Recently, there has been news in the industry that manufacturers like Apple and OPPO are considering using QLC NAND flash storage in their 1TB large-capacity smartphone models, instead of the previously mainstream TLC NAND flash storage.
As a newly introduced product, QLC NAND flash storage sparked a wave of heated discussion in 2018, but it did not quickly dominate the market and become mainstream. Currently, it is only used in consumer electronic products such as PC OEMs, consumer-grade solid-state drives, and USB drives, and has not entered into products like smartphones and data centers. With this evaluation of new products by Apple and OPPO, does QLC NAND flash storage have a chance to enter the mainstream market? What impact will the further development of QLC NAND have on the flash storage industry?
01
2024: The Potential Inaugural Year of QLC NAND in the Mainstream Market
According to the latest news from the supply chain, Apple may adjust the storage strategy for its next generation of iPhones. The current models, such as the iPhone 15, use the TLC NAND flash storage solution. Apple plans to further expand the storage capacity in subsequent models, reaching or exceeding 1TB. It is reported that Apple is assessing the feasibility of using QLC NAND flash storage in these models. Additionally, there is news that Chinese smartphone brands like OPPO are also conducting product certifications for QLC NAND flash storage.
QLC refers to a type of NAND flash storage technology where each cell can store 4 bits of information (4 bits/cell). Compared to SLC (1bit/cell), MLC (2bit/cell), and TLC (3bit/cell), QLC has obvious advantages in storage density and cost. Data shows that a single die of 96-layer 3D QLC NAND can achieve about 2TB. This means that QLC requires fewer cells for the same storage capacity, significantly reducing production costs. However, QLC flash storage also has some clear disadvantages, such as a lower erase life, with QLC NAND only able to reach 150 cycles compared to 500-1000 cycles for TLC. Additionally, there are issues with lower reliability and slower writing speeds.
In 2018, with the transition of NAND flash storage from planar to three-dimensional, QLC NAND products were introduced and caused a surge of interest. However, QLC NAND flash storage currently only holds a portion of the market share in consumer electronic products like PC OEMs, consumer-grade solid-state drives, and USB drives. This market segment is characterized by a higher tolerance for data storage errors and greater price sensitivity, hence the preference for larger capacity, lower-priced QLC NAND. However QLC NAND has not yet entered mainstream storage markets such as smartphones and data centers.
So, does this evaluation of new products by Apple and OPPO have the chance to bring QLC NAND flash storage into the mainstream market? Qian Yu, a senior analyst at JIWEI Consulting, believes that Apple has certain motivations for adopting QLC NAND flash storage. On one hand, switching from TLC to QLC could reduce costs by about 20% to 30%. As the storage capacity of phones continues to expand, the cost advantage of QLC NAND will become more apparent. On the other hand, the price of NAND flash storage has begun to rebound in this storage cycle, and the future price of memory is expected to rise. Apple’s large volume of memory purchases means that even if the price per chip decreases, the overall procurement cost can be significantly reduced. OPPO’s procurement logic is roughly similar.
Regarding issues like the erase life and writing speed of QLC NAND, the overall reliability and lifespan indicators have gradually decreased from SLC, MLC, TLC, and QLC, and even PLC and HLC that may be introduced in the future. This is determined by the inherent nature of NAND flash storage architecture. However, this does not mean that QLC NAND flash storage is unsuitable for widespread use. From flash hardware, controllers, and algorithms, to software optimization, all these aspects have a significant impact on the final user experience. If Apple decides to implement this plan, with its design capabilities, it is believed that the shortcomings of QLC NAND can be minimized.
Kang Yi, Vice President of Guoke Micro, also predicts that QLC NAND will gradually become mainstream in the market, and this year may even be the inaugural year for QLC NAND to enter mainstream markets such as smartphones and data centers. The main reason is the increase in user demand for high-capacity storage and cost-effectiveness. Additionally, from the upstream industry, there are efforts to improve the performance and yield of QLC NAND in products.
02
The Ongoing Replacement of HDD and TLC
Several major flash memory manufacturers have launched QLC NAND products. During the 2018 boom, Samsung, Micron, Toshiba, and Western Digital all released 96-layer QLC NAND. Yangtze Memory Technologies Co., Ltd. (YMTC) introduced the industry’s first 128-layer QLC NAND flash in 2020. In 2021, Samsung significantly improved the write speed in its 176-layer QLC NAND flash, reaching 320MB/s. This substantially surpassed the write speed of mechanical hard drives (HDD), laying the foundation for QLC NAND flash to replace HDDs. In 2022, SK Hynix showcased a 192-layer QLC NAND flash at the Tech Field Day technology summit. Last year, Samsung even claimed that it was developing QLC NAND solid-state drives (SSDs) with capacities exceeding 1000TB, or petabyte-level.
The main reasons for the storage giants’ enthusiasm for QLC NAND flash are: First, the global flash memory capacity has increased, leading to a sufficient supply. The prices of flash memory and solid-state drives have continued to fall, intensifying market competition. Manufacturers must reduce costs to enhance their competitiveness in the flash and SSD markets. Second, in recent years, there has been an increase in global investment in semiconductor technology research and manufacturing. Continuously introducing new technologies and products is essential to consolidate industry positions.
With the push from flash memory manufacturers and the gradual maturation of technology, the application range and market share of QLC NAND flash are expected to expand further in the coming years. Data shows that the shipment volume of QLC NAND flash is expected to account for 19% to 20% of the total NAND shipments in the first half of 2024.
TrendForce analyst Ao Guofeng believes: “The performance of QLC NAND is now sufficient for consumer-grade products, especially in the consumer-grade SSD field. In the future, QLC’s shipment proportion has the opportunity to grow to 50%.” This is also reflected in market feedback. Consumer-grade SSDs are divided into high-end and mid-low-end products based on performance levels. Initially, due to the lower performance of QLC NAND granules, they were generally positioned in mid-low-end consumer-grade SSD products, priced lower than TLC SSDs, and followed an extreme cost-performance strategy, achieving good sales volumes. Now, QLC NAND granules, in terms of interface speed and read/write performance in SLC block mode, are not inferior to TLC NAND. For both retail and channel SSD users, as well as PC OEM users, QLC SSDs will be a good choice.
Regarding enterprise-level SSD applications, Ao Guofeng believes that QLC can indeed replace some mechanical hard drives in cloud services, but due to the still significant price difference between QLC enterprise drives and mechanical hard drives, they currently cannot completely replace mechanical hard drives in servers.
Qian Yu believes that looking to the future, if Apple adopts QLC NAND, it will undoubtedly serve as a strong example, leading more manufacturers to follow suit. QLC NAND is expected to be first applied in smartphones with large storage capacities such as 1TB and 2TB. For phones with 512GB and 256GB capacities, manufacturers will still likely use TLC NAND. As for data centers, it depends on the specific application scenario. For the storage of cold data, QLC NAND has the potential to be a replacement. However, servers storing hot data will probably not opt for QLC NAND solutions.
03
Chinese Enterprises: Market Changes Signify Opportunities
As the application of QLC NAND gradually expands, the emergence of new products and technologies will inevitably impact the existing market landscape. This also presents a rare development opportunity for domestic (Chinese) enterprises.
Ao Guofeng points out that Chinese enterprises have started mass-producing QLC NAND. As the future shipments of QLC in smartphones and laptops increase, domestic controller IC and module factories will need to improve their main control technologies and expand shipment volumes to meet the domestic market demand. Kang Yi also advises related enterprises to timely upgrade their products and industrial chains.
Moreover, the production of QLC NAND flash requires advanced processes and equipment, providing Chinese enterprises with a new field for development. By investing in the research and development and production of QLC NAND flash, Chinese enterprises can not only meet domestic market demands but also venture into the international market, competing with global leading storage manufacturers.
However, some experts also point out that QLC NAND flash technology is still in its early stages of development and faces some technical and market challenges. For instance, how to improve the lifespan and performance of QLC and how to further reduce production costs are issues that need to be addressed. Therefore, when entering this field, Chinese enterprises need to fully consider their own technical strength and market positioning and formulate appropriate development strategies.
Overall, the application of QLC NAND flash storage brings tremendous development opportunities for Chinese enterprises. By actively participating in the research, development, and application of this technology, Chinese enterprises are expected to occupy a place in the future storage market, achieving both technological and economic breakthroughs.
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