DRAM production in decline

According to IHS iSuppli, the projected cut will be the second year of deliberate downsizing, following an 8% drop off in 2012. "The DRAM industry has struggled with major challenges in recent years, including chronic oversupply and slowing demand from its main market, the pc business," said Mike Howard, senior principal analyst for dram and memory at IHS. "This has led to continued weak pricing, financial losses and market revenue declines." Despite this, Howard says the dram industry has entered a more 'mature' state, enacting structural changes that will allow it to grow even in challenging market conditions. "In one major change, the dram market is adjusting to the fact that demand is diversifying away from pcs alone to servers and mobile devices," he continued. "Nearly 65% of all dram bit shipments went to a desktop or laptop 10 years ago, but that figure is less than 50% today and is expected to fall further to south of 40% by the end of next year."