Gartner Inc. lowered its 2008 global semiconductor forecast Monday, citing falling memory chip prices and a weakening global economy.
The market researcher now predicts 3.4 per cent chip revenue growth this year to US$278.4 billion, compared to a previous estimate of 6.2 per cent. Last year, chip revenue reached US$269.4 billion, up 2.5 per cent year-over-year.
Falling memory chip prices are to blame for most of the revision, but the market researcher also warned that global economic problems could cause further trouble for chip makers.
The DRAM (dynamic RAM) market has been in recession since the start of 2007, Gartner said, and may not pull out until the end of the third quarter of this year. DRAM revenue is expected to fall 15 per cent this year to around US$54.9 billion, from US$58.1 billion last year.
But the main cause of Gartner’s chip revenue revision is the main storage memory chips used in iPods, iPhones and digital cameras, NAND flash. A severe oversupply in the NAND market caused chip prices to fall at the end of last year, and Gartner “sees no respite in the short term.”
The company halved its NAND market forecast for this year to 15 per cent revenue growth.
Price declines in the NAND market may hurt the bottom line at chip makers such as Samsung Electronics and Toshiba, but it’s great for consumers. The lower pricing is already showing up in cheaper flash memory cards, and additional storage in devices, as well as price declines for some great products, such as Apple’s iPod Shuffle.