While this is a relatively quick week for the semiconductor industry and the memory market, we can begin to look forward to 2015. One potential political and civil hot button could have long-term effects on the memory market. And that’s police body cameras. The Obama administration has asked for congressional approval for a program that would offer $75 million over three years to match state funding for the cameras by 50 percent, helping to pay for more than 50,000 cameras. (Source: http://www.nbcnews.com/politics/first-read/obama-requests-263-million-police-body-cameras-training-n259161)
The Los Angeles Police Department was the first in the nation to approve its entire force of 7,000 for the use of body cameras. Initially, 800 units will be purchased in January. The remainder of the force will be equipped throughout the year. Currently, there are more than 900,000 sworn officers in the United States.
There are a few core manufacturers of police body cameras. While no technical teardowns are currently available, visiting manufacturers’ websites and pulling specs show the wide range of memory device densities used in these cameras. Internal storage ranges from 16GB to 32GB. Some models offer removable microSD cards that come with an 8GB standard, and options for a 32GB.
Numerous other components go into these cameras including GPS sensors, LCDs and CMOS sensors to name just a few higher profile items. ASPs for these cameras range from $300 for standard models to almost $1,000 for advanced models with long-term support features and monitoring. Main internal memory will be dominated by NAND flash but I can see applications that could utilize Mobile LP DDR, depending on price points and contract pricing options.
Internal memory will need to test to automotive standards (-40° to +85°C) as most of these cameras will be used in rugged conditions. NAND and DRAM manufacturers will need to start to shift production and testing to higher-reliability product. I can foresee commercial-grade inventory levels shrinking and potential price increases in industrial- and automotive-grade parts. Depending on the order run rates, lead times on NAND could stretch to levels that parallel current DDR lead times. I am keeping a closer eye on the NAND market and if Congress approves funding for the police body cameras I expect to see a surge in NAND activity in Q1 2015 as law enforcement agencies place orders and camera manufacturers ramp production.
So how will this affect the memory market? Demand for these cameras will create a new industry profile for memory well past this time next year. More pressure will be put on an already volatile market place. Lead times will need to be met in order for the public, as well as the government to roll out these cameras in the quickest time frame possible.
It will be up to many of the memory component manufacturers to swiftly shift capacities. However, demand can be calculated as this is an isolated scenario where one industry is creating the need. Unlike past surges in activity, we have actual measurable numbers to tally where possible production numbers fall.
Joe Stern is the memory product manager at America II Electronics. With more than 15 years’ experience at the company, Joe has spent the majority of his time on the purchasing and supply chain side of the business. Joe started his career at America II in 1999 in sales. He then transitioned to the purchasing team in 2001 as the memory commodity buyer and was soon promoted to senior memory buyer. During his time on the purchasing team, Joe became a subject matter expert in the memory field, leading new hire and product training, analyzing market conditions, and identifying opportunities to increase profitability all while continuing to support customer supply chains. In 2013, Joe was promoted to the product management team. In his current role as memory product manager, Joe works closely with his global sourcing team and is responsible for inventory position, internal marketing and promotion of key component manufacturers for global sales and purchasing.