Solid-state Memory Growth for Packaging

The removable solid-state storage (RS3) market posted strong growth in 2005, as consumer demand for flash cards and universal serial bus (USB) flash drives continued. Revenue increased 44% over 2004 for RS3, reaching $9.87B, despite a significant shortage of flash memory components during the first half of 2005. Prices were firm after Apple announced its iPod shuffle and galvanized the flash-based music player market, even as the market was impeded by production issues. Pricing softened considerably by mid-2005, enabling consumers to obtain lower-cost 512MB and 1GB products in the aftermarket. The mobile phone proved a significant application for driving flash card unit growth through bundled cards with phones, and the USB flash drive category witnessed the emergence of the smart USB drive platform late in the year. As a result of these new demand drivers and lower costs in the retail market, solid-state RS3 megabyte consumption rose 171% over 2004.

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Competition continued to intensify in 2005. Table 1 ranks leading 10 RS3 vendors by revenue. SanDisk remained in the top position for flash card sales, while Toshiba and Samsung gained share. Other top players, like Sony, Panasonic, and Lexar, also lost share due to the strong performance of the other vendors, including Ritek, Infineon, Transcend, and Kingston. The USB flash drive market segment witnessed the top three vendors (SanDisk, msystems, and Lexar) lose share, although they retained their positions. The main reasons for their decline were Toshiba’s considerable market share gains and the emergence of several USB drive vendors that gained share by exploiting their dynamic random-access memory module expertise.

Continued demand for flash cards for digital still cameras (DSC) and MP3 players provided the main driving force for growth. Other applications, such as mobile phones and increased capture of digital video on flash cards, comprised an increasing share of card growth. Mobile form factors gained headway by being bundled with mobile phones, but higher-capacity aftermarket purchases remained sluggish in 2005. Smart USB drives represented only about 3% of the 85.2 million USB drives that shipped. USB flash drive market revenue went up to $2.42B, up from $1.47B in 2004.

The top three flash card formats in 2005 in terms of revenue were the SD card (46%), CompactFlash (20%), and memory stick formats (17%). 512MB and 1GB capacities captured about 48% of flash card revenue and 55% of USB flash drive revenue in 2005.

Many flash and USB cards use both system-in-package (SiP) and stacked 3-D packaging technologies. Stacked packages appear to be gaining ground as the preferred method of packaging due to ease of test, increased yields, and the ability to make packages in thinner formats.

There were 676 million TSOP and 2.1 billion CSP packages produced in 2005 for the flash memory market. 457 million bare die were additionally used in the various stacked die packaging formats. All of these were used in one form or another to produce the flash cards and USB flash drives.

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JIM WALKER, VP research, semiconductor packaging and assembly, may be contacted at Gartner-Dataquest, 251 River Oaks Parkway, San Jose, CA 95134; 408/468-8483; E-mail: [email protected].


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