5 Top Storylines For NAND Biz

2019 is expected to be a busy, if not difficult, year in the NAND flash memory market.

Vendors will continue to ramp up 3D NAND, the successor to traditional 2D or planar NAND. Then, over the last year, prices for NAND have dropped with oversupply in the market.

What’s in store in 2019? Vendors are expected to rush out their next-generation products. Then, there is a debate whether the oversupply situation will last. Anyway, here are my five storylines for the NAND business in 2019:

Scaling race
Despite the slowdown in NAND flash memory, the competition is heating up again. Suppliers are racing each other to bring out their next-generation 3D NAND technology.

At the 2019 International Solid-State Circuits Conference (ISSCC), Samsung and the Toshiba/Western Digital duo are presenting papers on 3D NAND devices with 128 layers or thereabouts. Intel, Micron and SK Hynix are working on the technology as well as China’s Yangtze Memory Technologies Co. (YMTC).

At present, 3D NAND vendors are migrating from 64- to 96-layer devices. The next version is 128 layers or a product with a similar layer count. 3D NAND is the successor to today’s planar NAND flash memory, and is used for storage applications such as smartphones and solid-state storage drives (SSDs). Unlike planar NAND, which is a 2D structure, 3D NAND resembles a vertical skyscraper in which horizontal layers of memory cells are stacked and then connected using tiny vertical channels.

In 3D NAND, some suppliers are looking to stay ahead of the competition. At ISSCC, Samsung will present a paper about its sixth-generation 3D NAND technology, which features a 512Gb 3-bit/cell scheme with an 82MB/s write throughput and a 1.2Gb/s Interface.

The device is more than 100 layers. “We’ve never announced when we’ll ship the 1xx device,” according to a spokeswoman from Samsung. “However, we’re expecting to start production of 6th-gen V-NAND by later this year.”

At Toshiba/WD, the companies presented a paper about a 128-layer device with a 512Gb 3-bit/cell density and a 132MB/s write performance. The companies didn’t say when it would ship the technology.

What does this all mean? In 2019, 96-layer 3D NAND will remain the mainstream technology. Vendors will scramble to get their 128-layer products ready. “It seems like everyone’s marching to a cadence of a new layer count every year: 24, 32, 48, 64, 96, 128, etc. I suspect that 128 layer will sample by year-end,” said Jim Handy, an analyst at Objective Analysis. “Everyone’s already openly talking about a 500+ layer part. Who knows when it will end?”

Shortages or not?
Right now, there is too much supply of 3D NAND in general. But for how long?

“I don’t expect to see another shortage until 2022. There was a huge capital spending surge in 2017 that guarantees a very solid oversupply for quite some time. Once that dries up, then China will enter the market and extend the oversupply,” Handy said.

Others see it differently. “We expect NAND shortages by year-end. There has been very little new NAND fab capacity added over the past couple of quarters, restricting the NAND pipeline for 2H19,” said Weston Twigg, an analyst at KeyBanc. “Based on our fab-by-fab analysis, we project y/y bit supply to fall to 18% in 3Q19, far below the peak of 58% in 3Q18. We also anticipate pricing to stabilize in 2H19 on tighter supply, which will likely spark more demand for NAND as buyers rush to refill drained inventories before price hikes. While the NAND market could heat up in 2H, profit margins will likely remain low as the six major producers vie for share.”

Stay tuned.

What about China?
All eyes are on China’s YMTC. It plans to ship its first device this year–a 64-layer product. It’s due out by mid-2019, but will it meet spec? That’s a big unknown.

YMTC will skip the 96-layer generation and move directly to 128 layers. But it has to make a 64-layer product first to gain credibility. Otherwise, the party is over.

Intel-Micron saga
For some time, Intel has been developing two types of memory technologies—3D NAND and 3D XPoint. 3D XPoint is a next-generation memory based on phase-change technology.

For both, Intel’s memory partner is Micron, that is, until recently. Intel and Micron recently announced plans that they would go their separate ways for both 3D NAND and 3D XPoint. Intel and Micron will finish the next designs for both technologies and will develop products separately.

Going forward, Intel and Micron will compete. Let the party begin.

Buyer’s market
It’s a buyer’s market for NAND. Check out PCPartPicker, a DYI site. In some cases, SSDs are bargains.