Samsung has cut the cost of the company’s DDR4 chips to usher in manufacturing DDR5 memory at a faster pace, DigiTimes reports.
Samsung lowers DDR4 memory price to speed up DDR5 production, phasing out DDR3
The company continues its trend of reducing chip production for DDR3 memory modules and focusing on selling budget DDR4 memory strategies. The company hopes to not only eliminate the overstock of old DDR3 memory from its factories, but also change the industry focus on new DDR5 memory to make it the standard for all systems and devices.
IT Home reports that DDR3 vendors are following the same trend “to maintain orders.” With the changes in the consumer DRAM price market, analysts expect prices to rise over the next few months.
Prices for 4GB DDR4 memory have fallen since last month by almost 8%, although the drop in costs has been called “unreasonable” in light of memory manufacturing costs. Analysts expect DRAM prices at the consumer level to fall 15% by the end of the current quarter.
It is also reported that Samsung and SK Hynix increased production of DDR5 memory during the two companies’ attempts to phase out their DDR3 stock. The concern at this point is that the growth of DRAM will become limited in the overall market with the current strategy.
This aggressive pricing strategy is also not the first time that Samsung has addressed this pricing structure in the industry. In June 2015, the company reportedly reduced DDR4 modules to increase its market share. The effect Samsung has had on the market has caused several module vendors to feel the negative impact of the company’s action. OEMs bought chips directly from Samsung, removing vendors from the equation. Meanwhile, each manufacturer was slowly switching to 20nm due to high capital expenditure.
Samsung’s price reduction on its memory modules, at the time DDR3, was found to lead to faster adoption of the new memory available and was seen as more profitable for the company.
Sources of information: DigiTimes, IT Home, , , , ,