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MacRumors
Jul 19, 2007, 10:29 AM
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A report (http://seattlepi.nwsource.com/business/324217_applechip19.html?source=rss) by the DramExchange.com indicates that Apple's iPod and iPhone could use up to 25% of the world's production of NAND Flash chips this quarter.

This, along with production delays amongst NAND Flash manufacturers could contribute to shortages and rising prices.

NAND Flash supplies and pricing could also affect rumored plans (http://www.macrumors.com/2007/04/27/apples-subnotebook-delayed-until-late-2007-early-2008/) for a NAND-flash based subnotebook from Apple - which was last pinpointed for release in late 2007/early 2008.


Article Link (http://www.macrumors.com/2007/07/19/flash-shortage-due-to-ipod-and-iphone/)



Grimace
Jul 19, 2007, 10:34 AM
It's hard to imagine that other companies still want to compete with Apple! :D

macpeter
Jul 19, 2007, 10:34 AM
That would be amazing :eek:

Eraserhead
Jul 19, 2007, 10:39 AM
wow that's pretty impressive for one company, I suppose it's because they use such high capacities compared to cameras...

Clive At Five
Jul 19, 2007, 10:39 AM
A report (http://seattlepi.nwsource.com/business/324217_applechip19.html?source=rss) by the DramExchange.com indicates that Apple's iPod and iPhone could use up to 25% of the world's production of NAND Flash chips this quarter.

I find this hard to believe...

What about allllllllll the other PMPs and PSPs and Wiis and whatever else?!

25% globally?

Wow...

-Clive

Gymnut
Jul 19, 2007, 10:40 AM
That would be amazing :eek:

What would be amazing? That the shortages and high demand will cause prices to rise?

Cinch
Jul 19, 2007, 10:43 AM
What would be amazing? That the shortages and high demand will cause prices to rise?

I smell a good opportunity for price fixing. Be aware of trade publication

Yankees 4 Life
Jul 19, 2007, 10:53 AM
I smell a good opportunity for price fixing. Be aware of trade publication

agreed, i'd be very wary of sandisk and other flash makers, i wonder how they are going to spin their new price floors....

ajhill
Jul 19, 2007, 11:08 AM
25% of all flash memory in the world? Come on! Yes, iPods and iPhones are selling out the door, but 25% of world demand? Did Apple sell 5 million iPhones so far, 10 million. Not likely.

This sounds like a BS press release from an industry that is seeing intense pricing pressure. They are looking to increase those prices and one way to do it is to try to create the impression of constrained supply.

If Apple is currently using 1/4 of all the worlds supply, then it's REALLY going to be an interesting earnings report next week.

Smells like the flash memory boys are looking to drive up prices to me.

Doctor Q
Jul 19, 2007, 11:10 AM
If this is correct, the shortage was caused by sales of these successful products, and the result may be rising prices of flash chips, which would produce higher costs to produce iPods and iPhones. Therefore, if we favor lower prices, we should tell our friends not to buy iPods or iPhones!

I doubt I'll be able to do that!

aardwolf
Jul 19, 2007, 11:20 AM
You know what makes prices go down? One of the many things is mass production. I'm relatively certain that all of the factories making flash chips in the world are not producing at capacity, so any price increase will be minimal and temporary.

lookmark
Jul 19, 2007, 11:20 AM
I think that all-flash full-size iPod (32/64/128GB) is looking increasingly likely.

CrackedButter
Jul 19, 2007, 11:29 AM
I think that all-flash full-size iPod (32/64/128GB) is looking increasingly likely.

It was always likely.

reallynotnick
Jul 19, 2007, 11:32 AM
I think that all-flash full-size iPod (32/64/128GB) is looking increasingly likely.

At the current price of ~$6 a GB, I see that highly doubtful. 32GB = $192 128GB = $768

This would be a nice time to open up some new NAND factory I would assume.

EagerDragon
Jul 19, 2007, 11:35 AM
Excelent for Apple in multiple ways:
Their agreements with Flsh man is working
Their price for memory is not affected
They are selling a lot
Their competitor prices are going up and their ability to deliver is being affected.

LoganT
Jul 19, 2007, 11:43 AM
I think that all-flash full-size iPod (32/64/128GB) is looking increasingly likely.

128 GB flash?

Prepare to pay more than an iPhone for that.

Sun Baked
Jul 19, 2007, 11:46 AM
Remember Apple got in line early and plopped down some megabucks for a Flash supply awhile ago, so them eating a significant portion of their supplier volume isn't too odd.

But the future Flash products sure will be constrained.

davidmyers
Jul 19, 2007, 11:56 AM
It would be hard to believe if apple could pull off a sufficiently sized
flash drive laptop in the next 6 months, given this.

(Plus, I imagine apple will also want to go firewire with the shuffle soon too.
And the aTV can't be too far behind, etc etc)

Altogether, their demand for flash memory must be astronomical right now,
and can only figure to get worse for the next year or so.

If yer buyin a digital camera chip or a cell phone flash chip this fall/xmas,
the price might be way up depending on which type of chip it takes!

bigandy
Jul 19, 2007, 12:12 PM
bet all the other manufacturers are going to be cursing the iPhone/iPod success for a while :rolleyes:

Rocketman
Jul 19, 2007, 12:43 PM
It might be helpful to view this article in terms of "timing". Apple has just ramped the largest new gadget release in a long time which is flash based. It just dropped a couple of weeks ago. Of course flash inventories are constrained. The ramp is still occuring and Apple has stated they intend to sell 10 million of these things in about a years time. They have already sold between a million and 1.3 million of them by some estimates. Flash production is constrained, so it can withstand steady state sales, but not sudden large sales as occured with the release of YA iPod Nano and the iPhone in short order. Apple is hoarding flash with the strategic move of prepaid purchase contracts which floats the price down as sales prices drop. This may simply defer the timing of that drop.

Rocketman

SiliconAddict
Jul 19, 2007, 12:47 PM
Good. Maybe this will make Apple think twice about going all flash. Granted up til now that concept has been purely rumor but anything that keeps such an idea in the realm of rumors I'm all for.:)

Stampyhead
Jul 19, 2007, 12:53 PM
If Apple is using this much Flash memory maybe they should think about opening their own factory and start making the chips themselves. Then they have better control of pricing and availability.

jacobj
Jul 19, 2007, 01:01 PM
This is not the first time that this excuse has been used: I seem to remember that a similar claim was made regarding Apple's consumption of Flash memory about 18 months ago.

I must admit that the stat is a little too extreme to believe, but I'll ask the question that occurred to me back then; does the ipod Nano, Shuffle and iPhone use single flash cards, or do they consists of several smaller ones? If it's the latter, then it makes some sense to me; but still!

Archmagination
Jul 19, 2007, 01:25 PM
This is not the first time that this excuse has been used: I seem to remember that a similar claim was made regarding Apple's consumption of Flash memory about 18 months ago.

I must admit that the stat is a little too extreme to believe, but I'll ask the question that occurred to me back then; does the ipod Nano, Shuffle and iPhone use single flash cards, or do they consists of several smaller ones? If it's the latter, then it makes some sense to me; but still!

The Shuffle uses single flash cards, while the Nano uses 2 flash cards. I don't know about the iPhone, but I think someone commented on it using 1 flash card.. I am not sure though.

corywoolf
Jul 19, 2007, 01:39 PM
It would be hard to believe if apple could pull off a sufficiently sized
flash drive laptop in the next 6 months, given this.

(Plus, I imagine apple will also want to go firewire with the shuffle soon too.
And the aTV can't be too far behind, etc etc)

Altogether, their demand for flash memory must be astronomical right now,
and can only figure to get worse for the next year or so.

If yer buyin a digital camera chip or a cell phone flash chip this fall/xmas,
the price might be way up depending on which type of chip it takes!

Firewire Shuffle... yeah.... ok.... I take it your drunk or really tired or don't know much about Apple. Either way, welcome to MacRumors, try not to take anything personally. :) You may want to read up on Apple in the Guides here.

Edit: I am starting to think you were trying to be sarcastic?

Yankees 4 Life
Jul 19, 2007, 01:55 PM
128 GB flash?

Prepare to pay more than an iPhone for that.

haha look at 64GB flash.... that thing goes for 255 on ebay... and thats without shipping.... from THAILAND!!

What does that mean? That means this isnt going to be happening for a while.... No flash based iPods until 2009

twoodcc
Jul 19, 2007, 02:41 PM
this is bittersweet. it's good that apple is selling so many ipods and iphones, but i don't want the price of Flash to go up, and i want to see that subnotebook released

offwidafairies
Jul 19, 2007, 03:08 PM
i dont understand :confused:
with increased sales shouldnt prices drop??

JGowan
Jul 19, 2007, 03:17 PM
At the current price of ~$6 a GB, I see that highly doubtful. 32GB = $192 128GB = $768

This would be a nice time to open up some new NAND factory I would assume.I think it's high time Apple build its own Flash memory factories and control their own destiny. While everyone else fights for the 8GB and 16GB flash drives, we could be sporting some serious mojo.

Doctor Q
Jul 19, 2007, 03:22 PM
i dont understand :confused:
with increased sales shouldnt prices drop??In theory, quantity sales can produce economies of scale, lowering prices, but there are forces that pull in the opposite direction. Shortages of parts that raise component costs can increase the total price, until suppliers adjust to meet demand. And as long as sales stay high, Apple may have little incentive to lower prices even if manufacturing costs go down, until/unless competition forces them to do so.

shawnce
Jul 19, 2007, 03:23 PM
i dont understand :confused:
with increased sales shouldnt prices drop?? No... not if they cannot manufacture enough to match demand or the fact that it is selling so well is a good indicator that you are pricing it about right, if not to low.

synth3tik
Jul 19, 2007, 04:35 PM
Haha, Apples bogarting all the flash

SiliconAddict
Jul 19, 2007, 04:51 PM
I think it's high time Apple build its own Flash memory factories and control their own destiny. While everyone else fights for the 8GB and 16GB flash drives, we could be sporting some serious mojo.


This is in the same realm as people who said Apple should start developing their own CPU to control their own destiny. Some people don't have a frame of reference to base such insane comments on. Do you know how much it costs to build such a plant? R&D smaller fab processes? Etc? Etc? Etc?

Belly-laughs
Jul 19, 2007, 05:24 PM
this is bittersweet. it's good that apple is selling so many ipods and iphones, but i don't want the price of Flash to go up, and i want to see that subnotebook released

Donīt worry. As others have correctly stated Apple has already made deals on current and close future purchases with manufacturers, at set price. Good for Apple, bad for competitors.

DeanCorp
Jul 19, 2007, 06:51 PM
Very clever on Apples behalf, because they are almost monopolising(correct spelling, I live in Australia) the market by creating artificial barriers to entry :)

I hope we still get to see the solid state macbooks soon though :P

DeanCorp

JGowan
Jul 19, 2007, 06:52 PM
This is in the same realm as people who said Apple should start developing their own CPU to control their own destiny. Some people don't have a frame of reference to base such insane comments on. Do you know how much it costs to build such a plant? R&D smaller fab processes? Etc? Etc? Etc?I suppose I thought it might be possible due to the fact that very recently (maybe WWDC, I forget), Steve Jobs specifically spoke of of the factories that Apple built to produce the iPhone. Seemed possible that if they could build a factory for iPhones then they could build their own flash. I don't think it sounds so "insane".

Genghis Khan
Jul 19, 2007, 10:44 PM
this is the first step of getting flash memory into computers...with iPhone, and predictably iPod soon, the market for flash memory will be larger...meaning it will get cheaper

just wait for someone to open another factory to accommodate for this shortage;)

JimDisty
Jul 23, 2007, 06:11 PM
The average cell phone has 60mb of memory in it all called NAND Flash - the IPHONE has either 4GB or 8GB of NAND Flash - so take it as a average of 6GB in a IPHONE just to be on the low end - as we all know most people are buying the 8GB - well at 6GB that is 1000 times the memory in a normal cell phone - in fact the amount of memory that will go into just the 5 million IPHONES that Apple will build between now and the end of the year is the same amount of NAND memory that would be used to build 500 MILLION - yes 500 Million normal cell phones - then you add the IPOD - NANO - all the other MP3 players digital cameras - the new Samsung laptop that has no hard disk only NAND memory as a replacement - now think a minute - LG, Motorola, Samsung, Erickson - all the other Cell phone companies are going to have to come up with something to stay in the game against the IPHONE - It takes 2 - 4 years to build a factory to product these parts at a cost of about 3 BILLION dollars to do it - Shortage, oh you can count on it - its alreadu here - I have been in this market 33 years- brace yourself for a major storm

JimDisty
Jul 24, 2007, 12:20 PM
this is the first step of getting flash memory into computers...with iPhone, and predictably iPod soon, the market for flash memory will be larger...meaning it will get cheaper

just wait for someone to open another factory to accommodate for this shortage;)

Sorry to add my 2 cents it is not going to take 1 factory it is going to take atleast 5 - 10 new clean room factorys - at a total cost of about 30 Billion dollars and a min of 6 - 8 years to complete them and be able to get the proper equipment installed