What are Actual NAND Costs Today and in 2030?

 

In our FMS paper on NAND costs for all vendors and all technologies, we showed how NAND bit costs are being reduced as we go from 64L to 256L. We also showed that equipment companies and Fabs are improving efficiency much faster than we expected. We also showed that QLC will grow to over 50% of bits by 2025 and that this will lead to cost reduction.

As a result, ACTUAL NAND bit costs are on track to drop ~20% per year if we continue the increase in layers at this rate.

Details are at www.mkwventures.com with multiple reports

Some data:

 

+ Each layer increase brings significant cost reduction
+ Costs are significantly reduced each year for each existing technology (efficiency)
+ QLC is modeled at 22-23% cheaper than TLC

Overall, this leads to Gbyte cost reduction (these costs include package, assembly, test) over the next 10 years:

Another presentation at the same FMS session, re-published as well, also had costs for each company and technology. While the technical analysis of the processing and teardowns is excellent, their cost numbers are obviously incorrect. If those costs were the actual costs, every NAND company would be running negative 10% gross margin. Their margins are bad… but not that bad. Our costs line up with and are calibrated to what actual ASPs are and what actual margins are. All the gory details are available for discussion.

Mark Webb

www.mkwventures.com

 

Emerging Memory Revenue (MRAM, Optane, 3 XPoint, ReRAM, FE RAM)

A Picture is Worth a Thousand Words

Emerging Memory Revenue (MRAM, Optane, 3 XPoint, ReRAM, FE RAM)

www.mkwventures.com

What is the Market for Emerging Memories in 2030?

 

We have a lot of requests to predict the Emerging Memory Market in 2025 and 2030. We provide an estimate and the reason why most other forecasts are way off.

At Flash Memory Summit, we presented details on Bits and Revenue for Optane 3D Xpoint in 2025. This presentation is available at our website www.mkwventures.com  along with NAND Costs and other presentations.

But that wasnt good enough! People wanted a summary of ALL emerging technologies and data through 2030. When people make predictions, I like to say "did you predict this year? or last year?  or next year correctly? if you can't predict the past... give up on 2030. 

Emerging Memory as we define it is 3D Xpoint+ MRAM + ReRAM + Fe RAM + others. It is does not include NAND, DRAM, NOR, SRAM, EEPROM, etc. 

This is for stand alone memory only. Not embedded/SOC

Summary (Call us for more details and how you can monitor our progress)

Year        Optane/3D XPoint    MRAM         All New Memories (includes low density)

2020        1.1B                            80M                1.25B

2025        4.3B                            250M               4.75B

2030        9.7B                            610M                10.7B

The emerging Memory Market will grow to $10.7B in 2030. 90% of that is PCM/Optane

Why is MKW Ventures number different from other estimates???

1) Other estimates use CAGR. It turns out memory and storage revenue is not very "compound" ... it actually grows more linear than exponential after first couple years. This is why SSD and NAND sales are half of what people predicted back in 2013. BITS grow CAGR... Revenue does not due to cost and ASP reduction.... and the fact that customer can't print money.

2) Even for existing "new" technologies, they are not growing that fast. MRAM revenue is growing 10% per year right now... during a huge breakthrough period. We predict huge revenue increase for Optane simply because Intel is investing Billions in it and is driving new bus connections for it. Without Intel ... divide the numbers by 5-10 

3) New technologies are expected by others to take off quickly. If ReRAM or FeRAM take off. it will be in 4-5 years and it will not replace other markets. Optane is 5 years after production introduction and Micron sales are less than $10M per year other than Intel. It take a long time ... AFTER we agree the technology works

No technology or product has had 35% revenue CAGR for 10-15 years.... Obviously it won't happen with Emerging Memories either. 

I have details by technology and checkpoint to monitor... and details on why PCM/Optane will grow. Call for more info

Mark Webb

www.mkwventures.com

Mark Webb/MKW Ventures at Flash Memory Summit

We have multiple Virtual Presentations at FMS next week. Please check them out and schedule a meeting to discuss questions and answers. We have a zoom meeting Friday 11/13/20 at 11AM Pacific time where we will add commentary and additional numbers

Our Presentations:

Session A-3: Using 3D XPoint to Overcome Storage Roadblocks 2:35 Tuesday

Mark Webb: 3D Xpoint Market Bits and Revenue

We present Rev 1 and 2* Optane/3d Xpoint technology updates and we guesstimate what some future teardowns might show. We show revenue, cost over time and why we think there will be big improvements in both SSD and Persistent memory sales in 2 years. The Market is not going to $8B but it could surpass 3B  per year in the next few years. We can discuss the information used to make those predictions after the presentation. And what are the margins on Optane looking like these days??

Session C-3: How Data Centers Can Profit from New Memory Technologies 2:35 Tuesday

Mark Webb: Annual Emerging Memory Update

We give an update on memories for the datacenters. Our focus is not on every technology. We show that using the Memory Product Lifecycle, technologies are in VERY Different positions. The lifecycle allows you to judge each technology and where it is in terms of success probability. We also make the prediction and call to action "its time to focus and spend money on EMERGED technologies and we should spend less time on the EMERGING technologies which are 5+ years from products"

Session A-4: 3D XPoint in 2025, and How We Got There 4:45 Tuesday

Live Panel Session where we field questions on what the 3D Xpoint market will look like in 2025. We will give our opinions with bit shipments and revenue and what will cause the inflection point in 2023!

Bring questions! 

Session C-9: Flash Technology Advances Lead to New Storage Capabilities 8:35 Thursday

Mark Webb: FLASH Memory Technologies and Costs through 2025

We will show the status of NAND technologies, what each company is doing, and what the roadmap looks like to 256L and beyond. We will show relative costs for each technology over time from each company.  We also show why we are seeing costs drop FASTER than originally predicted. The cost leaders will soon change and this will impact the market. We show average price compared to HDD over time and when it will crossover.... for TLC, QLC and even PLC. Spoiler alert: Nearline HDD isn't going away as fast as some NAND companies predict

There is a ton of back up data, graphs and exact numbers for these presentations. We can set up private meetings after the presentations, just call or email

ZOOM MEETING

We will host a public ZOOM call on Friday Nov 13th at 11AM Pacific Time. Bring questions, comments, differing opinions and disagreements. We will provide some more quantitative data on 3D XPoint technology , NAND costs, MRAM technologies. And what about Hynix???

Meeting Name: Mark Webb MKW VENTURES Post FMS Conference

Time       11AM-NOON Pacific Time 11/13/20

Meeting ID

820 7491 8873

Mark Webb

www.mkwventures.com

Intel Sells NAND Biz to Hynix... sort of

 

Three Interesting items from Intel/Hynix Announcement so far that make us go "hmmmm?":

1) Intel not selling Optane and the Optane projects will be managed by the Datacenter group in the future. This is a relatively small business (I will update revenue and bits at Flash Memory Summit in 3 weeks) so it will be hidden in other revenue for DCG.

2) Intel will continue to manage and own employees at Fab and in R&D for another 4.5 years. That's 2 memory cycles and 2 presidential elections and most likely at least one change in Intel's CEO. Intel will keep manufacturing there. So what exactly did Hynix buy and who manages the Fab? This is very strange

3) Hynix is buying Intel's Datacenter SSD business. Intel is very strong here. It is not clear that if "Intel SSDs" are sold by Hynix that customers will still want them. How will Hynix manage this business when the Intel brand and the Hynix brand are quite different in datacenter.

We will have all the details on finances, employees, and management as this deal unfolds and we get information from the affected parties.

We also are presenting NAND and Optane technology and market futures at Flash Memory Summit coming up and we will host Zoom meetings with people to add commentary on the markets and technologies

Call or text to set up a meeting to discuss more

Mark Webb

www.mkwventures.com

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From Intel Website

SK hynix to Acquire Intel NAND Memory Business

NEWS HIGHLIGHTS

• SK hynix will pay US $9 billion for the Intel NAND memory and storage business, which includes the NAND SSD business, the NAND component and wafer business, and the Dalian NAND memory manufacturing facility in China.
• SK hynix aims to enhance the competitiveness of its NAND flash solutions as one of the leading global semiconductor companies and grow the memory ecosystem to the benefit of customers, partners, employees and shareholders.
• Intel will retain its Intel® Optane™ business and intends to invest transaction proceeds in long-term growth priorities.

SEOUL, Republic of Korea, and SANTA CLARA, Calif., Oct. 20, 2020 — SK hynix and Intel today announced that they have signed an agreement on Oct. 20, Korea Standard Time, under which SK hynix would acquire Intel’s NAND memory and storage business for US $9 billion.

The transaction includes the NAND SSD business, the NAND component and wafer business, and the Dalian NAND memory manufacturing facility in China. Intel will retain its distinct Intel® Optane™ business.

More: Frequently Asked Questions

SK hynix and Intel will endeavor to obtain required governmental approvals, expected in late 2021. Following receipt of these approvals, SK hynix will acquire from Intel the NAND SSD business (including NAND SSD-associated IP and employees), as well as the Dalian facility, with the first payment of US $7 billion. SK hynix will acquire from Intel the remaining assets, including IP related to the manufacture and design of NAND flash wafers, R&D employees and the Dalian fab workforce, upon a final closing expected to occur in March 2025 with the remaining payment of US $2 billion. Per the agreement, Intel will continue to manufacture NAND wafers at the Dalian Memory Manufacturing Facility and retain all IP related to the manufacture and design of NAND flash wafers until the final closing.

With this acquisition, SK hynix aims to enhance the competitiveness of its storage solutions, including enterprise SSDs, in the rapidly growing NAND flash space, and further aims to leap forward as one of the leading global semiconductor companies in the industry. SK hynix expects that the transaction would enable SK hynix to grow the memory ecosystem to the benefit of customers, partners, employees and shareholders.

As the global leader in the semiconductor industry, Intel possesses industry-leading NAND SSD technology and quadruple level cell (QLC) NAND flash products. For the six months ended June 27, 2020, NAND businesses represented approximately US $2.8 billion of the revenue for Intel’s Non-volatile Memory Solutions Group (NSG) and contributed approximately US $600 million to NSG operating income.

SK hynix developed the world’s first Charge Trap Flash (CTF)-based, 96-layer 4D NAND flash in 2018 and 128-layer 4D NAND flash in 2019. SK hynix will combine Intel’s solutions technology and manufacturing capability in order to establish a higher value-added 3D NAND solutions portfolio including enterprise SSDs.

Intel intends to invest transaction proceeds to deliver leadership products and advance its long-term growth priorities, including artificial intelligence, 5G networking and the intelligent, autonomous edge.

Intel and SK hynix will work together to ensure a seamless transition for customers, suppliers and employees. The two companies will work collaboratively, as they did recently with DDR5, to better serve the growing demand from the memory-based semiconductor ecosystem.

“I am pleased to see SK hynix and Intel’s NAND division, which have led the NAND flash technology innovation, work to build the new future together,” said Seok-Hee Lee, chief executive officer (CEO) of SK hynix. “By taking each other’s strengths and technologies, SK hynix will proactively respond to various needs from customers and optimize our business structure, expanding our innovative portfolio in the NAND flash market segment, which will be comparable with what we achieved in DRAM.”

Bob Swan, Intel CEO said: “I am proud of the NAND memory business we have built and believe this combination with SK hynix will grow the memory ecosystem for the benefit of customers, partners and employees. For Intel, this transaction will allow us to further prioritize our investments in differentiated technology where we can play a bigger role in the success of our customers and deliver attractive returns to our stockholders.”

When is a NAND stack not a stack?

With some recent technology advances in NAND memory, I am seeing a lot of confusion on the use of the term "stack". I will attempt to give a simplified view on different definitions.

If you are a wafer processing expert, you can ignore this overview blog and we can argue details and pros/cons by Zoom.

OVERVIEW OF STACKS AND NON-STACKS

• Die stacks: This is where we stack one NAND die (a silicon chip) on top of another, wire bond it out and put it all in one package. we have been doing this on memory for well over 20 years. 16 die stacks are available from everyone so if our base die is 512 Gbits, we can get a 8Tbit (1Tbyte) package.
• Pros: more memory in a package 
• Cons: cost is cost of 2 die plus packaging and test cost (its not a cost reduction)

• 3D NAND layers: These are not stacks but some people still use the term. NAND Layers are "stacked up" on wafer in a series of depositions and then a channel hole is made through the "stack". we are shipping ~96 Layer NAND today 
• Pros: as you go from 64 to 96 Layers you get ~50% more bits for an additional process 10% cost adder (oversimplified). so its a big bit cost reduction
• Cons: etching that hole and filling it and making it all work is not that easy (see next)

• String Stacking: If you want to go from 64 to say 128 Layers but you cannot etch and fill the hole, you can do it in two steps. Do 64L, dep and etch hole and fill. Then do another 64L dep etch and fill hole. This is string stacking and everyone but Samsung has been forced to do this so far. Samsung will do it in the future.
• Pros: you get your layers increased and lower cost
• Cons: two step approach is more expensive than single stack (say 5%)

• Wafer bonding: Instead of doing die stacks, you can bond (call for details) two wafers face to face, then dice them. This is used for wafer that are not the same technology process. YMTC is now doing this on their Xstacking process for 64L. 
• Pros: you get logic and array "stacked" on top of one another for small die size and each wafer optimized
• It is expensive, complex, and requires additional post stack processing

There are processes with interposers like HBM used for DRAM, TSVs, stacking DRAM on NAND and a processor.... etc but I will save those for a different blog. 

I prefer the terms I use, but it is important to not get these confused as the benefits and cost are completely different

I can go through details on cost for each and how they are done and complexities. These provide much of the competitive strengths of each company. Call/email for more info

Mark Webb

www.mkwventures.com

Is memory like water, hand sanitizer, or TP?

While shopping recently, the interesting human behavior got me thinking: "which product matches DRAM and NAND supply and demand?".  Is it toilet paper, hand sanitizer, or water?










A few weeks ago, I went to a Target shopping for basics. I don't shop at Costco and buy a month ahead of time, I get a few times a week and just buy what I am about to run out of (I am a big fan of vendor managed inventory). I went to the paper towel and toilet paper aisle and it was empty. I had no idea why. I called a friend and said "is Target going out of business? whats up?" I was informed that there was a run on products due to COVID-19. Luckily for me, the grocery store down the road had tons of paper products, so a picked up some.  A few days later obviously things got a lot worse.  My reaction was "go to store, get a ton of everything, this is a survival competition.... whoever gets the most stuff wins " ... I am an engineer ... but I am still human. Note: I have literally seen the supply chain manager for a hyperscale company do the exact same thing.

In the 2-3 weeks since, supply and demand forces kicked in and.... from this...  we can learn a lot about commodity markets like NAND and DRAM (Yes, kids, memories are a commodity).

Water: 
Bottled water was a quick one to go from all  the stores.  "what? there is no water? then I need more!" I was at a Dollar Tree where a customer came it and said "I want to buy all the bottled water in the store" ... the manager spent the next 30 minutes loading it into a truck. We had a shortage for about 2 weeks and then... funny thing happened. My grocery store stacked water to the roof on 3 aisles. No more shortage. No more people buying pallets of water.

SUMMARY: Real demand didn't increase. People are not drinking more water. The fear increased so people want more and bought tons to add to their inventory. The greater the shortage, the more they want. Once the supply increased, the fear was gone, people say "OK I will just buy water when needed."

Toilet paper:
Toilet paper is running short and last time I was at stores, the shelves were still empty.  It is being rationed and people are ordering on Amazon with a deliver time of late May. Unlike water, stores have not been able to increase supply fast enough so the panic continues.

SUMMARY: Real demand didn't increase. People are not using more TP. The fear increased so people want more and bought tons to add to their inventory. The supply did not not increase, the fear is still there. When this is over, what do you think will happen to TP sales?

Hand Sanitizer:
Hand Sanitizer is running short and last time I was at stores, the shelves were still empty.  People are ordering on Amazon with a deliver time of June. People want more and unlike water, stores have not been able to increase supply fast enough so the panic continues

SUMMARY: Real demand  DID increase. People are using more Sanitizer .The fear increased so people bought tons to add to their inventory AND to use. The supply did not not increase fast enough, the fear is still there. When supply is there, people will probably use more hand sanitizer for a year or more.... maybe forever.

These give examples of what happens with memory. Because price gouging is illegal in groceries (but not memories???) price didn't affect most groceries. When there is a shortage, everyone wants more to store for inventory. Sometimes supply can adapt, sometimes it cannot. Sometimes real demand increases.... often it does not. Lots of discussion on what is happening today and next year in DRAM and NAND to follow up on this.


Next we can discuss supply dynamics of Masks, ventilators, gloves and whether they should or should not (considering microeconomics input only) build more factories. Spoiler alert: It is like NAND, NOR and DRAM capacity planning.

Mark Webb
www.mkwventures.com

Top Memory/Storage items from Recent Earnings

We had earnings announcements from Seagate, WDC, Hynix, Samsung, WDC, STX, Intel, AMD and others. Lots of new data and predictions for you. 2020 is not going to be dull.

• Everyone says memory cycle downturn has ended. But how fast will we recover and how good will it get? Will DRAM prices skyrocket? Should we party like its 2018? 
• Supplier inventories are “near” target (except for Micron who is stockpiling for NAND overhaul). Now FINALLY we have a fair starting point for pricing discussions and supply agreements. And customers need to plan their inventory level targets.
• Speaking of customers…. Datacenter Giants (not to be confused with the Datacenter Dinosaurs who also exist) will buy and build big…. Then take a hiatus and digest the infrastructure build much to the dismay of CPU and memory companies… then build again.
• Everyone’s 2020 bit demand growth is approximately aligned (within 5%) but is the number good or bad for EPS growth?
• WDC and STX are making more money on HDD and the technology is marching on. At this rate, HDD bit ASP will be ZERO by 2025 (just kidding, I should have used a log graph). But we ARE poised to have the SSD to HDD bit price ratio INCREASE just like in 2017.
• Optane DC persistent memory (DIMMS, 3D XPoint)  IS  cheaper than DRAM and has great performance….  but is still growing slower than expected despite Intel success in Cascade Lake ramp. When will this change? When will CXL help here? 
• New DRAM and NAND memory technologies are coming out and how they achieve cost reductions is different for each company. The NAND cost leader will change in 2020
• China Virus and trade issues will either hurt or help memory manufacturers depending on who you ask. We predict the average of those two scenarios!

Mark Webb

www.mkwventures.com

5 Things to Look for in Persistent Memory this week!

With Persistent Memory Summit coming up this week, I am posting Five items for people to look for in evaluating persistent memory solutions and trends. I will be at the Summit so please feel free to argue with me in person!

• A couple years back at the PM summit, Jim Pappas was adamant on stating that persistent memory is here today, right now, and is not a mythical future item (which it really had been for many years). I love that focus. There is enough real stuff to look at without getting sucked into tomorrow’s possible technology. Review where NVDIMMS, RDMA/NVMoF, Optane/3D XPoint, etc are today and how they are being implemented. We can discuss the mythical future technologies afterward over drinks!
• At Flash memory summit, we provided our definition of persistent memory which references a PM summit paper from 2 years back. The key is that it needs to be persistent, it needs to be accessed like memory and it has to have a reasonable, memory like, latency. I love fast SSDs, but fast SSDs and virtual memory mapping are not persistent memory (IMHO). Look for true PM attributes and applications.
• Intel has put a tremendous amount of work and marketing into Optane DIMMS (Apache Pass, Optane DC persistent memory). Cascade lake has many skus to take advantage of these and Intel has product availability and inventory to support it. Sales of Optane and the use of true PM (app direct mode) is a test case for future market revenue projections. Look for what Intel and their customers are saying about sales and ramp of Optane DC PM. We projected in August 2019 that Intel DC PM sales (DIMMS only) would grow from $700M in 2020 to >$2B in 2024. It FEELS like Intel is slow to meet that revenue projection… but lets see what Intel says when asked (Hint: Earnings announcement is same time)!
• Intel builds on a custom protocol and uses its memory controller to manage persistent memory. The rest of the industry has protocols planned for a more open architecture. NVDIMM-P, CCIX, GenZ, OpenCAPI, CXL are proposed to allow multiple technologies to achieve memory like access and speeds. How are those doing and who is implementing solutions today? Who will win?
• Applications! Everyone is looking for the killer app…. We know of some specific applications of persistent memory (large datasets, quick recovery from reboot, journaling info) but what are the applications that will make is so that 50% of servers MUST have persistent memory? Look for the volumes required and the timing for those.

As you would expect, we have summaries and opinions for most of these topics and more topics like cost, pricing, technology timing and scaling, revenue, etc. Please call or text to discuss.

Mark Webb

www.mkwventures.com

Memory Pricing: Myth, Math, and Reality

With the bottoming of the memory market and reports of NAND price and DRAM price increases, People want to know how all these numbers pan out. No one knows for sure...  But…there are some market forces and reasons why numbers vary

Updated thoughts on pricing models and how to interpret

• Memory is a commodity. Period. 
• DRAM exchange/ Inspectrum is usually directionally correct, but wrong in magnitude and in absolute numbers when comparing to actual company ASP
• Spot pricing is open market and not related to what major customers pay
• Customers react differently in magnitude to increases and decreases in exchange price
• Even reported contract price is not REAL contract price and does not match company ASPs
• Apple does not pay more in price because the exchange price increases unless they think they cannot get shipments. They prefer to get companies into a bidding war. When prices drop, large companies do expect suppliers to cut price…. With or without a pricing contract. And they usually do because it means there is excess supply
• Exchange prices and analyst reports are often for a particular part. That part may increase in price but because it did, people bought a different, cheaper part.
• Hypothetical example: Hynix 256Gbit TLC, 64L NAND price increases 5%. But the recently introduced 512Gbit TLC, 96L Gbit is 15% lower price per Gbit. And the 512Gbit 96L QLC part is 20% low price per Gbit. End result: analyst reported NAND price went up. Hynix company ASP dropped 10%. Both are true.
• Confirmation example: In 2017/18 Micron did not report any annual NAND price increase. In fact, ASP dropped 7% in F2017, 8% in F2018. Similar data for other companies… Yet most people will still tell you NAND prices went up 30-50% during that time. DRAM did Increase 50% during that time for Micron.....  However all exchange prices show 100% price increase
• Actual pricing is a response to market growth, Inventory, and customer relationships. We can discuss how to track these and some basic conversion factors from exchange price to ASP.
• The number one input to memory company profits is pricing.... so anything they can do (legally hopefully) to get pricing to increase will help memory companies. Unfortunately or fortunately, they are just not very good a collusion! but there are legal tactics that they do all the time.
• Cost for each company matters. One model is that pricing always drops til at least one company loses money. Today, not all memory companies have the same cost. In 2021, there will be differences in cost with different leaders than 2019.

Where are we today?:

• We had a shortage of NAND and DRAM through about Q4 2017 and Q3 2018 respectively. Since then both were in major oversupply. Inventory at customers and suppliers skyrocketed. Reports are that inventories are now nearing target. Suppliers report shortages on some line items.
•  Well publicized supply limitations (power outage, Fires, Japanese chemicals, Reduced wafer starts) have people optimistic on pricing. DXI skyrocketed. All of these require discussion to see if they matter and how much.
• Dramexchange has reported spot NAND price increases since April 2019, We are just now seeing companies report modest price increase (they are ALL losing money in NAND so they need to increase price).  Dramexchange has started to report spot DRAM price increases in the last 30 days.
• It is a cyclical commodity market. (did I mention this before????)

So lots of positive reports on pricing these days. The key is how much will companies see and will it last. We track all of the metrics and can discuss how these impact different companies
 

Mark Webb

MKW Ventures Consulting

www.mkwventures.com