Friday, June 22, 2001
Memory Stick - the flash card standard?
The de facto standard
Memory Stick - a gum like flash-memory - was first introduced by Sony in fall of 1998. Over the course of about two and a half years, it has managed to capture a market share of 25% in removable flash memory market. What makes the competitors nervous is Sony does not intend to stop right there. Instead, it is building on its momentum and intending to make the Memory Stick format to be widely used in most, if not all, handheld electronics devices.
Recent figures from market researcher indicate that Memory Stick has been gaining market share at the expense of two major competing technologies - CompactFlash and Smart Media. In spring 2000, CompactFlash and Smart Media each held a commanding 51 and 41 percent of the market. Memory Stick trailed far behind with 7 percent. A year later, CompactFlash’s market share has dropped to 40 percent and Smart Media has fallen to 32 percent. Meanwhile, Memory Stick has shot up to an impressive 25 percent market share. What have made the turnaround for Memory Stick within a year span?
Memory Stick received a lukewarm response from the industry developers in its inception because of its inflexibility in royalties and development control. Slow adoption and rising competition has then loosened the Japanese giant’s grip on technology licensing just a year ago to seek more alliances to stimulate demand for the memory card. Since then, Sony has been able to attract more developers to adopt the flash memory standard for their various handheld devices – on top of Sony’s own line of consumer products including digital camera, digital-audio players and handheld personal computer.
Early this year, Sony and General Motors (GM) agreed to jointly develop Memory Sticks for automobiles. The partnership will also involve information sharing systems and application software for automobile, home and office uses. Sony has also licensed MagicGate security and ATRAC3 sound compression technologies to Texas Instruments (TI) and will give TI technical support on mechanical products. In return, Sony hopes to increase its memory card market share through TI’s influence on signal processors for mobile phones.
Lexar, a developer of digital photography products that sells CompactFlash, Smart Media, and Memory Stick formats, said the appeal of Memory Stick is that while it is widely used for digital photography it can also be used in other markets such as audio and printing. Examples include Sharp’s MP3 player which has built-in Memory Stick slot, car audio maker Alpine’s in-dash player that comes with memory stick, and Epson’s latest printer products that support the Memory Stick.
To further extend its memory card usage, Sony has joined the IA Alliance and established the Taiwan Sony Memory Stick Forum (TSMSF) to assist the transfer of Memory Stick technology to companies in Taiwan. With the companies’ position in the manufacturing market, the industry observers believe Sony will be able to rapidly expand the Memory Stick’s applications into different fields.
In May of 2001, total shipment of Memory Stick cards has surpassed the 10 million units mark from 157 licensees, according to the market researcher. While Sony is making inroad to capture more market share, other competing flash memory manufacturers are not standing still without any fighting back.
Secure Digital (SD) - Make or Break
One of major contenders is Toshiba that has been aggressively pushing its own Secure Digital (SD)* and Smart Media Memory Card technologies. Toshiba see the next 18 months as the potential make or break period for the SD Card format as it battles against the Memory Stick format developed by Sony and the Secure MultiMedia Card backed by Hitachi, Sanyo, and Infineon Technologies. While the Secure Multimedia card is strong in the mobile phone applications, Toshiba believes the improved SD flash memory card format will win or lose the battle in the domestic Japanese market, a strong foothold for memory stick.
The SD Card does have some powerful backers including Sandisk and Matsushita. The presence of Matsushita and how quickly can it introduces its National/Panasonic brand of electronic devices to support SD format is deemed critical to the success or failure of this memory card standard.
Secure Digital Flash (SD) – A new format created by Toshiba, Matsushita Electric and Sandisk, SD includes a proprietary security function in both hardware and software, a feature necessary when music industry make the contents accessible over the internet. It is compatible to Multimedia Card but is considered a better option with the security feature. It also supports stack memory format.
The most promising markets for flash memory card are emerging applications in digital cameras and MP3 audio players. Although demand for flash memory by telecom manufacturers in not going away, there is clearly a shift in demand drivers to more consumer-oriented applications, especially after the recent telecom slump. Most of the removable flash cards will still be consumed by the cell phones and PDA even though the demand for the new cell phones and PDA lately is not as upbeat as many have been anticipated. Compactflash and Secure MultiMedia cards have long have a strong foothold in cell phones market while SmartMedia and CompactFlash serve well for PDA. Thus, Sony has an uphill battle to not only capture the emerging applications market, but also to find ways to get its Memory Stick into the cell phone and PDA markets.
Will Memory Stick stay in the game and emerge as the de facto standard for the handheld devices? Not likely, but it will sure be one of the top players in the competitive and non-standardized flash memory card market.
Source: Wee-Feet Research