With many people in the US restricted to their homes and working remotely, as well as watching streaming TV channels rather than socializing outside of their families, internet access has been increasing. On March 19 OpenVault said they had data indicating that business hours broadband consumption has risen by more than 41% and that March is on track to outpace the previous monthly record. OpenVault says that its research is based on the actual usage of more than one million broadband subscribers throughout the United States.
According to the press release, “One week after the CDC declaration of the virus as a pandemic, OpenVault data confirms the following:
- Subscribers’ average usage during the 9 am-to-5 pm daypart has risen to 6.3 GB, 41.4% higher than the January figure of 4.4 GB.
- During the same period, peak hours (6 pm–11 pm) usage has risen 17.2% from 5.0 GB per subscriber in January to 5.87 GB in March.
- Overall daily usage has grown from 12.19 GB to 15.46 GB, an increase of 26.8%.
Based on the current rate of growth, OpenVault projects that consumption for March will reach nearly 400 GB per subscriber, an increase of almost 11% over the previous monthly record of 361 GB, established in January of this year. In addition, OpenVault projects a new coronavirus-influenced run rate of 460 GB per subscriber per month going forward.”
Greater use of internet connections also translates to greater utilization of private and public cloud services (big connected data centers). There are signs that this is leading to growth in data center infrastructure to meet this demand. Although the electronics supply chain in China and Korea are starting to recover, with the decline in COVID-19 cases in those countries, there are signs that there are shortages and higher prices for memory and storage products to service the increase in data center demand.
According to DRAMeXchange (part of Trendforce), Q2 server DRAM ASPs will rise 40% Q/Q and SSD prices will rise 15% Q/Q as a result of increasing demand for cloud services to support remote working as shown in the table below. DRAMeXchange says that the supply of server DRAM is now tight and inventory levels at both suppliers and customers are low.
Trendforce enterprise projections
Image from TrendForce Release
Although DigiTimes is very bullish on the outlook for DRAM prices thanks to the COVID-19 pandemic, Jim Handy of Objective Analysis has the opposite sentiment. “Since capital spending in 2018 was unusually high, there’s every reason for the DRAM market to drop from its current rising prices back into decline, with prices eventually falling to cost as they always do during an oversupply. Now that COVID-19 has become a pandemic there’s every reason for this to occur sooner than would have happened without the pandemic. Lagging demand in the larger part of the DRAM market (PCs and cell phones) and supply chain issues should cause demand to contract, leading to a sudden sharp consumption drop.” More about this is spelled out in Handy’s blog The Memory Guy.
Smart phones and PC’s drive most of the DRAM and flash market. These products are still in decline. Thus, the total memory market may continue a cost per GB decline even though there may be shortages of higher performance specialized products for the enterprise and data center markets.