Smartphone and tablet manufacturers are using less NAND flash memory in their devices as growing reliance on cloud storage and streaming media lessens the need for onboard storage, according to a new report from IHS iSuppli.
The research firm says that the average memory capacity per cellphone has declined from 13.2 gigabytes in the first half of 2012 to 12.8GB in units shipping in the first half of this year. That's a sharp turn from rapid growth in the average amount of flash memory used in phones in recent years—including an increase from 4.6GB on average in the first half of 2011 to 13.2GB in the first half of 2012.
Tablets examined by the IHS iSuppli Teardown Analysis Service tell a similar story, though the decline in average amount of onboard flash memory used in slates appears to have happened sooner.
"From the first half of 2011 to the same time one year later, flash memory loading in tablets dipped 25 percent from 32.1GB to 24.0GB on average. The fall during the first half of this year is even greater, down 42 percent as tablet memory skids to 14.0 GB," IHS said in a press release.
The proximate cause of this decline is the growth of cloud-based services, often from mobile device makers themselves, offering storage and streaming services which have "reduced the requirement for large amounts of NAND flash in smartphones and tablets," IHS memory and storage analyst Ryan Chien said.
"Mobile device brands increasingly are offering their own application ecosystems and online storage benefits that perform the same functions as onboard NAND flash. With mobile platforms a leading growth driver for the NAND industry, this trend represents a major cause of concern for flash memory makers."
IHS noted that both Apple's iPhone 5 and Samsung's Galaxy S3 offered the same maximum storage capacity as each products' immediate predecessor, a break from the past, "when a new model from either maker would offer a discernible bump up in NAND flash density options."
Meanwhile, smaller-sized tablets now available offer 50 per cent less onboard storage on average than the 10in tablets that once dominated the market, the research firm said. What's more, many newer model smartphones no longer have microSD slots for expandable storage options, another setback for NAND flash makers.
Some makers of flash memory are looking to solid-state disks (SSDs) for ultrabooks and other laptop PCs as way to make up for declining demand in the mobile device market, according to IHS. However, that's an area where growth opportunities are also murky at best.
Last year, Samsung and Toshiba, two of the leading makers of NAND flash memory, were reportedly considering putting the brakes on their most advanced NAND flash process technologies until demand for SSDs increases and producing NAND flash memory becomes more profitable.
Samsung and Toshiba both have state-of-the-art 12in fabs that produce NAND flash chips but "are mulling plans to decelerate capacity expansion" at those facilities in the face of falling prices for the products they're already producing, DigiTimes reported last July, citing unnamed industry sources.
Samsung's fab uses 21-nanometer process technology and Toshiba's is on the 19nm node. The transition to those technologies has increased the two companies' output of NAND flash chips but both reportedly were wary of further expanding their capacity and possibly causing prices to decline even more.