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USB flash drive shipments nearly tripled last year, to 31 million units, and are set to surge again this year, to 54 million units, according to Web-Feet Research Inc. That growth is attracting attention from semiconductor suppliers.

SigmaTel Inc. said last week that it is sampling a dedicated USB flash drive controller for $2.50 in volume quantities. The first product in the Austin company's GoChip USB mass-storage product line integrates a USB 2.0 device controller and transceiver, and can support up to 2 Gbytes of flash memory. The single-chip solution draws on technology developed within SigmaTel for the MP3 player market, said CEO Ron Edgerton.

"The GoChip controller allows SigmaTel to diversify into a new market using the technology advantages we already possess," said Edgerton, who recently guided SigmaTel's IPO on the Nasdaq exchange.

USB drives are the size of a pack of chewing gum. Plugged into the Universal Serial Bus port on a personal computer or Mac, they give users a way to exchange files such as digital photos and PowerPoint presentations, or to take work home from the office. Computer makers such as Dell now configure systems without a floppy drive for customers who prefer to exchange files via the USB port, or they offer USB flash drives as a complement to the traditional floppy.

Analyst Alan Niebel at Web-Feet (Monterey, Calif.) believes USB drive shipments will hit 100 million units in 2006 or 2007 and will approach $3.9 billion in revenue by 2007, a near doubling of the $2 billion expected this year.

Average selling prices, Web-Feet believes, will go from $38.27 this year for a drive with an average capacity of 318 Mbytes to $35.47 in 2007 for a drive that stores about 900 Mbytes.

The USB drive market now has its own association to promote the form factor. The USB Flash Drive Alliance, formed late last year, includes core members Genesys Logic, Kingston Technology, Lexar Media, PNY Technologies and Samsung Semiconductor. Associate members are Crucial Technology, Microsoft, SimpleTech and Viking Interworks.

UFDA president Steffen Hellmold said the alliance educates consumers at www.usbflashdrive.org and will provide input to the USB Implementers Forum, which sets interoperability standards for USB-connected devices.

By: DocMemory
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