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Hallo liebe Flash Fans. Hallo Gekko. Hier ein sehr guter Artikel zu den Flash Produzenten und in welchen Bereichen sie positioniert sind. Gekko ich hoffe es hilft Dir weiter. Danke auch für das Lob von einigen Postern hier im Board. Dann machts mal gut. Erbse1. ---------------------------------------------------------------------- Awsome SSTI Research From: Eric Ziegler (Cross Post) on Silicon Investor There is a lot of imprecision in the way the flash memory market is perceived. If I were making a low density product with little barrier to entry I would worry about a larger competitor coming in and whittling down margins. I can`t see how low density commodity flash can remain a high margin item forever. On the other hand, high density flash and, in particular, proprietary miniaturized flash cards sporting the latest flash technology and surrounded by a deep moat (the IP) would seem to be a harder market to crack and disrupt. I also believe the demand for flash cards (in multiple forms) will be difficult to flood in the near term because of the mass appeal, the rapid anticipated growth of the target markets, and the protracted state of undersupply we are battling. ******************************************************* Let me start by saying I am long both SNDK and SSTI, so I am not intending to `bash` either company nor the products they produce nor the markets in which they participate. "If I were making a low density product with little barrier to entry I would worry about a larger competitor coming in and whittling down margins." I think you have this completely backwards. Let`s first look at these larger competitors you have mentioned: Intel and AMD are No. 1 and No. 2 in worldwide flash memory market share respectively. Flash currently represents about 30% of revenues for AMD and is in the high single digit percentages for Intel. And never loose sight of the "real over-suppliers": Sony, Matsushita, Fujitsu, Atmel Corp. and especially Hitachi. And now the talk is "IBM`s 1GB Microdrive, the latest in IBM`s range of after-dinner mint-sized disk drives. IBM thinks the new drives will "turn today`s digital still cameras into genuine movie cameras" by almost trebling the storage capacity accessible from a standard Compact Flash Type II interface. (Is this competition for SSTI or SNDK?) AMD just unveiled two new flash memory chips for next generation cell phones that rank as some of the fastest on the market. The 32-megabit and 64-megabit chips will begin showing up in 2001 and 2002 as cell phones increase their functionality. Chase H&Q says: "there is not another company in our mind who is executing better in flash than AMD." Roughly 75% of those sales are from high-density flash memory, which carry better margins. http://www.smartmoney.com/smt/markets/news/index.cfm?story=2… Fujitsu Ltd. & AMD said Tuesday (May 23) that they will build a new flash memory production facility and by the end of fiscal year 2001, the new fab is expected to churn out 13 million flash chips per month. Output will then increase to 52 million pieces per month by the end of fiscal year 2002. By that time, the Fujitsu & AMD joint venture`s total production of flash memory devices will increase to 200 million chips per month, up from the current level of 36 million per month. Toshiba Corp. and SanDisk Corp. also recently announced plans to increase production of NAND flash memory more than sixfold at Toshiba`s joint venture facility, Dominion Semiconductor (Manassas, Va.). And even a Samsung executive said: "We are converting some DRAM production lines [over] to flash memories." So it is fairly obvious that the `giants` are moving into flash, but what kind of flash are they targeting, w.r.t. SNDK & SSTI? You know SNDK concentrates in the data storage segment area whereas SSTI concentrates in the code storage segment, so they are not direct competitors. A data storage device is used to store large amounts of data such as music and pictures whereas a code storage device (read: embedded memory that stores code). is primarily used to store the program code that runs the device. When comparing SSTI & SNDK remember this: currently, applications for flash code storage devices far outnumber applications for flash data storage devices, as supported by the 3/30/00 CSFB report. (No link avail.). SSTI is positioning itself to dominate the code storage market. Silicon Storage has staked out its turf in the "lower density" end of the market -- meaning chips that have anywhere from 512K to 8MB of storage capacity. This is the space being abandoned by bigger flash-memory players like Intel and Atmel, which favor higher-capacity code-storage chips more commonly used in cell phones. But that exodus is a good thing for Silicon Storage. Intel recently announced that they are LEAVING the market FOR LOW-DENSITY FLASH in order to concentrate on the HIGH density market. SSTI is the first (and only?) Intel licensee to supply flash memory products compatible with Intel`s 800 Series Hub Architecture chipsets. "The announcement that Intel selected SST as the first licensee of it FWH architecture indicates that Intel believes that SST has the quality, reliability, and foundry relationship necessary to support this enormous market opportunity. While we believe Intel will license others to participate in this market, it is our belief that SST will have a significant technological lead and cost advantage over its future competitors.."---CSFB 3/30/00 report. And AMD and others have reported new fab construction concentrating on the HIGH density flash market. I have not seen (not to say I haven`t missed it!) one announcement about anyone targeting the low density market. Has anyone seen an announcement concerning low-density fabs coming on-line? So for me it is fair to conclude that there is more evidence that the competition is moving into the high density arena then the low density arena. You also mentioned "...a low density product with little barrier to entry" Aus, this is EXACTLY SSTI`s greatest strength: The company`s proprietary technology and focus on the low-density end of the market should protect it from competitors. SSTI is positioning itself to dominate the code storage market. No one can compete on price (both product AND manufacturing) & quality. "Currently, availability is tightest at 2 and 4 Mbits (density). Getting low-density flash is a major challenge. The ADSL market took off. And cable modems, in the United States and North America, and Internet appliances are selling like wildfire," Eugene Feng (SSTI guy) said. "These devices all require 2- and 4-Mbit flash, and many vendors are walking away from that market since it isn`t very cost-efficient to make." From: June 26, 2000, Issue: 1217 http://www.techweb.com/se/directlink.cgi?EBN20000626S0059 "Most people thought that low density equals low margins," explains chief executive Bing Yeh (CEO SSTI). "That may be true for our competitors, but not for us." Why? The reason is that Silicon Storage uses a patented process known as SuperFlash. "SSTI`s SuperFlash technology is a NOR type, split-gate cell architecture which uses a reliable thick-oxide process with fewer manufacturing steps resulting in a low-cost, nonvolatile memory solution with excellent data retention and higher reliability". SST has over 20 patents on its SuperFlash technology. Importantly, these patents cover not only the flash product itself, but the PRODUCTION PROCESS which is also licensed out to other manufactures, creating a royalty stream. Current licensees include Analog Devices, IBM, Motorola, National Semiconductor, Samsung Electronics Co. Ltd., SANYO Electric Co., Ltd., Seiko Epson Corp., TSMC-Acer Semiconductor Manufacturing Co. (TASMC) and Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC). Therefore any increase by these companies only increases the royalty stream for SSTI…a win-win situation! What is the advantage of this process? The SST SuperFlash technology typically uses a simpler process with fewer masking layers, compared to other flash EEPROM approaches. The fewer masking steps significantly reduce the cost of manufacturing a wafer. Reliability is improved by reducing the latent defect density, i.e., fewer layers are exposed to possible defect causing mechanisms. For a comparison of superiority of SST SuperFlash versus the other major approaches to production see: http://www.ssti.com/superflash/702.html In lay terms, one poster put it simply: "for each technology change, i.e., .50um,.35um, .25um, .15um, etc., SST`s products will always have smaller die and peripheral circuitry than its competitors, such as AMD, Intel, Atmel, etc. You can always shrink the die size for each technology change, but you cannot easily shrink the peripheral circuitry, and smaller die size per unit always means lower cost!" This process brings down costs in part by allowing the company to use smaller die sizes. It also makes for more reliable products, because thick oxide layers on the chips don`t break down as much as competitors. From that same poster: (http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=13968… If a price war does come, it would be with "high-density" Flash, not SST`s segment market, again, if you understand the value of "SuperFlash", then you would see SST`s value proposition. So called "high-density" really is a moving target, today`s high-density is tomorrow`s low-density, and due to SST`s lower cost structure due to "SuperFlash", it can always dominate its chosen market and others will move away because they are not price competitive. You are seeing Intel and the others are doing just this now… In the end what we are interested in is the almighty Share Price. From the last report, SSTI`s margins are rising to 41.5%, an 11.2% increase over the previous quarter. With such a tight supply, you can expect margins to increase further. And remember that SSTI is growing revenues from a smaller base than SNDK. SSTI has considerably less # of outstanding shares and therefore has potentially better revenues / share metrics than SNDK (IF the nominator grows!). With similar gross margins and revenue % growth rate, SSTI will translate to better EPS. The market pays for growth and you are seeing this reflected in the share price. Look at the growth numbers, but don`t forget to factor in the recent announcement from SSTI (300% growth…) Jun-99 Sep-99 Dec-99 Mar-00 SNDK Revenue 52.5 67.5 82.7 109.4 Sequential Growth 19% 29% 22% 32% YoY Growth 68% 111% 63% 148% SSTI Revenue 23.0 35.1 48.3 62.3 Sequential Growth 25% 53% 38% 29% YoY Growth 37% 94% 167% 240% And finally, remember that "The postage stamp-sized SD Card, developed by Matsushita, Toshiba Corp and U.S.-based SanDisk Corp" means that SNDK is in a three way split for profits… Please everybody, do not get me wrong: I love SNDK as evidenced by my investment in the company. But this "low density - low profit - greater competition" theory is, IMO dead wrong. Hope I have helped & good luck to all, Eric ---------------------------------------------------------------------- |
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| aus der Diskussion: | Silicon Storage (2) Flash - Memory Speicher |
| Autor (Datum des Eintrages): | Erbse1 (28.07.00 07:10:51) |
| Beitrag: | 14 von 140 (ID:1430607) |
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