DRAM makers trash Microsoft for sales slow down

THE SLOW UPTAKE in Microsoft Vista has been blamed for the price of DRAM dropping lower than a flatworm in the Marianas Trench.

According to "Market Watch", DRAM makers are set to suffer one of its worst business quarters this decade and it is all because they overstocked thinking that there would be a lot of people who would want DRAM for Vista upgrades.

Analyst Nam Hyung Kim from Isuppli said suppliers of DRAM chips "overforecasted Vista demand," and are expected to post a weighted negative operating margin of 19 per cent in the second quarter.

This is the worst things have been since the second quarter of 2003 when the sector had a negative operating margin of 16 per cent. Chipmakers Micron and Qimonda are being badly hit as the average spot prices for mainstream DRAM have tumbled 65 per cent.

PC makers have been cashing in on the cheap prices which have helped profit margins at the expense of the DRAM makers.

Now most analysts do not believe that Vista will have much of a positive impact on PC sales until 2008. [Didn't we write this last week? Ed.]

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