Gartner Says Worldwide Flash Card Market Will Grow 38 Percent in 2003
STAMFORD, CONN., September 11, 2003 — Despite declining NAND flash memory component prices in the first half of the year, the worldwide flash card market is poised for strong revenue growth in 2003, according to Gartner, Inc. (NYSE: IT and ITB). The worldwide flash card market is forecast to reach $2.75 billion in 2003, a 38 percent increase over 2002. In 2002, worldwide flash card revenue totaled $1.99 billion.
"Recent NAND component price declines in 2002 and the first half of 2003 have helped proliferate flash cards in the mainstream because an increasing number of consumers are able to justify the cost and benefit argument," said Joseph Unsworth, industry analyst for Gartner's semiconductor group. "The flash card market is overwhelmingly driven by the consumer retail channel and is considered a price-point driven market, meaning consumers are willing to pay for as many megabytes as their budget will allow. As average selling prices (ASPs) begin to stabilize through the second half of this year, the consumer's budget elasticity will play an increasing role in the market in determining megabyte demand and flash card capacity transitions."
Unfortunately for consumers, the flash card industry continues to offer a variety of formats, most which are incompatible with each other. Adding to the confusion is further fragmentation within some formats, resulting in card derivatives that target applications with particular attributes.
"The SD Card and Memory Stick (MS) are forecast to be the dominant flash cards, capturing a combined revenue share of 65 percent by 2007. These formats are expected to prevail because they have strong industry support combined with compelling attributes in a small form factor," Unsworth said.
Gartner analysts said the outlook for the flash card market is promising because the outlook for future applications is strong. Current applications such as digital still cameras, will continue to provide the majority of megabyte consumption in the short term as camera resolutions sharpen, increasing the demand for additional data storage capacity. Future applications, such as mobile phones and digital video cameras, are expected to drive the predicted 81 percent megabyte growth from 2002 through 2007, and fuel the flash card industry to the long term.
"In the longer term, applications will require even more data storage capability as increased functionality and security features are incorporated into flash cards. Advancements in flash card performance, in conjunction with decreasing prices at the component level, will drive new flash card usage in applications such as mobile phones and digital video cameras, providing growth opportunities for the industry," Unsworth said.
Additional information is available in the Gartner Dataquest report Worldwide Flash Card Market History and Forecast Trends, 2001-2007. The report examines key drivers and inhibitors to the flash card industry, as well as trends for the year. This report can be purchased on Gartner's Web site.
This research is produced by Gartner's Semiconductors Worldwide group. This research group combines memory, microcomponents, logic, ASIC, analog, discrete device, RF and optical segments into a complete industry picture. Products, suppliers, startups, technologies, regional consumption, applications and emerging technologies are all covered in this broad program.
More information about Gartner's semiconductor research programs and reports can be found in the Gartner Semiconductor Focus Area at http://www.gartner.com/semiconductor-mkt. To subscribe to this service, please call 408-468-8000. Reports can be purchased on the Internet www.gartner.com.
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