The strength of the current upturn resembles the sharp turnaround seen in 2010, but could have longer sustainability based on (1) fewer producers; (2) the divergence of DRAM demand drivers with mobile devices overtaking PC DRAMs; and (3) the uncertainty in DRAM equipment technology keeping new fab builds at bay.
Mobile DRAMs are facing upward price pressure, despite the best efforts to allocate the limited availability of DRAM wafers to the area of the highest demand. The DRAM industry no longer depends on PCs for growth—specialty DRAMs have together taken over as the new DRAM industry growth driver, representing 60% of industry demand.
Globally, eight DRAM producers entered the previous DRAM downturn. Only three producers remain, in addition to the relatively weak Nanya-Inotera combination, to benefit from the current upturn. Elpida continues to undergo the process of being acquired by Micron. With the eventual Elpida-Micron merger, the top three DRAM producers should control 90% of the global market share as shown below.