Why Do Flash Drive Prices Change So Often?

Flash or USB drive prices for the most part change on a weekly basis. Why is that?

1. Flash memory is only made by a very few manufacturers such Samsung and Hynix, so they control the prices.

2. Memory chips are in everything: tv's, i-Pods, cars, stereos, refrigerators, you name it! So the demand is huge and the supply is limited.

3. 80% of the cost of the drive is determined by the cost of the memory chip, so when the price on the chips increase, so does the drive cost.

4. Large buyers like Apple often buy millions of chips at one time, causing an increased demand and lack of supply. So, prices go up.

But consider this, 16 months ago, a 4GB drive cost around $100. Today, the cost is around $20!

And when you consider the fact that it was just a few years ago that a regular 1GB hard drive cost hundreds of dollars, we really have come a long way in a very short time.

(Do any of you remember the days in the not so distant past when our computers didn't even HAVE hard drives? I remember starting out as a graphic designer with my Pagemaker program on one 3.5" floppy disk and my files on the other. I would have to swap them back and forth when I wanted to save my files! And if you can remember that, you can probably figure out how old I am!!!)

Why are memory prices increasing?

Seems memory prices keep increasing lately. According to the AppleInsider, October 9 edition, the demand for flash memory has outstripped the supply due to the popularity of devices like the iPhone and iPod Touch.

Demand in the third quarter exceeded supply by 1.3 percent, and expected to grow to a 3.3 percent deficit during the upcoming holiday season.

Demand is expected to grow 81 percent in 2010 due to the growth of smartphone sales. It's expected for manufacturers to meet that demand in the first half of the year, but by the end of 2010, demand is expected to outstrip supply again.

We've noticed here the past year that memory prices change on a weekly basis with most of our suppliers. Now with this announcement, it's important to keep in mind that the quote you get on Wednesday will most likely change Friday afternoon.

The Creative J will always do our best to search out the best pricing for your flash memory needs. However, as memory becomes more and more in demand and supplies lessen, our options may not be as plentiful as earlier in the year.