Rumor mill: The DRAM industry could be in for a major shake-up this year. Sources claim production of mature DRAM solutions may be winding down as the largest memory manufacturers shift their focus almost entirely to high-performance chips. If true, the move could have significant consequences for the market and end customers alike.
The "big three" in the DRAM industry are preparing to end production of DDR3 and DDR4 memory solutions this year. Samsung Electronics, SK Hynix, and Micron are reportedly aligning their business strategies, shifting focus toward DDR5 and high-bandwidth memory (HBM) products for the foreseeable future.
Halting production of older memory technologies could significantly impact the market, as end customers and device manufacturers still rely on them. Industry sources anticipate supply shortages beginning in late 2025, with Taiwanese manufacturers expected to step in and fill the gap left by their South Korean and American competitors.
According to Nanya Technology, a key Taiwanese component supplier, pricing strategies will need to adapt to these evolving market conditions. The DRAM market is projected to contract in the first half of 2025 but is expected to recover soon after, driven by rising demand, smart inventory management, and economic stimulus initiatives in various regions.
Companies are still trying to extract tangible value from the much-hyped AI revolution, while the chip industry continues to reap the financial rewards. Demand for memory products is primarily driven by cloud computing infrastructure for AI workloads, with consumer demand providing only a modest push.
Prices are expected to shift in response to these market trends. DDR3 and DDR4 memory prices are currently in decline, while manufacturers are strategically shifting focus to DDR5 and HBM. Meanwhile, analysts at inSpectrum report that DDR5 prices continue to rise despite weak demand.
The growing emphasis on high-performance memory products is prompting component providers to upgrade their manufacturing capabilities. Taiwanese IC manufacturer Winbond Electronics plans to transition to a new 16nm process in the second half of 2025 to produce 8Gb DDR chips. Currently, the company's 20nm process is primarily used for 4Gb chips in DDR3 and DDR4 memory solutions.
