Contract prices for DDR4 memory have recently experienced a dramatic fall, due mainly to Samsung Electronics' price cuts aimed at increasing market share, according to industry sources.

Meanwhile, system OEM vendors including data center and server companies have started to source DDR4 products from memory module makers for cost reasons, said the sources. Original DRAM vendors are also being requested to lower their quotes dragging down the overall contract prices further, the sources noted.

DDR4 prices have been brought down significantly to come closer to DDR3 prices, though DDR4 just replaced DDR3 as the mainstream memory technology, the sources indicated.

While producing DDR4 chips is making less profits, some DRAM makers consider slowing down their technology transitions to 20nm process in order to reduce their capex, the sources said.

In addition, due to the poor yield rates some DRAM makers suffered previously at the beginning of their transitions to 20nm, some downgrade chips have been sold at a discount which could be a problem for the industry, the sources pointed out.

Intel's delay of its desktop Skylake processors is negatively affecting demand for PC DRAM, while demand for high-margin server DRAMs is decelerating due to disappointing server sales, the sources found.