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Home Business

Flash Storage ruined due to factory contamination

by Disha Mitra
February 12, 2022
in Business, Gadgets, Mobile, Tech
Reading Time: 2 mins read
0
Flash Storage ruined due to factory contamination

Source: Reuters

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Japan
Western Digital and Kioxia have been working together for 20 years.
Source: Bloomberg

February 10th: Reports came in stating Kioxia and Western Digital had cut production in two of their plants in Japan. This was a result of the discovery of  contamination in raw materials occurring in the factories located in Yokkaichi and Kitakami, Japan.

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Most likely, this will lead to a hike in price of the materials. Along with it, a further strain on its chain of supply which is supposedly already taxed.

History of Western Digital and Kioxia (Toshiba):

Kioxia, formerly known as Toshiba had partnered with Western Digital two decades earlier, and have been working together since. They collaboration involves manufacturing of memory chips for its products. Both of the companies are listed as the largest producers in the global industry, of flash memory.

How much of the product was damaged?

The severity of the disruption is still unknown. However, Western Digital reported a loss of 6.5 exabytes (6.5. million in terabytes), which would lead to an anticipated reduction of supply. In addition to that, loss of Kioxio’s was also reported. The total loss in product comes to about 16 exabytes, reported by an analyst of ‘Wells Fargo’. The loss was of mainly 3D BiCS flash being produced in these factories. They were primarily used in SSDs and other devices.

The consequences of the damage:

The most obvious result of the damage would be price hikes due to shortage of supply. An analyst in Ace Research Institute, Hideki Yasuda points out the result of rise in prices of flash memory.

The main user devices of flash memory are Apple products such as the Mac, iPhone, iPad and Apple Watch. Flash memory aids in the production of modern solid-state memory in these devices. It would affect the production of these devices.

On the other hand, companies like Samsung and Micron might be able to control their industrial impact by producing their own flash memory. Unlike Apple devices, they can source these equipments from other companies. They have the opportunity to gain from the reduction in supply of Kioxio and Western Digital. An increase in demand for the output of Samsung will boost up their profits.

How will the products be restored?

The two companies are yet to give an aggregate time for when the production activity will be restored. A significant impact of loss of product is reported. About 10% of a quarter’s market consumption is lost, which will be hard to cover up.

Fortunately, a positive insight was brought forward for impacted product line. Kioxia stated that newer 3D flash being produced, would ensure their shipments consisting of the 2D NAND flash not be impacted.

 

Tags: AppleKioxiaStorageWestern Digital
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