This photo provided by Samsung Electronics Co. on Thursday, shows the company's semiconductor manufacturing plant in Pyeongtaek, 70 kilometers south of Seoul. (Samsung Electronics Co.)
Prices of enterprise solid state drives (SSDs) are likely to increase sharply in the third quarter of the year due to robust demand from server companies, a report showed Friday, boding well for top memory chip producer Samsung Electronics Co.
Contract prices of enterprise SSDs for the July-September period are expected to go up 10-15 percent from the previous quarter, according to the latest report from market researcher TrendForce, which revised its previous forecast of a 5-10 percent increase.
It said the price hike will be driven by North American cloud service providers' efforts to expand their storage capacities following inventory adjustments, while government agencies and other businesses are beefing up their IT infrastructure.
A ramp-up in production from computer processor developers like Intel Corp. and Advanced Micro Devices (AMD) Inc. for server CPUs are also projected to increase demand for enterprise SSDs, TrendForce said.
Such a trend will likely lead to supply leader Samsung further expanding its presence in the market, the market researcher added.
SSD is a storage device that contains multiple NAND flash chips. Samsung is the world's largest maker of NAND flash, a type of non-volatile memory.
"Samsung has a higher flexibility in supplying SSDs compared to the other suppliers because it has a higher share of in-house components for its storage products," it said.
"Samsung's products are expected to account for more than 50 percent of enterprise SSDs (in terms of bits) shipped to data centers in North America in 3Q21. This dominance will likely further Samsung's ability to dictate market prices going forward," TrendForce said.
It said Intel's market share may decrease in the enterprise SSD sector since the US has been dealing with a shortage of power management integrated circuits.
"Regarding other suppliers, including Kioxia and SK hynix, although they have been able to raise their market shares due to the gradual adoption of their products by clients, they are unlikely to catch up to Samsung for the time being," the market researcher said.
Meanwhile, for client SSD contract prices, it predicted a 3-8 percent quarter-on-quarter increase in the third quarter, citing strong demand for notebook computers. (Yonhap)