Abstract
After the financial tsunami in 2008, Taiwan's dynamic random access memory (DRAM) industry fell into an unprecedented crisis﹒Since long ago the DRAM industry has been facing the critical issue of supply and demand﹒After the financial tsunami﹐global demand and price keep dropping which caused the huge losses of Taiwan’s DRAM manufacturers﹒The total losses accumulated for Powerchip, Hwaya and Nanya is NT $ 56.715 billion in the first three quarters of 2011, besides ProMOS’s losses is hard to be predicted and facing the risk of bankruptcy in any time﹒Even Rexchip is the only one player with profit in the first half of 2011 showing a turn from profit to loss over NT$ 3.278 billion starting from the third quarter﹒Due to suffering from impacts of Europe’s debt crisis and global economics recession, the DRAM prospects of the fourth quarter will be getting worse﹒DigiTimes predicts the total loss of Taiwan DRAM manufacturers will be more than NT $ 100 billion in 2011﹒ The major reasons of loss for Taiwan DRAM manufacturers are the lack of own technology and backward production process, thus the cost can’t compete with Samsung, Hynix of Korea, Elpida of Japan, and Micron of U.S﹒Under the unclear and changeable DRAM market, without the advanced NAND Flash manufacturing technology, Taiwan DRAM companies are not capable of switching production to NAND Flash and keep staying at the position of huge loss of DRAM . Powerchip,the major DRAM supplier for small and medium sized Taiwan memory module houses and occupied 70% of Taiwan DRAM spot market, was announced to reduce DRAM capacity in November 2011 and maintain the proportion below 20% permanently to transfer into wafer foundry business and NAND Flash production﹒Under the supply-side changes, small and medium sized memory module houses how to adjust their competitive strategy to survive well in the post-PC era and the trend of the big get bigger in module industry？That is the focus of concern in this study﹒