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Samsung expects chip market recovery in H2

Samsung Electronics Co, the world's largest memory chipmaker, expects demand for computer memory chips to recover in the second half of the year, helped partly by wider adoption of Microsoft Corp's Vista operating system, a company executive said yesterday.

Samsung said rising demand and wider application would materialize in the second half of this year -- or about two quarters after the launch of the consumer version of Windows Vista in late January.

"Demand in the first half is slow [but] demand will be strong in the second half," Hwang Chang-gyu, president of Samsung's semiconductor business, told a press briefing in Taipei.

Aside from the Vista effect, demand for dynamic random access memory (DRAM) chips, including for mobile phones, would support the recovery, said Hwang who was in town for the Samsung Mobile Solution Forum.

Worldwide shipments of personal computers are expected to increase 11.7 percent to 255.4 million units this year, compared with 228.6 million units last year, slightly better than the 10 percent annual growth last year, based on market researcher International Data Corp's forecasts.

Computers outfitted with Windows Vista require ample memory storage and high speeds to support its full range of multimedia function, Hwang said.

A typical Vista computer requires about 1GB of memory storage, compared with 512 megabytes for a computer running Windows XP, he said.

Hwang added that the memory requirement was expected to increase to 2GB in the second half of this year.

Hwang also expressed optimism about developments in the NAND flash memory market.

Samsung has seen clear signs of a recovery with demand recovering and prices stabilizing after a sharp drop earlier this year, Hwang said.

"Demand will be strong in the second half," Hwang said, adding that the company expects a supply shortage for the full year.

Sales of NAND chips may pick up strength starting next quarter after new products, such as music phones with big 4GB or 8GB storage, and video-enable MP3, hit the market, Hwang said.

Samsung also announced yesterday it has developed the industry's first fusion semiconductor that combines two different types of NAND flash memory -- single-level cell, which allows for quick data processin,g and multi-level cell, which is suitable for storing large amounts of data -- into a single set.

Called the Flex-OneNAND, the fusion semiconductor can help make mobile phones and multimedia gadgets much more compact at cheaper prices, the company said in a statement.

Additional reporting by AFP
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