Abstract
In 2002, four of Taiwan’s DRAM module manufacturers are ranked in the top ten in the whole world DRAM module manufacturers. Obviously Taiwan is already the most important production location of the DRAM module in the world. Since DRAM and Flash Memory are both IC memory, and both flash memory cards and DRAM modules are produced with SMT process, the two industries seem to demand for the same core competence. In fact, quite a few Taiwan’s DRAM module manufacturers have already engaged themselves in the emerging memory card market, expect to be able to transfer their good fortune in DRAM module to this new area.It may seem reasonable that Taiwan's DRAM module manufacturers could succeed in the emerging memory card market by simply adopting the technology of DRAM. However this simple extrapolation may not hold if they fail to see the critical difference between these two industries. This research compares the DRAM module industry to the memory card industry. Having Porter's five force analysis serve as the foundation of industry's environmental analysis, it distinguishes the critical difference between these two industries. And then an inference on the competitive strategies of Taiwan's DRAM module manufacturers is drawn based on our analysis.It is clear that Taiwan’s DRAM module manufacturers have not developed any rights on related intellectual property, neither have done anything in determining the standards of card formats, they do not hold technical edge over competitors. The only advantage they seem to have is the efficiency in manufacturing and supply chain management. This research shows that with mass production capability as their chief competitive advantage, they will obtain OEM orders and hopefully gain cash position in order to support and develop USB flash storage products for Taiwan’s market. They will not, and cannot compete with SanDisk and Sony in inter-national market. As for MMC and SD memory card use in cell phone market that has the greatest potential in the future, they do not even possess the key manufacturing capacity. The size of these cards demands for IC packaging as the main method of production, instead of SMT on PCB. And none of the current DRAM module makers possess such capability, for it is traditionally an area dominated by large IC packaging subcontractors, many even larger then themselves, without either technical advantage or market channel control, may pose great threat to three DRAM nodule players. Because, in this case, big international players such as SanDisk can combine directly with IC packaging house to produce and market the products. These does not seem to be a place for others.