit. “I’d never say it couldn’t get there,” he offered.

This got the attention of another analyst, Victor de Dios. “There are serious insolvency issues at the $15 level,” he warned, “especially if demand doesn’t pick up.”

Conversation continued, with one analyst warning that Hynix, newly reborn into the DRAM first tier, would defend its new-found market share at just about any price. That could be a serious problem, de Dios countered, because in the present environment there is no floor under DRAM pricing until some big player has the courage to walk away from an offer.

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