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News

Report: Apple Places Large Flash Memory Order

Apple has placed orders for Flash memory large enough to constrain supplies and drive up prices for other manufacturers, according to a report from Taiwan-based newspaper DigiTimes. The paper reported Friday that Apple had placed orders for 100 million 8Gb NAND flash chips, with most of the orders going to longtime Apple supplier Samsung Electronics.

The report comes ahead of an expected update to Apple's iPhone product line this summer, adding fuel to the fire for those speculating that the device will soon include more memory, though the chips could certainly be used in the company's popular iPod line, as well.

Big(ger) Pictures

What shouldn't be lost from this story, though, is that Apple's ability to negotiate such large orders allows the company to secure pricing that its competitors can't get. The DigiTimes report said, for instance, that supplies of these 8Gb chips will be tight until the end of May, a fact that will drive prices higher.

Securing memory for the company's iPod line is one of the reasons why Apple, not known to be a value-pricer, has nonetheless been able to consistently have its iPod products compare very favorably to the competition in terms of price.

For instance, at Amazon.com, you can buy a 120GB iPod classic for US$224.95, or a 120GB Zune for $229.95. Alternately, you can buy an 8GB iPod nano for $133.95 or an 8GB Zune for $128.97. In terms of features and price, Apple has been able to keep its iPod line very competitive with the competition.

(Note that we also found some 8GB MP3 players that, while they retail in the same pricing tier as the Zune and iPod nano, were selling on Amazon for under $100.)

2 comments from the community.

You can post your own below.

Bosco (Brad Hutchings) said:

It’s obvious what they are doing. They are going to release limited edition 8TB iPhones and iPod Touches. Well, if you call 50,000 of each a limited edition.

   Quote

cpetrauskas said:

Please note that an 8GB chip represent 1GB of device storage not 8GB. That really makes this an unusual purchase.

C.

   Quote

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