Zhaoyi innovation kills low price nor flash factory under pressure

Release date：2014-06-25   Views：2036

In the past two years, China's NOR flash factories have caught up with each other in terms of technology. The most famous one is gigadevice, which has swept through China's medium and low-level market with low-cost competition, resulting in a serious price decline. The Taiwan factory points out that although the customer's orders are kept, the price is indeed stirred up by Chinese manufacturers, and almost all the profits of large factories are eaten.

Coded flash memory (nor Flash has always been a fierce competition and began to merge many years ago. After the bankruptcy protection of Spansion, it focused on niche market, micron's acquisition of numonyx and microchip's acquisition of SST. At present, the market share of the top five manufacturers has reached 88%. The industry expected that the market situation would be stable after consolidation, but only two or three years.

There is a shadow of the government behind the land factory

In the past two years, Chinese manufacturers have cut into the low and medium capacity market and swept through the consumer electronics market with low prices. Even large manufacturers have been hard to resist. In the past two years, the annual price drop has even reached more than 30% or 40%, and the profit rate has declined sharply.

According to the senior management of the memory factory, Chinese manufacturers have the shadow of the government behind them. In addition, they don't care about intellectual property rights and compete in the market with low prices. At present, although the quality of Chinese products still can't catch up with that of large factories, the orders of international customers are not affected. However, the bloody competition of Chinese manufacturers will inevitably affect the market prices, and the large factories will not make profits.

NOR flash industry declines

At present, the most famous manufacturer in China is gigadevice. Within 10 years of its establishment, the process has been upgraded to 65nm, the maximum capacity of products has reached 512MB (one million bits), and the technology has been comparable to wanghong (2337) and Huabang (2344). These two Taiwan manufacturers are facing the greatest competition pressure.

Manufacturers complain that the real culprit for the rapid improvement of Chinese manufacturers' strength is a certain Taiwan factory. In order to covet the cheap OEM price, the whole process technology was transferred to SMIC, which greatly improved the manufacturing process and mass production capacity of SMIC, and in turn trained Chinese manufacturers to compete with Taiwan manufacturers.

According to Wang zhehong, an analyst at Gartner, a market research organization, China's NOR flash factory has grown quite fast in the past two years. The main reason is that the overall nor flash industry is not growing or even in recession. Due to the high unit cost of nor, many applications have been replaced by NAND flash or MCP (multi chip package).

NOR flash global market share ranking

Wide application provides basic needs

Secondly, products are widely used. Even low capacity 1MB still has a market, and China has a large production of low-cost consumer electronics, which provides basic demand.

Moreover, the manufacturing process of NOR flash is slightly slow. NAND has reached below 20 nanometers with a capacity of 64GB (1 billion bits). Nor is still at 45-65 nanometers, and the mainstream capacity is only 1GB, so new entrants can quickly close the gap.

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