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Server DRAM to be biggest part of memory market for years

Analyst haus Trendforce sees DC gain where there's consumer pain

Server memory products are likely to overtake mobile memory in share of the overall DRAM bit output this year, as the datacenter market sees continued demand while consumer devices are hit by the economic downturn.

The memory market has been in freefall over the past months, with average DRAM prices shrinking by 34 percent in Q4 of 2022, on top of a 31 percent fall during the quarter before that, according to market researchers Trendforce.

Now, the analyst is projecting that growth in smartphone shipments and any increase in the average DRAM content of the devices themselves will remain “conservative” during 2023.

As a consequence, it expects DRAM suppliers will instead keep growing the share of server memory in their portfolio, to the point where it will make up about 37.6 percent of the bit output this year, compared with about 36.8 percent for mobile DRAM.

According to Trendforce, smartphone vendors showed a tendency to stick with hardware specifications that could be met by components within their existing inventories when developing devices for release during 2022, and this constrained DRAM content growth.

Now, it estimates the growth rate in the average DRAM content of smartphones will be about 6.7 percent for 2023. This is a marked improvement over the growth rate of 3.9 percent for 2022, but TrendForce predicts the year-on-year growth rate will remain under 10 percent for the next several years.

Meanwhile, servers are seeing newer applications related to artificial intelligence and high-performance computing (HPC) that have driven demand for more memory. For this reason, TrendForce believes server memory will represent the largest part of the overall bit output production from the DRAM industry over the next several years, and it expects the average DRAM content of servers to increase by 12 percent this year alone.

Turning to NAND flash memory, TrendForce said bit growth related to client SSDs has also slowed due to a marked contraction in laptop computer shipments in what it terms “the post-pandemic period.”

At the same time, enterprise SSDs now make up a growing portion of the entire NAND flash demand, due to cloud services expanding during the pandemic and leading to an increase in both server shipments and the average memory content of servers, TrendForce claimed.

But a fall-off in NAND flash prices has stimulated demand from both the smartphone and server industries, the company claimed. The effect of this price elasticity on demand means the growth in NAND flash content per unit is set to pass 20 percent for both smartphones and enterprise SSDs.

However, because of a rising demand for high-speed data storage, enterprise SSDs are forecast to overtake other categories of NAND flash products in terms of order volume. TrendForce said that enterprise SSDs will represent the largest segment of the NAND flash market in terms of bit demand by 2025. ®

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