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Why aren't SSDs getting cheaper?

New, higher capacity drives should help push pricing down, but better fabrication and a bigger production ramp-up are needed

April 19, 2010 06:00 AM ET
Intel X25-V SSD
Intel recently introduced its lower-capacity, "affordable" X25-V SSD, which sells for $125 for a 40GB model. However, the price per gigabyte is the same as that of its higher-capacity consumer SSDs.

Computerworld - Solid-state drives (SSD) have been among the hottest hardware products for more than two years, with a good deal of uptake within the consumer PC, notebook and netbook markets in response to a precipitous drop in pricing in 2007 and 2008.

The fabricators of NAND flash chips, which are used to build SSDs, took a bath for more than a year beginning in 2007, even losing money on the products they sold. Pricing for NAND flash dropped as much as 60% year over year in 2007 and 2008.

"There was a definite oversupply of NAND. The problem was no one was making money in NAND or the memory industry at that point," says Steve Weinger, director of NAND flash marketing at Samsung, the industry's largest producer of NAND flash chips.

After the first quarter of 2009, however, SSD pricing leveled off and even increased as the economy forced NAND flash manufacturers to stop investing in new equipment and demand outstripped supply.

Research firm iSuppli Corp. says surging NAND flash prices last year hurt what was a booming SSD market. The price of a flash memory chips rose to $4.10 in the second quarter of last year, representing a $1.80, or 127%, increase from the final quarter of 2008.

Now, pricing is expected to flat-line until next year, when NAND flash chip fabricators will be able to reinvest their profits to ramp up production and begin selling higher-density products, industry experts say.

Where SSDs are used

SSDs were originally aimed at enterprise-class environments, with the highest quality single-level cell (SLC) NAND flash chips being used to ensure the highest performance and reliability. However, today, multi-level cell (MLC) NAND flash, which stores more than 1 bit of data per cell and therefore offers higher capacities, is approaching the same performance and reliability as SLC through the use of special firmware in the drive's controller.

The performance advantage for SSDs in the data center is tremendous. A single SSD, for example, can produce up to 16,000 input/output operations per second (IOPS). In comparison, a high-end 15,000-rpm Fibre Channel drive maxes out at 200 IOPS.

"You can replace 10, 20 -- I've even heard of 30 -- spinning disk drives, with a single SSD," says Dean Klein, vice president of memory system development at Micron Corp., a fabricator of NAND flash memory chips and SSDs.

But you pay a price for that performance. The cost of enterprise-class SSDs can be as low as $350, for a Micron realSSD C300 consumer drive that can be used in a server, or as high as $7,000, for an storage array-class drive, Klein says. It all depends on the features and performance you want.

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