Well, it appears that after the DRAM segment, the NAND industry has started to report unprecedented demand, as one of the leading suppliers, Phison, calls the situation a "shocking" one.
Consumer SSDs Could Get a Lot More Expensive, Since AI Has Arrived to 'Gobble Up' NAND Chips
The AI industry has managed to take every aspect of the supply chain by storm, and after disrupting the chip market, it is now targeting the DRAM and NAND supply chains. Based on Phison's Q3 earnings call, the firm's CEO Khein-Seng Pua revealed that the ongoing memory cycle is something that has never been seen before, and apart from just DRAM, the ASPs of NAND TLC memory are rising massively, growing by up to 50-75% in just a few months, which is an indicator that consumer SSDs and associated NAND products are expected to become a lot more costly.
One of the reasons the NAND industry is experiencing massive demand is that, in the age of inference, storage drives utilizing this technology are being adopted on a large scale. For instance, across data center environments, NAND-based drives are being used in model storage, pre-loading LLMs onto local SSDs for low-latency startup. In the event of an update to the model itself, these changes are reflected in storage devices, such as SSDs. Phison is reporting a 'tight market' supply, and the increase in NAND TLC pricing is expected to remain steady with time.
Players within the NAND industry have experienced a 'demand drought' for quite some time now, and with AI inference, it has brought in a gigantic spike in the need for storage devices across AI environments. Phison's CEO claims that NAND facilities have been underutilized for several months, which means suppliers have been cautious when it comes to expanding capacities. However, since the demand coming from AI is on an 'unprecedented' scale, it is expected that supply will see a rise over time as well.
We believe NAND company, they're not willing to expand the fab until now because in the last five years from COVID until now, the total profit in the NAND still even. They're not making any good profits, but from now on they start to get profit.
- Phison CEO
With the initial rise in DRAM demand, the average consumer was expecting a steady increase in RAM pricing, but what happened was that modules and their ASPs rose massively, doubling in many cases. Similarly, in the NAND industry, one can anticipate that prices for consumer storage devices, such as SSDs, will rise dramatically, especially for models with higher storage capacities. Hence, the upcoming 'deals season' might be one of the best times to upgrade your PC's storage capabilities.
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