Dominique Numakura's Newsletter from Japan

Hard Disc Drive vs. Flash Memory

As I have been reporting the news of micro disc drives in Japan and Korea the manufacturers have been shifting the main products to 1.8" or smaller. They have been targeting the growing market of small portable electronics such as cellular phone, digital camera and MP3. The customer want larger memory in a small body to hold many photos, music and movies. The drive manufacturers have been working continuously to bring new products to market. Toshiba will start volume supply of 0.85" drives with 4 GB products soon, while  Hitachi and Samsung are already supplying 1.0" drives.  More drive manufacturers have been entering the market.

On the other hand, flash memory has become a direct competitor to the disc drives. The capacities of flash memories are still smaller than the disc drives but they have several key advantages compared to the drive memories. Basically, flash memory is the solid-state device and it does not have any moving parts in the package.  The cost per MB became comparable recently.  The flash memory already had more than 70% market share in the MP3 applications. MP3 manufacturers choose micro drives for capacities greater than 2 MB and flash memories for capacities less than 1 MB. Currently, the area of 1 MB to 2MB is the battle zone for the devices but it will move to larger sizes as the capabilities of the flash memory increase. The disc drive manufacturers have to develop larger capacities with smaller sizes to keep the business. The drive manufacturers hope that a new technology of vertical recording system supports the battle against flash memory. 

By the way, the circuit board manufacturers and material suppliers should pay serious attention to the memory battle because the devices consume very different circuit materials. Micro drives use a couple of special flex circuits and multi-layer boards. Flash memory device consume only one high-density substrate. I do not think any one memory device will maintain a dominate market share more than 2 years because of the quick movement in the market.  This means the manufacturers have to develop new products in the next few quarters, certainly within a year. The market is huge and will maintain a high grow rate but it will be a tough battle for the circuit suppliers and material suppliers.

Dominique Numakura
 

Headlines of the week

JSR (Major electronics material supplier in Japan) 2
Started the manufacturing operation of LCD materials at the second line of the Korean plant. It is two month earlier than original schedule.

Fujitsu (Major electronics company in Japan)
Will roll out the new 2.5" disc drive "MHV2160BT" with 160 GB capacity in September as the memories of the TV and mobile computers.

Canon (Major electronics company in Japan)
Will invest 20 billion yens for the new R&D center for the new display device, SED in Kanagawa prefecture.

Star Seimitsu (Mechanical component supplier in Japan)
Has developed a new micro pump without motors. 

Novaled GmbH (Major component supplier in Germany) 
Has developed a top emission type red color organic EL with a high emission yield, 10 lm/W and long life.

Mitsui High Tech (Major packaging material supplier in Japan)
Will invest 400 million yens for the inspection process of IC reliabilities.
 
Matsushita Electric Works (Major laminate supplier in Japan)
Will increase the selling price of the copper laminates 10 to 15% again from September 16th because of the cost up of copper foils and epoxy resins.

Koa (Major component manufacturer in Japan)
Co-developed a new inkjet printing process with Epson to generate fine traces (60 micron pitch) for the multi-layer LTCC circuits.

IR Japan (Semiconductor device manufacturer in Japan)
Has introduced a metal can package for the new 20V rate MOSFET device.
 
Yokogawa Electric (Equipment manufacturer in Japan) 
Will increase the R&D engineers for semiconductor test machines 200 to 500 targeting 150 billion yen revenue in 2010.

JEITA (Japan)
The July domestic shipment of the Plasma TV declined 19.6% to 27 thousands units from the same month of 2004.

Canon (Major electronics company in Japan)
Has acquired Anelva Corp. from NEC for the in-house manufacturing of the key devices of SED (Surface-conduction Electron-emitter Display).
 
Tokyo Seimitsu (Equipment manufacturer in Japan)
Has developed a new equipment and manufacturing process to produce 5 micron thick silicon wafers.

Mitsui High Tech (Packaging material supplier in Japan)
Has developed a new small size package "HMT" for the semiconductor devices.