Apple May Introduce Laptops That Store Data on Chips

Apple May Introduce Laptops That Store Data on Chips

By Kevin Cho

March 8 (Bloomberg) -- Apple Inc., maker of the iPod music players and Macintosh personal computers, may introduce a new laptop this year that will save data on flash memory chips instead of a hard drive, American Technology Research said.

``Our sources indicate that Apple would like to introduce the product in the second half to further capitalize on its strong MacBook growth,'' Shaw Wu, a San Francisco-based analyst at American Technology Research, wrote in a report dated March 7.

The release date of Apple's lighter and smaller notebook personal computer may depend on how much prices of NAND flash memory chips decline as they are still seven-to-eight times more expensive than hard-disk drives, Wu wrote. Alan Hely, a spokesman for Apple in London, declined to confirm or deny the report, citing company policy not to discuss rumors or speculation.

Samsung Electronics Co. and other chipmakers in the $12 billion NAND flash market are counting on laptops to help fuel future growth of the chips, which have already replaced hard drives as the most common type of storage device in portable music players. Sales of chip-based storage in PCs may surge eightfold in the latter half of the decade, according to Samsung.

``It would be positive for flash memory makers in that new demand can be created from diversified applications,'' said James Song, an analyst at Good Morning Shinhan Securities Co. in Seoul.

Shares of Samsung, the world's largest maker of NAND flash memory, rose 0.7 percent in Seoul. Toshiba Corp., the second largest, rose 5 percent in Tokyo, where the company is based.

Slimmer Products

Semiconductors are smaller than hard drives, allowing electronics makers to design slimmer products. They also process data faster and consume less energy. In 2005, Cupertino, California-based Apple used NAND flash chips to make the iPod Nano, reducing the size of the company's flagship music player by 80 percent.

Suwon, South Korea-based Samsung said in March last year it built the world's first laptop that saves files on flash. It said then that the market for chip-based storage in computers will rise to $4.5 billion by the end of the decade, from $538 million in 2006.

New demand may help ease a glut of the chips that's been driving down prices. Spot prices of the 4-gigabit NAND chip have fallen 38 percent this year after slumping 76 percent in 2005, according to Taiwan-based Dramexchange.com, Asia's biggest spot market for chips.

Still, demand growth for flash memory will increase 152 percent this year, outpacing the growth in supply, according to estimates by Merrill Lynch & Co. earlier this month.

To contact the reporter on this story: Kevin Cho in Seoul at kcho2@bloomberg.net

Last Updated: March 8, 2007 04:04 EST