The Dawn of the DDR5 Era Brings Great Opportunities for Samsung and SK Hynix

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[Asia Economy Reporter Changhwan Lee] The era of DDR5 DRAM, which boasts significantly faster transfer speeds and larger capacities than existing DRAM, is expected to begin in earnest starting next year. DDR5 has a higher selling price compared to the currently used DDR4, which is seen as a great opportunity for domestic memory semiconductor companies such as Samsung Electronics and SK Hynix.

On the 5th, market research firm TrendForce forecasted that DDR5's market share in the DRAM market will rise significantly from next year. For PC DRAM, the market share this year is less than 1%, but it is expected that DDR5's share will increase to up to 10% next year. For server DRAM, it is projected to rise from 4% this year to 15% next year.

DDR5 is the next-generation DRAM with greatly improved speed and capacity compared to the currently widely used DDR4. The data transfer speed is up to 6400 Mbps (megabits per second), about twice as fast as DDR4's 3200 Mbps. The power consumption is 1.1V (volts), about 9% less than DDR4's 1.2V, while the maximum capacity is 64 Gb (gigabits), four times that of DDR4's 16 Gb.

Samsung Electronics and SK Hynix have already completed product development and are currently coordinating supply with major customers such as Intel. SK Hynix officially launched DDR5 DRAM to the market earlier last month, the first in the industry.

TrendForce explained that since memory semiconductor companies have already completed product development, what remains is for customers like Intel and AMD to adopt DDR5 in their flagship products such as servers and CPUs. Intel, the largest customer, is expected to begin fully integrating DDR5 into servers in the second half of 2021 and significantly expand its product usage in 2022.

The semiconductor industry views DDR5 as a significant help to the domestic memory semiconductor sector, which has recently faced difficulties due to declining semiconductor selling prices. DDR4 had a selling price 1.5 times higher than its predecessor DDR3, and DDR5 is also expected to see a substantial price increase compared to DDR4.

Do Hyunwoo, a researcher at NH Investment & Securities, stated, "With SK Hynix's DDR5 product launch, several memory semiconductor companies are expected to start mass production of DDR5 from the end of this year," adding, "The DDR5 market is expected to grow substantially from next year, raising expectations among related companies."

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