Thu, Oct 23, 2003 - Page 10 News List

SanDisk expects to rake in cash on flash-memory

By Jessie Ho  /  STAFF REPORTER

SanDisk Corp, the world's largest supplier of flash-data storage products, said it expects to see huge revenues generated from its new products, including the world's fastest flash-memory cards, which it launched yesterday.

"I believe there is huge market opportunity for our products following the prevalence of various electronic devices such as digital cameras," Nelson Chan, senior vice president at SanDisk's retail unit, said yesterday at a press conference.

Purchases of digital cameras, which store photos on flash-memory cards, have seen continued growth. Chan said some 41 million digital cameras will be sold this year and the figure is expected to increase to 71 million in 2005, citing statistics provided by the international research company International Data Corp (IDC).

Chan said the company is also targeting the continuing boom in multimedia cellphones to sell its staple memory cards. The so-called SD memory card is a postage-stamp-sized device jointly developed by Matsushita Electric Industrial Co, Toshiba Corp and SanDisk.

IDC forecasts that 125 million multimedia mobile phones will be in use by 2005, so the expected demand for memory cards will jump from 92.8 million units this year, to 197.8 million, or a stunning 113 percent growth, in 2005, Chan added.

The California-based SanDisk, which has established over 50,000 retail stores worldwide, has developed a number of data-storage devices used for consumer-electronics products. Its universal serial bus (USB) flash drive, also known as a pen drive, hit the market recently.

Joseph Yeh (葉永泰), a senior analyst at the semi-government Market Intelligence Center (市場情報中心), said he agreed with SanDisk's outlook for memory cards, given the rapid growth in digital cameras, but he said it takes longer for the device to be applied in cellphones.

Yeh also suggested the company not be overly optimistic, as its earnings will lessen amid fierce competition.

"This is a phenomenon that applies to all kinds of high-tech products, particularly standardized ones," Yeh said. "Consumers usually have little loyalty for this category of products ... just like many people still tend to buy the cheapest floppy disks on the shelf."

But Alex Chan (陳財漢), the company's retail sales manager for the Asia Pacific region, yesterday said he has confidence in the attraction of SanDisk's brand name.

"We can absolutely sustain our place in the market, even if our counterparts launch a price war ... because we have a price-edge over them," he added.

Sales of SanDisk memory cards in Taiwan outperform other markets in Asia. But China may soon overtake Taiwan, as SanDisk is eagerly expanding its market share in China over the next 12 to 18 months, Chan said.

SanDisk's sales rose from US$366.3 million in 2001 to US$541 million last year, and is expected to climb to US$950 million by the end of this year. In its competition with such firms as Sony Corp, Samsung Electronics Co and Toshiba, SanDisk was able to grab about 27 percent of the global memory-card market last year.

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