miscellaneous consequences by
editor - StorageSearch.com
September 7, 2017
of the 2017 memory shortages
|Traditionally at this time of year I
cast around for the the strategic threads which have underlied the stories
reported in the SSD market. In 2017 there's no contest. There has been one
factor which has dominated the fortunes and future directions of the entire
SSD and memoryfication market. The memory shortages.|
a long term evangelist
of the SSD market and the rethinking of data architectures which it has
enabled I have been naturally pleased to see that the adoption of solid state
storage has gone so well.
We're now concluding series 19 of the
SSD mouse site and the
story line began before that with a different name but the same
writer. If you
missed those earlier story lines see
why buy SSDs?
- plot spoilers include - side-stepping the Y2K-CPU-GHz barriers to bring us
faster applications processing, lowering the cost of big data and eliminating
the software shackles of one more spin around the rotating media block
which had fattened
latencies and choked host interface arteries due to wasteful
stuffit-just-in-case cache demands. But you don't need to know all those
old episodes to appreciate where we are now.
SSD thinking is now at
the center of all forward looking data architecture projects. SSD technology
is the mainstream. Demand is high.
In many ways that's a good thing.
But it's been a mixed blessing because production of memories has not kept
pace with demand.
Some of the winners and losers from this have been
easy to spot. But there have been new opportunities created by the memory
shortages and higher prices of memory too. This has helped efficiency and
utilization focused technologies to grab a hold on customer minds in ways which
would otherwise have been harder or even impossible if memory prices had merely
followed the decades old direction of travel.
traditional memory makers
If you're one of those who has suffered
from the memory shortages it may seem unfair that despite their
miscalculations and over optimimism the very companies which caused the
shortages of memory and higher prices - the major manufacturers of
nand flash and
DRAM - have been among the
In the first half of 2017
blogging sites were celebrating the increasing values of memory related
companies on particular Micron which is a pure play memory stock.
the upwards revaluing of memory fabs was a great help to the
Toshiba group of companies
which was looking to improve its solvency through the
disposal of its memory business. (Think of how differently that prospect
would have been interpreted if it had taken place against a backdrop of memory
oversupply and plunging memory prices.)
For traditional memory
companies the ability to allocate where its highly sought after memory chips
were going in order to get the highest
establish influence in future strategic markets created opportunities for
classic semiconductor game playing.
In the simplest business terms
if a memory company has a choice of selling at a higher value - such as an
enterprise SSD (instead of a consumer SSD) - then that's what it should do.
Similarly systems such as
AFAs and JBOFs
start to look more attractive than selling drives. In reality none of the
semiconductor companies had invested sufficiently in establishing viable
before the 2017 shortages. But that didn't stop companies like
Western Digital (which
had a stake in Toshiba's fabs) from talking about it as a forward looking
re long time emerging memories
the 13 years leading up to the memory shortages of 2017 there had been a
variety of so called "emerging" alternative memory technologies
including:- MRAM, PRAM, CMOx, PCM, ReRAM and others which at various times
appeared in the SSD news pages - usually attached to a
promise that one day
soon they would fill an applications niche which upto that point had been
dominated by nand flash. The perennial problem with those lookahead promises
was that the density and cost of that pesky flash just kept improving (SLC,
MLC, TLC, 4Xnm to 1Xnm and 2D to early 3D) so that the competitive comparison
tipping point always lay at some point 2, 3 or 4 years in the future.
the smallest capacity flash devices got bigger it was always possible that these
other emerging memories might find small toe holds in the memory cliff face to
which they could cling and attach but unless flash stopped getting better and
stopped getting cheaper this looked to many observers like a race in freeze
frame. The next generation flash was always more competitive than the next
generation alternative nvm.
Aha! But then we had the 3D flash levels
being stacked in a height
busting tottering tower and the whole market edifice came crashing down with
low yields and high prices and the evermore self improvement miracle of the
flash market was caught in the spotlight of having been accidentally
switched to pause.
In a news story in
commenting on this opportunity created by high traditional memory prices I
said... "The unexpectedly higher price of DRAM and nand flash in the past
several quarters due to demand and yield issues has been like manna from heaven
to companies with alternative nvms. The change in relativistic competitive
landscape has had the same effect as if the alternative nvms could time travel 2
years into the future while nand and DRAM have stayed looped in Groundhog Day."
- in May 2017 -
in response to recent steps taken to productize and create sales channels for
Everspin 's MRAM - I said - should we still be calling MRAM - emerging memory?
advantage of the long emerging memories was that they could be manufactured in
fabs which weren't already part of the DRAM / nand flash oligolopoly. And they
were starting to clarify their suited application roles in the SSD and
ecosystem:- as nvm in SoCs,
flash SSDs, low capacity SSDs, high temperature SSDs, persistent memory etc.
The exception was Optane
/ 3DX from Intel Micron which was evolved from and replaced Micron's earlier
development of PCM. 3DX would have to fight internally for wafer starts in
traditional memory fabs. The scale of how those internal priorities would be
decided may be judged by the fact that Micron itself said in an earnings call
in January 2017
that - "3D cross point is a very de minimis amount of revenue in fiscal
2017. We will ship for revenue, but it's actually a fairly small amount and then
we've set the expectation for somewhere around 5% of company revenues in 2018."
And another difference with 3DX compared to other competing alt-nvms
is that it apparently did not look like it would be any easier to make than the
other 3D memories whose yields had caused the memory shortages. In
January 2017 the
CEO of BeSang said
that looking at cross-point structure memories (such as Micron's 3DXpoint) - "is
the worst nightmare for manufacturing".
re efficiency and
utilization - subtext architecture, software and the cloud
I mean here by efficiency?
To put it crudely it's a comparison
about the design and implementation of SSD drives and boxes.
called attention to this important business factor my 2012 article -
internecine SSD competitive advantage. And I have often mentioned it in
stories when praising one kind of design approach compared to another. But even
though I thought this was a desperately important differentiator between
competing product lines (as so did the innovative designers who had designed
such products) you wouldn't have guessed this easily from the external signs
seen in the rackmount SSD market. The reasons being that brand strength and
actual bundled or implied software and services - coupled with the
complexities of different use cases - were just some of the factors which could
hide these internal differences from customers who were buying these systems.
they have guessed anyway - due to seeing different size boxes being offered to
do exactly the same task? Don't blame the user for
SSD box blindness.
All they knew is what they were paying - and they weren't always too
what they getting for their budgets anyway. Perhaps the investors in those AFA
companies should have known - but they were usually the last to know anything.
The street prices of enterprise flash storage arrays had become connected to
chip headcount realities only by the most tenuous of formulas. And truth to tell
- the difference between super efficient and less efficient designs and
didn't matter so much to small and medium users so long as the boxes they were
buying today cost less than the boxes they had bought a little while before.
of les efficient systems could argue - our boxes are more reliable (or some
other distracting excuse) and by a process of waiting time - lo and behold - the
chips got cheaper and the box was more profitable.
As long as you could
buy all the chips you needed it didn't matter if some boxes used twice and many
chips as others.
In contrast - in the mission critical embedded SSD
drive market - where the power consumption of a single slot is looked at by
someone who worries about watts in the box and what they do to reliability - the
efficiency factor was a better appreciated personality trait of SSDs.
let's get back to SSD boxes (hybrid arrays, AFAs etc).
Now in 2017 you
can't get the chips - even if you can afford them. And maybe your customer won't
like the price of the box even if you could assemble it.
starts to matter more.
But there were some other words in the
sub-headline too. Along with efficiency there was utilization.
do I mean by that?
Utilization in this context is a measure of how much
usefulness is delivered at the applications level by a particular raw size of
installed flash. This usefulness benefit is usually delivered by a combination
of software and firmware (and may also include within it a differently tiered
and managed memory architecture). An
of the the benefit can be where an existing flash array is improved to
deliver significantly more reliability, performance or usable storage simply
from a software update alone.
In the best designed systems
efficiency and utilization tricks and tweaks are already integrated at many
levels in the flash array.
Although software vendors like to talk
about hyperconvergence, tiered memory, new stacks, memory defined storage etc -
these can viewed as marketing and branding ideas. They will soon be as quaint
sounding as the 1980s "RISC versus CISC".
During the years
when new technology tricks do something better - their protagonists reap kudos.
From the point of the memoryfication systems industry it doesn't greatly
matter what label is given to a particular technique. The important thing is
that the industry is working towards a better understanding of how to integrate
very large populations of memory chips with diverse characteristics and grouped
in historically defined interface combinations, and creating software bridges
which satisfy legacy applications needs while also incorporating the newer
memory focused demands of big data applications. In 10 to 20 years time all the
best design ideas for memory systems will be mixed up in ASICs or FPGAs and
seamlessly blended in the new standard software stack. The inventors may write
blogs or books about how their IP babies changed the industry - but most people
Returning to the memory shortages... If - like me - you
believe that the industry will most likely remain in a state where demand
exceeds supply for a significant period (years rather than months of quarters)
then the only affordable way that enterprise users will satisfy their needs is
to head towards solutions suppliers which have the best efficiency and
utilization stories to tell.
At its simplest - that will accelerate
integration with the cloud
- because for the past 10 years the cloud and webscale integrators have been ths
companies with the sharpest focus on extracting value from improvment
granularities which traditional box makers didn't care so much about.
there are still huge opportunities in the enterprise box markets for companies
ranging from JBOF to multipetabyte singing and dancing storage arrays to
demonstrate by their pricing and their ability to satisfy shipment demands from
repeat customers - that doing more with less flash is at the core of their
Software companies which promise they can upscale memory
systems to do more with less chips in the box will be hot prospects.
Symbolic IO was much
praised in 2016 before the memory shortages. Their IP is bundled with hardware.
But new memory efficiency partnerships can be software-only or software tied
to a fab.
re hard drives and the memory shortages
Seagate was quick to
squelch expectations in the investor community that a shortage of memory chips
to make SSDs would have a positive impact on the sales of enterprise hard
drives. Although there may have been some small changes of ordering patterns in
the hybrid storage systems base Seagate wanted to dispel
that there is equivalency in these markets and that an SSD sale won is an HDD
This publication has noted that it is realistic for hard
drives to retreat towards safer application roles which are compatible
with but don't aim to challenge the clear and present reality of a confident
SSDwards direction in server and storage markets. (Hard drives in an SSD
And another factor is
We've now in the post-HDD referential era of enterprise software. Most
enterprise applications either doesn't work in a pure hard drive
environment or if it did the performance would be so bad that you wouldn't want
to use it.
In consumer markets particularly in PCs the deployment of
HDDs and SSDs has evolved to be a horse of a different color . Nowadays SSD
based PCs win or lose sales compared to other flash based devices such as
tablets. The hard drive based PC - which survived SSD encroachment better
than the unsuccessful market adaptation of the
hybrid - was
already on its way to becoming a vanishing species with or without nudges
from the 2017 memory shortages.
re SSD manufacturers without
captive memory fabs
The memory shortages of 2017 have highlighted
the differences between those few SSD manufacturers who have their own captive
source of memory and those others (the majority) which don't.
common message I've heard from SSD makers in the latter category is that they
could have sold more SSDs (and SSD based systems) if they had gotten more
supplies of memory.
Another consequence of the shortages is that
those without their own memory fabs have felt the squeeze most from pricing
Long before these recent shortages I had observerd that the
memory fabless SSD companies tended to be those who had better designs and who
invested most in both value added and innovatively efficient designs.
also noted that in times of semiconductor memory gluts the fabless SSD
companies were better positioned to grow market market share while remaining
The memory shortages has been opening up cracks in
SSD business plans which were too heavily predicated on expectations of
An interesting development has been that even
industries which weren't expecting to use the newest generations of highest
density 3D flash - such as the
military markets -
have been hit by shortages in mature planar (2D) memory. You might have
expected them to be immune to leading edge 3D TLC yield problems - because this
is type of memory they are unlikely to use. The cascade of shortages into users
of bigger line geometry components is partly because memory makers were
already underway with hard to reverse plans to migrate most of their
production to 3D before they realized the unprecenteded scale of associated
problems. And also systems companies with SSD product lines which were ready to
ramp to newer memories reacted by extending the shipments of older SSDs with as
much memory as they could get until supplies dried up.
PCs and consumer gadgets
Industry reports said that PC makers were
among the big consumer casualties of the 2017 memory shortages. Were users
going to be happy to pay significantly more for the same old SSD based PC? No
way. They didn't get the choice. The long decline in the PC market due to more
than 10 years of badly designed SSD based notebooks was not an attractive
enough market proposition to warrant high allocations of memory.
the phone market was different.
People love their phones and it's a
crisis if they can't get new ones.
re Samsung's phone business and
For Samsung which at the same time was one of the world's
leading phone makers and memory makers the memory shortages provided
opportunities to increase market share and profitability. (And maybe to expunge
the negative market images of exploding batteries and recalls from its 2016
re Apple's phone business and memory
centered around Apple (the other big phone maker - but without its own memory
fabs - why? - because memory is a commodity Darling - which is also why Intel
stayed so long out of the memory market which it created) the talk and
speculation in the 3rd quarter of 2017 about the effects of the memory
shortages on Apple were split between:-
Apple risk buying memory from its competitor Samsung? (When
this story surfaced in 2016
Samsung was optimistically anticipating a glut in its nand availability.) Or
should Apple join a consortium to acquire Toshiba's memory business - and
thereby secure its memory supplies?
These outcomes were still unknown
at the time of writing this. For samples of the reported Apple memory mood music
asks Apple to join its bid for Toshiba (Sept 6), Apple says it won't
buy Toshiba products if WDC gains control (Sept 8),
in talks with group which includes Dell and Seagate to buy Toshiba (Sep
clarification - re the 2017 memory shortages
you're being pedantic you may ask why did I keep referring to the "2017"
memory shortages in the notes above - didn't the shortages begin in 2016?
right they did. But it wasn't clear in 2016 just how long the shortages would
last and how much of a lasting impact they would make. Based on the experiences
of past memory business cycles and the upbeat messages from the memory market it
would have been reasonable to anticipate a quicker supply correction. That
didn't happen and so instead of being a blip caused the industry's changeoever
to next generation chip capacity - the shortages and higher costs of memory
became the new normal.
how long until there's a correction?
to software mitigation as a memory shortage fixer
July 2017 the
measure of what do we mean by "2017 memory shortages" was
succintly stated by market
research company IC Insights
which said in a report - "DRAM, unit shipments are actually forecast to
show a decline this year (2017). Moreover, NAND shipments are forecast to
increase only 2%."
There you have it. Even after bringing new
production capacity onstream the effect of yield (usable chips versus defects)
is that the number of memory chips coming out of the world's semiconductor
fabs was about the same as it had been the year before. And although a
proportion of these were higher capacity the demands for memory were for both
more chips and higher density chips.
I dealt at length with "no
easy fix at the fab level" nature of the flash memory shortages in a
blog in July 2017 - 3D
nand fab yield - the nth layer tax - are more dimensions of analysis needed to
get a clearer picture of future 3D nand successions?. That analysis
underlies my belief that for the remainder of 2017 and 2018 we can't
realistically expect the semiconductor memory market to return to oversupply
and plunging prices from efforts and resources under its own control.
read this far you won't be surprised that I think the biggest contribution to
mitigate pain for users and producers of memory systems will come from
better architecture based efficiencies and firmware and sofware based
utilization improvements rather than
precise deposition in the wafer fabs.
By their very natue (being
tightly coupled to controller IP and software cycles) these solutions will take
time to prove their worth and further time to gain wider market acceptance.
Think of it as a software correction to this memory supply cycle problem and
you'll get a better feel for the dynamics. This is completey different to the
traditional semiconductor fab based (tweak the machinery settings to up the
yield) which provided quick market corrections in past decades.
- the main fault with this new article is that it's too short and as with
all my new blogs has been published with its rough edges still visible. I'm
confident that I will find much additional material to add to it as the memory
shortages of 2017 unfold into 2018. And if I am in a position to do so I promise
to write a retrospective look back from the post shortage viewpoint when that
PCIe SSDs was the only
mainstream category of SSDs which increased shipments in Q3 2017 compared to the
previous quarter according to
market research company
TrendFocus - reported in
SSD news - November
Editor:- January 25, 2018 -
Since writing the article above there have been 5 months of news in which there
have been more examples of changes in the industry which I have interpreted
in my editorial as having been strongly influenced by the memory shortages. Take
a look at the archived
news for more details. Here are some snippets:-
- October 2017
announced a $95 million funding round round. (The shortages were a big boost
to the projected longevity of hybrid arrays with HDDs inside).
- November 2017
- lots of confirmation that alternative nvm companies were being more seriously
- December 2017
- Diablo closed its
doors. The shortages were a make or break litmus test for their products and
revenue earning abilities. Also stretching the hard drive to eke more life out
of the market - Toshiba sampled 10,500 RPM spin speeds.
Something I didn't write
about was the effect of the shortages on my company as a deeply embedded SSD
ecosystem publisher. Take a look at my new blog -
Did SSD ads
become obsolete because of the memory shortages in 2017?
- January 2018
- Seagate's Multi
Actuator technology was another life kicker for enterprise hard drives (maybe /
maybe not). Kaminario
which had focused on low DWPD AFAs exited the hardware supply business - while
for exactly the same reasons (higher memory costs) -
Violin found that its
high DWPD AFAs now looked more competitive.