During the networking sessions at the recent IIOM members meeting, Simms discussed with various people the supply shortage of NAND Flash. We have put together a short overview to give an understanding of what the issues are and what to do next to ensure supply is maintained.
The supply shortage of NAND flash in the third quarter of 2016 will exacerbate in the fourth quarter due to higher demand in the smartphone and solid-state drive (SSD) industries, according to the latest report from DRAMeXchange. The short supply, coupled with strong demand will contribute to rising prices of NAND Flash wafers and memory cards until the end of 2016. DRAMeXchange also expects prices to rise for eMMC, eMCP and SSD products.
In addition, demand from SSD manufacturers continues to increase as SSDs approach price parity with HDDs. DRAMeXchange expects the SSD adoption rate for notebook computers worldwide will exceed 30 percent for the first time, reaching nearly 33 percent, in 2016. Demand also is growing significantly for enterprise-grade SSDs in the second half of 2016. Demand has been mainly driven by server manufacturers and data centres in the U.S. and China. The NAND Flash shortage if predicated to last well into Q1 2017.
Production capabilities are limited for NAND Flash and as a result lead times are getting longer. With shortage of supply comes obsolescence issues. With limited production capabilities inevitably NAND manufacturers are forced to concentrate on supply for the most popular and profitable technologies. Over the longer term this can have such a devastating effect on critical applications as new replacements need to be sought when less popular technologies are no longer supported. Simms offer services such as; Just in Time delivery with call off facilities and full product migration to help steer our customers through these challenges.
The message from Simms to overcome potential obsolescence issues is;
- Investigate and understand your short and medium term demand for NAND based products (0-12 months)
- Highlight cost sensitive requirements and remove the volatility aspect by forward ordering.
- Take stock provisions or work with a supplier who can manage this on your behalf.