The inventory of eMMC devices has risen along with an increase in NAND flash inventory, prompting chip vendors to sell the embedded memory for a low price, according to industry sources.
Demand for eMMC devices has been weaker-than-expected since the third quarter of 2013 due to a slowdown in high-end mobile device sales, as well as disappointing tablet sales in China, the sources observed. Chipmakers have seen their eMMC inventory levels hike, and therefore started to dump their stocks for a price that is even lower than a NAND flash chip price , the sources said.
Dedicated memory module houses and flash controller suppliers have undertaken measures to mitigate the impact of the increased eMMC inventory and stop prices for the embedded memory from falling further, the sources noted. As eMMC is a hybrid device combining NAND memory with an embedded flash controller, several companies have converted the embedded memory into a USB 3.0 flash device solution by adding a chip card reader or a USB 3.0 controller chip into the structure, the sources said.
At the same time, major module firms including Kingston Technology, SanDisk and Transcend Information have turned to an aggressive strategy to accelerate the market in transitioning from USB 2.0 flash drives to the latest generation USB 3.0 drives, the sources indicated. The push could help boost the penetration rate for flash drives with USB 3.0.
Previous reports cited industry sources as saying that Kingston was looking to expand its purchases of USB3.0 flash drive components. The penetration rate for flash drives with USB 3.0 has improved to only 15% in the second half of 2013 from about 10% in the first half.