Memory price hikes ahead for Intel PCs

Prices for the DDR2 memory chips commonly used in PCs with Intel CPUs will begin to rise significantly next month because demand is exceeding supply, according to sources in Taiwan's semiconductor manufacturing industry. 

While upwards pricing pressure already exists, monthly contracts are creating delays of at several weeks before price changes begin to reach consumers.

DDR2 memory is required for most PCs and notebooks that use Intel's latest CPUs, including Microsoft Windows and Apple Mac PCs.

Computers with AMD CPUs currently use the older DDR standard, although AMD will begin to phase in DDR2 by the end of this year. 

"DDR2 prices stayed constant through February," MasterLink Securities of Taipei said in a research note. 

"However, demand shortage in March is confirmed to be around 30 per cent, so a double-digit price increase is expected in the beginning of March."

MasterLink cited local DRam manufacturer Nanya Technology Corp as one of the sources of its information. The expected supply crunch will begin to ease within a couple of months, other sources say. 

Supplies of DDR2 are limited owing to a lack of investment in manufacturing facilities. The key reasons for this are earlier concerns over the unexpectedly slow growth of the DDR2 market, and the much greater profits seen from other types of memory chips, most notably the NAND flash memory used in portable media players like Apple's iPod.

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The online game World of Warcraft generated revenue of about $60m in the six months after its launch in China last year, according to a statement released yesterday by the game's local operator, The9. 

The game earned $26.2m in revenue in China in the fourth quarter, an increase of 15 per cent on the previous quarter.

Although the company did not provide a full-year figure for its income from World of Warcraft, formally launched in China last June, it was the source of well over 99 per cent of The9's revenue in the fourth quarter.

A massively multiplayer online role playing game, World of Warcraft was developed by Blizzard Entertainment in the US, which claims that the game has more than five million regular players worldwide. 

"As of 31 December 2005, approximately 3.3 million paid accounts have been activated [in China]," said Jun Zhu, chairman and chief executive at The9, in a statement.

"In the fourth quarter we attained peak and average concurrent World of Warcraft users of approximately 530,000 and 270,000 respectively."

In addition to its China operations, The9 has a 30 per cent stake in a consortium which began operating World of Warcraft in Taiwan, Hong Kong and Macao at the end of last year.

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Asian companies will generate $161.90bn in revenue from contract electronics manufacturing in 2009, according to predictions.

The region is already the world's largest provider of contract electronic manufacturing services, earning $73.35bn in 2004, according to figures from research firm In-Stat released last week.

A wide range of famous brand name products from US, European and Japanese vendors are manufactured by OEMs in Asia, particularly in China, Taiwan, Japan and Korea.