Mannerisms

Last year NAND prices fell 66 per cent. This year they’ve already fallen a further 50 per cent.

But massive amounts of NAND production capacity are still being added by IM Flash (Intel-Micron), Samsung, SanDisk, and Hynix.

SanDisk is the first player to blink. Cutting the boss’s pay-cheque is a sure and certain sign that things are going awry and, earlier this week, SanDisk CEO Eli Harari took a 20 per cent pay-cut, while SanDisk’s president, and executive vice presidents, took 15 per cent pay cuts.

Amazingly Harari reiterated his belief that investing in more capacity now was a good idea.

What keeps the players throwing their chips on the poker table is the belief that new applications for NAND will come along this year to soak up excess supply and stabilise prices.

For instance Microsoft’s Vista O/S is supposed to boost hybrid hard-discs – a mix of hard disc and NAND; solid state laptops using NAND instead of hard discs are expected to take a lot of NAND; it is hoped that mobile phones will take up to 32GBytes each for video; while all the usual suspects,: set top boxes, GPS systems, digital video cameras, and digital still cameras will all, it is hoped, take more and more and more NAND.

If they don’t, the poker table is going to be a bit of a bloodbath. The chips keep piling up. There’s a clunky coloured plaque being tossed into the pot, that’s the Micron fab in Utah; here’s another big square pearled counter, that’s the Hynix fab at Wuxi; here’s another chunky golden chip being tossed in, that’s the SanDisk/Toshiba fab. What’s that multi-coloured plaque landing on the pile? It’s the new Samsung mega-fab.

And who's that pair of well-heeled gentlemen with a huge golden, pearly, shiny plaque of a gambling chip? It's none other than Taiwanese foundry UMC, and the Taiwan memory company Elite Semiconductor Memory Technology (ESMT), are expected to enter the Great NAND Poker Game in partnership.

Will there be jam at tea-time? Or tears? 2007 will decide.