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PC DRAM Chips Demand Winding Down

After decades of being the biggest market for DRAM chips, personal computers are finally giving way to smart phones and tablets. According to a report submitted by HIS iSuppli, PC demands for the memory chips have dropped to 49 percent in the second quarter, showing the dominance of smartphones and tablets today.

The research firm predicts that the figure will go down further next year to 42.8 percent. The rest of the demand is shared between all sorts of mobile devices.

Since the successful launch of Apple’s iPad in 2010, PC and laptop sales started to dive, significantly affecting the profits of leading PC makers like Dell and Hewlett Packard.

Chip makers are also affected by the slowing down of demands. Major chip maker Intel forecasted last week that its cutting its production for the current quarter due to lack of demand for its processors.

DRAM chips are used by PCs and mobile devices to store temporary, short term data for faster processing. Hard disc drives and NAND chips are utilized for long term storage of data like movies, email, and music. DRAM chips are very useful in holding and moving data, but they lose their memory when the device loses power or turned off. Increasingly, smartphones have become the center of computing during the last few years and it hugely benefitted memory chip manufacturers.

The third-generation iPad uses a 1 gigabyte DRAM chip, making it a lot snappier when performing functions like its predecessor, the iPad 2.

Although PCs will never be gone for good, DRAM makers like Micron, SK Hynix, and Samsung Electronics, are focusing more resources in developing more improved memory chips for mobiles, according to HIS iSuppli report.

Wall Street investors and executives are not optimistic about the current trend amidst the anticipated release of Microsoft’s Windows 8 operating system this October.

The Redmond company hopes to reinvigorate the fledging PC business by launching its most recent Windows 8 platform on October 26.

source: reuters