The general expectation among memory market watchers is that pricing of DRAM and NAND chips will continue to rise. Component pricing has already increased significantly over the past year, resulting in higher prices for DDR4, solid state disks, video cards, etc.
In a new article, EE Times explores the reasons why memory pricing is heating up and points out that it's more complicated than many people think. It is not simply about an imbalance between supply and demand, but also about technological issues that impact scaling.
DRAM scaling for example is hitting new lows. DRAM bit growth is expected to be just 15 to 20 percent this year, the lowest level in over 20 years. As the chart below shows, the average bit growth rate between 2004 and 2013 was 47 percent. The combination of the limited number of players in the market, slow bit growth, and sluggish capacity expansion all result in tight supply and thus higher prices.
Similarly, the NAND market is seeing higher prices as 3D NAND is more difficult to manufacture than previously thought. This resulted in a lot of delays and the problem is compounded because planar NAND (which faces its own scaling issues) offered lateral scaling whereas 3D NAND scales linearly. NAND makers now need to satisfy growing demand with linear bit growth, while in previous years the bit growth rate was exponential.
The analyst points out that 64-layer 3D NAND finally hit price parity with planar NAND and that you need to double the numbers of layers with 3D NAND to double the storage capacity. Scaling beyond 64-layers is very challenging and puts a brake on memory size expansion.