In 2004, Kingston Technology managed to maintain its leadership position in the third-party module market and see a 35% increase in revenue, according to marketing and consulting research company iSuppli. Last year was also the first time for fast-growing A-Data Technology of Taiwan to be ranked in the top-three, said iSuppli.

In 2004, Kingston Technology managed to maintain its leadership position in the third-party module market and see a 35% increase in revenue, according to marketing and consulting research company iSuppli. Last year was also the first time for fast-growing A-Data Technology of Taiwan to be ranked in the top-three, said iSuppli.

According to iSuppli, overall sales of DRAM modules, including those from third-party module makers, white-box PC makers and OEMs, grew to US$ 21.7 billion in 2004, up 55% from US$ 14 billion in 2003. This growth rate mirrored the expansion of the DRAM market, which rose by almost 53% in 2004.

The DRAM market’s growth in 2004 was boosted by rising average selling prices (ASPs), iSuppli said. Memory suppliers last year shifted some production to non-DRAM products, depressing growth in DRAM bit production and keeping ASP erosion in check. Meanwhile, demand for DRAM modules boomed in 2004 due to a dramatic rise in corporate upgrades and notebook sales.

According to iSuppli, the third-party DRAM-module market reached US$ 9.08 billion in 2004, a 34% increase from US$ 6.8 billion in 2003. Kingston maintained its place in the market with a 27% share of third-party DRAM module revenues.

A-Data Technology broke into the top-three ranking for the first time in 2004, behind Smart Modular, but ahead of Crucial Technology (Crucial is Micron’s division focusing on Internet sales of memory upgrades). A-Data was unavailable for comment.

Ramaxel Technology, which supplies DRAM modules to up-and-coming Chinese PC maker Lenovo Group, increased its ranking to sixth place, up from seventh place in 2003. Viking InterWorks (15th place in 2003), a subsidiary of Sanmina-SCI, boosted its sales by 63% in 2004, allowing it to reenter the top-10 ranking. However, the biggest sales increase of 141% was posted by Apacer Technology of Taiwan, the fifth largest maker. “Apacer performed well because Acer PC sales were strong last year,” said Nam Hyung Kim, director and principal analyst at iSuppli.

Two more Taiwanese companies in the iSuppli’s top ten in 2004 were Kingmax (staying in 8th place) and Transcend (up one position at 9th). “We’re a little bit disappointed by our position in the current list, because there are some doubts whether it takes into consideration all the differences between the business models of the companies called third-party DRAM module suppliers. However, we’re still very glad to be one of the top ten companies and believe that next time we will rank higher”, said Lawrence Chang, vice president of sales and marketing at Kingmax. This year, Kingmax is looking to reach US$ 300 million in DRAM-module sales and recognizes some opportunities to grow into regions like Europe and Brazil, he added.

Transcend is also hoping to increase their DRAM-module sales this year. According to the company, the number of Transcend’s SMT lines was increased by two at the end of last year to enlarge the production capacity from one million units per month in the last quarter of 2004 to current 1.6 million units per month.

According to iSuppli, the last year was tough, at least, for two Taiwanese DRAM-module makers, TwinMOS Technologies and Power Quotent International (PQI). Both of them reported losses. TwinMOS dropped from sixth place in 2003 to 11th place in iSuppli’s current ranking while PQI moved from 10th position to 17th. “From our personal sources we know that PQI had some legal issues in Taiwan last year, but I’m not sure about the reason of TwinMOS sales decline,” Nam said. TwinMOS and PQI were unavailable for comments.

Looking at the development of DRAM modules and the market, products with densities of 265MB represented 51% of total unit sales in 2004 and will remain in the lead in 2005, iSuppli predicts. The 512MB density will capture 25 % of total module unit sales this year.

iSuppli believes that growth in the DRAM-module market in 2005 will be somewhat flat, rising to US$ 21.8 billion, up 0.4% from US$ 21.7 billion in 2004. “DRAM-module business is very competitive now, and DRAM market growth is declining this year and 2006. Therefore, we will see some industry consolidation,” Nam stated, but refused to comment about any specific company.