Samsung's Flashy Future

Moon Ihlwan

Samsung Electronics President Hwang Chang Gyu loves to liken the sudden growth in demand for flash chips to the California gold rush of 1849. Hwang, who runs Samsung’s chip division, argues that Apple’s iPod Nano--which uses flash instead of a hard drive--is just the first of a wave of mobile devices that will adopt the technology. Nano’s ultra-thin shape was possible thanks to flash chips, which don’t have any mechanical parts and retain data even when a device’s power is turned off.

Now Hwang believes notebook PCs will be a potential killer application for flash chips. On Mar. 21, he rolled out a 32-gibabyte flash drive, which serves the same purpose as a hard drive, saying he expects nearly a third of all mobile PCs to opt for the storage technology instead of cheap magnetic drives by 2009. The flash drive is lighter than a hard drive, reads data three times faster, uses only 5% as much power, and doesn't make those funny grinding noises you sometimes hear from your laptop.

For now, the problem is the price. It's way too expensive for mainstream notebook PCs to substitute flash drives for hard disks. But with flash memory prices dropping by 50% every year, a 32-gigabyte flash drive could cost as little as $200 in 2008 or 2009. A sub-notebook that doubles as a media player and perhaps even a camera might be able to get by with about 10 gigabytes of memory. And a flash drive of that capacity could cost below $50 in a couple of years. Samsung expects the global flash drive market to soar to $4.5 billion by 2010 from $540 million this year. And Samsung, of course, thinks it can grab a big chunk of that.

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