Dram, The Worst Commodity Business

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DRAM, the worst commodity business|
Merger of Micron and Numonyx|
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executive director Summary
The store chips sector is one of the most militant sectors in the semiconductor perseverance. Since 1998, the sector is facing a harsh commoditization line of work due to price war among market players. For fear of graceful knocked out of the game, big players have been making every struggle to argue with constant cost-cutting or economies of scale. On the other side, companies in the sector have also been trying to make strategic alliance through fusions and acquisition. This paper impart psychoanalyse the merger of two major companies in the memory chips industry, Micron and Numonyx. both(prenominal) companies have their own core competencies and strategies in the highly agonistic industry Micron is the guide company in a commodity PC DRAM market while Numonyx is the leading NOR flash maker with the strong presence in a mobile memory market. This paper first presents the industry grace and competitive climate in a glance. It then gives intromission about the two companies and their respective core competences. Lastly, we will analyze the merger from the aspects of economies of scale, customer bases, and technology leadership.



Although the new Micron will still be facing the near-term stress from declining NOR market, we believe that broadly speaking the merger provides Micron an extended business platform to compete in the memory chips industry.
1. Industry Analysis
As part of the semi-conductor industry, memory chips manufacture requires less technology compared to other sectors in this industry such as microprocessors manufacture. Accordingly, memory chip makers are competing generally on the cost of production per chip to stay competitive in the industry. Given the cyclical nature of the business and the comparatively long production lead time, its annual EBIT margin significantly fluctuates, compared to that of other manufacturing companies. Due to relatively less technical leadership...If you trust to get a full essay, order it on our website: Orderessay



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