Apple flash memory greed sparks industry shortages

Jonny Evans
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October 09, 2009
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You have to spare a thought for the plight of those poor flash memory vendors, not only are they in a market where the spot price goes up and down, but Apple’s greedy shoppers just can’t get enough of Cupertino’s shiny new flash-based toys...iPhone, iPods nano and touch, SSD drives for Macs, future tablets, yadda-yadda-ya...

News today claims there’s a shortage of flash memory components caused by (you guessed it) Apple gobbling up huge quantities of production from the top tier makers.

This is causing Taiwan’s memory module makers to diversify their NAND flash supplies to minimise procurement risk, tells Digitimes. That’s because the major makers - Samsung Electronics, Toshiba, Micron and Hynix Semiconductor “favour demand for Apple devices,” the report explains.

Demand is expected to climb 81 per cent this year, though manufacturers are conservative about investing in further production facilities just yet. Oh, and as Apple’s impact is felt across the market, prices are climbing up up up (well, by up to 14 percent on some modules).

Wonder what Apple’s beginning to stockpile all that memory for, eh, eh?

Comments (4)

Louis Wheeler (not verified) | October 09, 2009 - 12:22pm

Back not long ago, when the market was in free fall, and it looked as though the NAND flash market would go through the floor and companies would be forced out of business, Apple stepped in to buy up massive quantities on a deferred basis. That is, these companies got much money up front for future sales. This shored up the price and allowed these companies to survive, although this also locked in the price when good times returned.

Apple made out like a bandit on this deal, but so could have anyone else who wished to take the chance.

Now that better times are on the horizon, those companies who failed to strike a deal during the bad times are complaining about Apple's "Good Fortune."

It was not "Good Fortune' It was guts which they lacked. Now, as loser's, they must whine. All this does is to make them look pathetic.

刑事おど (not verified) | October 09, 2009 - 1:46pm

I'm not sure it could be called greed. I believe greed is taking more than you need. Apple really does have a NEED for flash memory since its devices come with more memory than most and the demand for Apple iPhone/Touch devices is going higher and higher. Apple knows for certain that they can barely keep ahead of iPhone demand. Apple is going to need even more memory for their tablet tablet device.

How is this a bad thing? Is there something wrong with this? The flash companies are not being stuck with memory that isn't selling. It's making them money, keeping their equipment running full time and keeping employees in jobs. Apple is one of the few companies that can put up a half-billion sure dollars in advance to be allotted large amounts of memory.

Neutrino (not verified) | October 09, 2009 - 3:57pm

This is also a consequence of Apple's huge cashboerd.

Louis Wheeler (not verified) | October 10, 2009 - 10:06am

Greed means "Excessive desire." What kind of excessive desire is this, since the word implies that a standard is at work here? It is the excessive desire which cause you to be mean, manipulative or hateful to other people. It is to scheme and plot to take what belongs to others.

When did Apple act mean, manipulative or hateful? No where I can see. Who's property was stolen from them? No body's.

The NAND flash manufacturers would not class Apple as greedy, because Apple came to their need in a time when business conditions were very bad. Would the consumers of electronic equipment think so? Not likely. Then who is claiming that Apple is greedy?

It is manufacturers of electronic equipment competing with Apple who could have bought like Apple did on a deferred basis, but did not. They are now bemoaning their misfortune in being forced to pay more in a restricted market. This places them at a disadvantageous position with Apple.

What if Apple did not exist and had not purchased these chips? What if three of those chip manufacturers had gone out of business, because Apple was not there with a big up-front fee? If there was a restricted supply in the chip market because most of the makers had gone out of business, these competitors of Apple would be accusing the surviving NAND flash makers of greed.

That would make as little sense as their current claims.