Memory-IC backend service firms may cut back their capital expenditure budgets for 2014, due to low order visibility from DRAM clients, according to market observers.

　　Backend houses including Powertech Technology (PTI), Walton Advanced Engineering and ChipMOS Technologies have seen orders for DRAM remain slow indicating low order visibility for the first half of 2014, the observers said. The firms are expected to spend less on their offerings for DRAM products in 2014, acknowledging that growth in the overall DRAM market is set to decelerate.

　　The overall DRAM market consisting of standard DRAM, mobile DRAM and niche-market memory chips is forecast to grow by a modest 25-30% in 2014, the observers indicated.

　　In addition, with an aim to enhance its profitability, Micron is likely to utilize its increased negotiation power when dealing with packaging and testing service companies in 2014, the observers noted. Micron's previous acquisition of Elpida Memory has made it a key customer of PTI and Walton, the observers said.

　　In other news, PTI and Walton have both revealed a slowdown in demand for mobile DRAM chips.

　　PTI chairman DK Tsai said previously that mobile demand has decelerated in the fourth quarter of 2013, and companies will start to adjust inventory in the first quarter of 2014.

　　Nonetheless, despite weakness in mobile DRAM demand, PTI will enjoy impressive growth in its businesses for non-memory products including application processors and other logic chips requiring wafer-level packaging solutions, Tsai noted.

　　Walton revealed that its capacity utilization rates for mobile DRAM slipped to 80-85% in November, and expressed caution about its performance in the first quarter of 2014.