MID innovates new Internet surfing demand

[Apoptosis]

DRAMeXchange Indicates that MID innovates new Internet surfing demand for the next generation

Taipei, June 11, 2008 --- According to DRAMeXchange, a research on consumers’ feedbacks about handset functionality, majority expressed discontent. About 58% of consumers think handsets cannot fulfill their Internet surfing demand but 48% felt that through handsets, they obtained updated information from Internet. Also, 41% expressed to get online anytime and anywhere, 38% of consumers are willing to pay about US$20 per month for mobile Internet and 37% of consumers think Internet access is vital to their daily life. However, 60% think handset has its physical limitations due to the small screen size. Yet, 24% of them think that notebook is not an alternative as it is too bulky.

Currently most consumers access Internet via notebook and handset. However, the former is not ideal for a high mobility requirement and the latter has physical barriers from screen size. The physical limitations of these two segments thus create a new segment to feed consumers’ demand for a high mobility Internet access environment – MID (mobile Internet Device). Although the concept of MID has been around for a while, but a more clear distinction has just created due to smart phones.

DRAMeXchange analysts indicate that during the recent Computex Taipei tradeshow, Intel has been intensively promoting its MID platform that is powered by Atom processor and Centrino platform. The aggressive push is indeed motivated by a substantial business potential behind MID. There are over 1.3bn of Internet users, each spending about 32 hours on Internet surfing per month. Google is available in over 36 languages and Facebook rolls out over 140 new applications per day. About 1bn of Internet users have Internet network society subscriptions and 1.54mn of them will log on to these “societies” every day, translating to 3bn minutes of online time. The number of users using handset to access handsets is expected to hit 4.9mn in 2009 and expand to 5.96mn in 2009 and 1.28bn in 2010. When the number keeps expanding, it highlights the rapidly growing business potential of MID as well.

MID is a market segment between smartphone and premium smartphone, priced in the range between US$599-799. Basic function on a MID is Internet access, data management and AV file playback, as well as killing dead time via easy access to any kind of social network society. Besides these functions, MID designers have also created proprietary platform for different kinds of information. In this sense, MID also serves as an information exchange media for users to exchange information in a more effective and cost-friendly way.

Most current MIDs are equipped with panels that range from 4.5 to 6 inches. Besides the well-known Windows Vista, MIDs also support Red flag and Linux. MID is actually a device that integrates all Intel key technologies: a 143mmx74mm big SoC that is made of 45nm high-k, supports TdP at 0.6-2.5v only, HD video decode, SDIO, 3D graphics, PCI Express and USB client, all chief communication standards (Wi-Fi/WiMAX/3-3.5G/Bluetooth/GPS) and Centrino platform Menlow. Intel has already planned for the launch of the second MID platform – Moorestown. In addition to the strong hardware support, MID is also likely to be the potential star product as all mobile device hardware and software vendors are all keen on enhancing user experience via advanced functions/designs.

MID adopts SSD as its storage media, with the standard memory density being 2-4GB. When MID market gains stronger momentum, NAND Flash capacity is expected to see a solid filler. After gaining a broad support from HTC and some other major vendors, companies including Inventec, BenQ, Quanta, Compal, ASUS, Elekrobitm, Fujitsu, Gigabyte, Panasonic, Sharp, USI and Clarion have all introduced respective engineering samples during Computex. Many companies from the wireless communication sector have also expressed interest to develop specialize systems. Intel has tied up with Option over Connection Manager, Siano on Mobile TV, Gemtek and Samsung Electro-Mechanics on wireless module for consistent Internet connection. These partnerships have been already acknowledged by leading telecom service carriers including China Mobile, China Unicom, Clearwire, Korea Teleom, NTT DoCoMo, SK Telecom, Sprint, T-Mobile, UQ Communications and Willcom.

Furthermore, DRAMeXchange analysts suggest that the advent of MID has created a brand new customer group that has not been addressed before. It is believed to be a star product if a smooth supply could spur stronger demand and it’s success depends on friendly Internet connection and cost. Whether vendors could enhance MID’s power efficiency is also a critical challenge. Whereas for consumers, unit price, of course, plays a judging role. The prospect of MID should be positive if vendors could address the mentioned issues in short term.

Mainstream MLC NAND Flash product’s average contract price of 1H June appears to have fallen slightly. Meanwhile, SLC's contract price is relatively stable. Resulting from slow season effect and unclear NAND Flash market outlook, most related corporations are observing the next step within this market. Demand and a clearer market picture of 3Q08 could be expected after Taipei Computex Exhibition in early June. NAND Flash price is likely to gradually rebound after June with the coming of traditional hot season demand in 3Q08.

NAND Flash spot price recap, Jun 2-9

In the SLC segment, price of 1Gb stayed flat at US$1.77; 2Gb flat at US$2.80; 4Gb dropped by 2.8% to US$3.42; 8Gb dropped by 1.4% to US$6.80 and 16Gb dropped by 0.2% to US$16.04. In the MLC segment, price of 4Gb stayed flat at US$1.85; 8Gb dropped by 2.2% to US$2.68; 16Gb up by 5.8% to US$4.73; 32Gb dropped by 0.1% to US$10.42 and 64Gb dropped by 2.6% to US$20.05.