Memory price rises to continue

The memory market looks set to be more stable and profitable in 2002, and this could mean higher prices.

Industry consolidation, product diversity and changes in the customer base should result in fairly stable prices for the memory that goes into PCs and servers, according to analysts.

Prices have been rising since November 2001 and could boost industry revenue from approximately $22 billion in 2001 to between $32 billion and $42 billion this year. "There is a lot of comfort for the year being healthy, partly because of the supply situation," said Tom Quinn, vice president of marketing at Samsung Electronics.

In March 2002, a 128 Mb chip of SDRAM, the most common form of memory on the market, is $8 in the spot market and rising, according to figures from Thomas Weisel Partners. In August 2001, the same chip sold for $3.