Last Updated Feb 22, 2009 2:01 PM EST
I emailed memory market expert Jim Handy of Objective Analysis and asked him what he knew about the story and, if it were true, what conclusions could be reasonably drawn. Here's his response:
The article has a lot of holes, and I think that ThinkEquity was trying to explain the short-lived uptick in NAND spot market prices that ended this week. The spot market is replete with bumps and troughs caused by errant rumors. This appears to be yet one more...So far we have different takes on what could be a short-term spike in prices. And there could be other explanations, like the market having worked through at least some of what has been an over-supply. According to EETimes, a recent Gartner report doesn't see the price increase as proof of surging demand. Quite the opposite:
Should demand continue at historical growth rates, rather than falling off due to general economic woes, NAND prices should firm up in the second half of this year. If demand slackens, then it won't happen till later. How much later depends on the depths to which the world economy shrinks.
''The NAND industry appears to be poised for a price recovery, but it will be tenuous for three reasons: (1) a barren demand environment; (2) quick capacity additions by raising depressed utilization rates, and (3) price increases temper end demand,'' [according to Gartner analyst Joseph Unsworth].Now, let's look at the claim the report makes that Apple has buying all of Samsung's capacity through April. Given that the report pegs Samsung's market share at 40 percent, that would be a whole lot of memory. Maybe a new iPhone model is coming out, but remember that sales would largely replace what would have been purchases of other iPhone versions. I know the iPhone is popular, but, really, snapping up on the order of at least 7 percent (40 percent times one-sixth of a year) of the entire global supply? And how likely is it that Samsung would devote itself to only one of its customers for two months? Sure, the memory market and been slow, and maybe Apple made an offer that Samsung couldn't refuse. But many of its other customers compete with Apple. Would it be smart for Samsung to snub them for a two month lift?
Maybe Samsung told ThinkEquity that it was in thrall, at least for a time, to Apple. But the more I think about this scenario, the less likely it seems.
[UPDATE: Last year there was another rumor about Samsung freezing out others in favor of Apple. But at least to Thomas Ricker at Engadget, it didn't make sense then, either.]
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