Worldwide, businesses are experiencing vast IT supply chain shortages for a variety of memory components, including DRAM and NAND. While April has seen a myriad of emails and customer communications hit inboxes on what delays can be expected, Procurri steps up – to fill the gap and deliver the goods.
What’s causing the current memory component supply chain shortage?
For a few years post-Covid, the IT channel struggled with the chip shortage as a result of delayed manufacture and increasing demand. While this seems to have now eased over time, instead, organizations are now finding it difficult to get hold of the memory components they require – and there are several reasons behind such shortages.
Increasing demand from AI
The adoption of AI such as ChatGPT into mainstream capabilities has exploded the demand for AI data centers, with a vast amount of HBM (High-Bandwidth Memory) required. As the ‘tech of the future’, chipmakers are prioritising the supply of their AI customers over traditional consumers, which redirected the production capacity away from PCs, servers and storage.
Limited manufacturing capabilities
The global picture of memory manufacturing is currently somewhat limited (albeit with some major players involved), and they’re cautious in unnecessary expansion. Currently, Samsung, Micron and SK Hynix have the monopoly on the market, and are somewhat averse to scaling up their capabilities to avoid a potential boom-and-bust cycle. However, this does mean that as AI spikes demand, the supply can’t easily ramp up to meet it – leaving organizations high and dry.
Structural shortage
Realistically, it should be noted that this isn’t a traditional short-term supply disruption: it’s a long-term imbalance in supply and demand. Lead times are growing, with prices rising sharply, and reports of suppliers keeping customers waiting for over nine and even ten months. This does mean that this supply chain shortage could last well into 2027.
Price volatility
To add further to the chaos, component costs remain unstable. Vendors are shortening their price protection windows to protect themselves from losing a decent margin, and it’s even become acceptable to the market for suppliers to reserve the right to increase prices after orders have been placed and confirmed. This price volatility leads to mass uncertainty for partners and end customers; which is doing absolutely nothing for organizations’ trust in the market.
What are DRAM and NAND, and how do they work together?
The issue with the current supply chain shortage in memory components is that the two most affected parts are invaluable in IT infrastructure, despite being so different in their function.
DRAM (Dynamic Random Access Memory)
DRAM is a type of temporary and high-speed memory used by systems while they’re actively working. It holds everything a user needs at a given time. DRAM, by its nature, is:
- Very fast
- Volatile (its data disappears when a system is powered off)
- Used only for active tasks and applications.
DRAM is used in AI workloads, but also appears on all servers running applications and databases, and all laptop and desktops (as system RAM). The heavier the workload, the more DRAM is used.
NAND (NAND Flash Memory)
NAND is a permanent storage memory that keeps data even when powered off. It stores everything long-term. DRAM, by its nature, is:
- Slower than DRAM, but fast compared to older hard drives
- Non-volatile (it will keep its data without power)
- Used for storage.
NAND can be found in data center storage systems, smartphones and tablets, SSDs, and USB drives.
Without DRAM, systems can’t run efficiently and without NAND, systems can’t store anything. Both are produced by a small number of manufacturers, and both are being consumed rapidly by AI demand.
What are the knock-on effects of memory shortages?
With workloads as they are now, memory makes up a larger share of system cost than it does before. This means that when shortages occur, the supply impact ripples into storage systems, servers, and laptops – with entire hardware shipments being delayed just for memory components.
Even in the event that a supplier is able to provide every other component, it can’t be shipped without the memory because it simply won’t function.
What’s the solution to the IT memory shortage?
Of course, unless something dramatic happens to the rapid development and adoption of AI, or to the manufacturing process of hardware, it is unlikely that demand for memory components will lessen. Indeed, the current supply chain shortage is very unlikely to be temporary, as it marks the beginning of a fundamental shift in the market. While many vendors are adapting as they can, some have already changed the way their supply models work to operate within it – and not necessarily to the benefit of their customers.
‘Communication’ certainly appears to be the buzzword that vendors are using around the whole situation, but customers don’t need communication… they need certainty!
Supply certainty can be guaranteed by Procurri. Here’s what we can offer over and above other vendors:
Guaranteed Availability
Procurri has the world’s largest stockholding of hardware spread globally in distribution warehouses across three continents. We stock all major OEM hardware spanning server, storage and networking equipment, as well as new, pre-used, recycled and refurbished. Procurri even has access to legacy and hard-to-find parts – so no matter how complex your configuration, you’ll be guaranteed supply.
Price Stability
It is fast becoming the norm for vendors to reserve the right to increase prices even after an order has been confirmed; despite the then delay in physical supply. Procurri do not inflate or change pricing once an order has been made, so organizations can enjoy the standard stability they deserve. We also strive to offer transparent and accurate quotations, free of hidden charges or fees.
Speed of Delivery
The sheer amount of hardware in Procurri’s stockholding means that no matter where in the world you need to fulfil hardware requirements, we can supply them rapidly with short lead times; and even with pre-configured solutions if needed.
At Procurri, we don’t just communicate delays. We remove them.
Get in touch with the team today to learn more about our worldwide speedy hardware supply.
