Flash prices set to plunge?

The price of NAND memory is expected to almost halve to a dollar (0.65) a gigabyte in the new year, according to research firm iSuppli.

Flash memory currently costs around $1.80 (1.16) per gigabyte and, if the prediction holds out, it will

mean two-year low for NAND chips. About a year ago the price was over the $2 mark.

In 2008, the low price for memory gave rise to a rumour that solid-state drives (SSDs) would soon be competitive with hard disk drives (HDDs). Michael Yang, a senior analyst at iSuppli, said that he does not believe that the drop in price will rekindle this rumour.

"Traditional HDDs gained a lot of additional ground during the past few years in terms of rising capacity and falling prices," he said. "In fact, HDDs have gained so much ground that SSDs now are in danger of never regaining their competitive footing."

He thinks that triple level cell (TLC) flash chips would have to drop to 40 cents per gigabyte by 2012 to stand any chance of competing. At that price a packaged 100Gbyte SSD would cost around $50 (32).

Higher demand is usually followed by shortage of supply in the memory market. Yang is confident this will not be the case and he said that supply is sufficiently ahead of demand.

The recent announcement from Intel and Micron Technology of a higher density NAND chip could hold the key to a further drop in the price. The smaller form factor would also make it easier to increase the capacity of fixed-format SD memory cards.