A new report from Taiwan says that wholesale contract prices for DDR4 memory have fallen sharply over the past few months. The fall is mainly attributed to Samsung reducing its prices to gain market share. Samsung Semiconductor happens to be a subsidiary of Samsung Electronics, and is the world’s single largest manufacturer of semiconductor memory chips. With rapidly diminishing margins, some DRAM manufacturers are also reportedly considering postponing their proposed shift to the 20nm process till the end of the year or even later, to reduce their capital expenditure, according to industry sources. Meanwhile, with prices at an all-time low, OEMs are reportedly stocking up on DDR4 memory sourced directly from the semiconductor manufacturers, rather than from the DRAM vendors.
For the uninitiated, DDR4 memory is the new standard in memory chips that go into personal computers and smartphones (LPDDR4). The main advantages of DDR4 lies in its higher clock speeds and lower power consumption. While for consumers, the increase in speed sounds like a tempting option, server farms and datacenters are set to benefit massively from DDR4’s increased efficiency. DDR4 memory has a starting speed of 2133 MHz while DDR3 specifications start at 800 MT/s (Millions of Transfers per second) although some does go as high up as 2133 MHz (PC3 17000). The increased frequency results in an overall increase in bandwidth, yielding lower read and write times. As for power consumption, DDR4 operates at a slightly lower voltage of 1.2v compared to DDR3, which runs at 1.5v. While that might not make a lot of difference for a desktop user, mobile devices like smartphones and tablets will definitely benefit from the new technology, as will large-scale computer architectures, where you could have hundreds of systems running thousands of memory modules.
While DDR4 prices have climbed down significantly since its commercial introduction last year, it’s still more expensive than DDR3. There are speculations however, that by this time next year, DDR4 prices will fall further and DDR3 prices will climb up from its current depths, resulting in somewhat of a parity between the two. However, demand for PC DRAM hasn’t picked up since last year, mostly on account of Intel delaying the commercial launch of its next generation desktop processors codenamed “Skylake”. Meanwhile, demand for server DRAMs, which typically yield higher margins than desktop DRAMs, is also slowing on account of a stagnant server market.