Micron Discontinues DDR4 Memory: Ongoing Demand Expected to Drive Prices Up

End of DDR4 Production: What It Means for the Memory Market

The recent announcement from Micron regarding the discontinuation of DDR4 memory production marks a significant shift in the semiconductor industry. While Chinese manufacturers, particularly CXMT (ChangXin Memory Technologies), are poised to meet ongoing demand, it remains likely that prices for DDR4 will rise in the upcoming months.

Transition to Advanced Memory Technologies

Major players in the memory sector are rapidly pivoting towards more advanced technologies such as DDR5 and LPDDR5, driven by substantial demand and potentially higher profit margins. Although DDR4 production continues for now, it is set to decrease markedly over the next few months.

In line with this trend, Samsung recently revealed its plan to cease DDR4 production to focus on the newer DDR5 technology. Micron’s announcement follows suit, indicating a halt in mass production of DDR4 by the end of the year. According to reports from Digitimes, this decline will not be gradual but rather significant, shifting the supply burden largely onto smaller entities like CXMT, which have increased their DDR4 output in recent years.

The Role of Taiwanese Manufacturers

In addition to Chinese suppliers, Taiwanese companies such as Winbond and Nanya have ramped up their DDR4 fabrication capabilities. This strategic expansion is aimed at filling supply gaps left by major manufacturers as they transition away from DDR4 production. The decision to move towards more sophisticated memory types is fueled by the profit potential of DDR5, LPDDR5, and HBM memory, compelling these companies to scale their production operations accordingly.

Future Prospects and Market Dynamics

Micron has recently initiated sampling for its next-generation HBM4 memory, featuring an impressive 2048-bit interface tailored for AI servers. The financial viability of DDR4 appears to be diminishing in the face of these advanced technologies, which is why its production is anticipated to reduce significantly this year.

Despite the shrinking supply, the demand for DDR4 remains robust, particularly since countless DDR4-compatible systems are still operational. However, Sumit Sadana, Micron’s Chief Business Officer, has voiced concerns about substantial supply shortages for DDR4. This could lead to a situation where DDR4 prices push past those of emerging technologies like DDR5 and LPDDR5, despite a lower initial cost from Chinese manufacturers.

For consumers and businesses alike, these developments depict a landscape of evolving technology that underscores the need for adaptable strategies in memory procurement and utilization.

For further details, you can read the article on Tom’s Hardware. Explore more about the announcement and its implications at Wccftech.