Samsung Increasing Purchases of Memory Products from Outside

Published on April 11, 2013, in FAB, NAND Prices.

Samsung Electronics reportedly has expanded the purchase of memory products from outside, including the purchase of mobile DRAM chips from Elpida Memory as well as NAND Flash and eMMC devices from Toshiba/SanDisk.

Samsung’s own supply of memory products is already falling short of internal demand, including that for its Galaxy-series smartphones and tablets, industry sources have claimed.

Any shortage of DRAM and NAND Flash chips at Samsung will affect the global memory supply/demand balance, given that the vendor’s in-house production capacity accounts for the biggest portion of the world total, the sources said. Nonetheless, Samsung has switched to a more flexible approach to its component procurement – an effort to manage risk, the sources observed.

Some industry observers, however, have questioned the motive of Samsung’s reported move to buy more memory products from outside suppliers. They noted that Samsung reportedly is buying more chips from Japanese firms while continuing to use its in-house produced chips for its Galaxy-series mobile devices. This is reportedly happening when Samsung has actually implemented a strategy to tightly control its chip output, the observers pointed out.

Taking eMMC devices as an example, the market has been in a tight situation since 2013 due to brisk demand coming from the smartphone and tablet sectors. Samsung has a significant portion of the available production capacity worldwide.

Samsung has long been the world’s largest producer of DRAM and NAND Flash memory, and in recent years expanded at a fast pace its presence in the mobile device field. In the smartphone market, Samsung pulled ahead of Apple in 2012.

Source” DigiTimes

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