"And let me jump in here, we're not going to be moving capacity around on a high frequency basis. The changes we're making are over the long haul and if we look at the market going forward for NAND, there is just insatiable demand."
So, here's the irony of the whole memory thing: DRAM demand is soft due to the soft PC business, DRAM prices are up 130% in seven months. NAND pricing is only up about 30% in that time. Hynix is converting DRAM capacity to NAND, Samsung is building a NAND giga-fab in China. Micron said in the same conference call that they were converting a large Singapore DRAM fab to NAND. Speculation is that Micron will convert another million wafers per year at either Rexchip or Inotera from DRAM to NAND.
To wrap things up in this crazy business, NAND demand is driving the conversion of DRAM capacity to NAND capacity, thus driving the price up on DRAM. Even with the conversion activity and new Samsung capacity, the SSD part of the PC Industry is still about 11 million wafers short of providing SSDs for all the Intel CPU chips. That's about nine giga-fabs and $36 billion short.