Also commits to mass production of new SED technology
Japanese electronics giant Toshiba plans to invest more than $9bn to build new Flash memory manufacturing plants over the next three years.
The Nand Flash memory that the factories will make is commonly used in consumer electronics products like digital media players, and is expected eventually to move into some of the roles currently occupied by hard disk drives.
Toshiba's investment is part of an $18bn spending package outlined by company executives at a Tokyo briefing yesterday.
Among other initiatives, Toshiba will go ahead with mass production of its new high-contrast Surface-conduction Electron-emitter Display (SED) technology co-developed with Canon.
Toshiba hopes that the investment will boost its total worldwide sales from $58bn last year to more than $70bn in fiscal 2009, with operating profits of $3.52bn.
Analysts were generally positive about the plans, but expressed doubts that the company's profit margin targets were easily achievable.
Toshiba's new focus on Flash memory will bring its total number of Flash production plants up to five.
This will help it regain lost market share, according to analysts from Nomura Securities, and compete more strongly with Samsung, the dominant player in the Flash market.
The global value of the Nand Flash memory market is expected to double from about $10bn last year to more than $20bn in 2010.
"We regard this [Flash memory investment] as positive news in that it should allow Toshiba to iron out shortfalls in engineering resources and up the pace of capacity investment," said Nomura analyst Masaya Yamasaki in a research briefing.
Toshiba is ready for a price war as more and more Flash plants come online this year and the market moves to higher capacity chips.
"Although Nand Flash memory prices have decreased since the turn of the year, especially in the spot market, the shift did not exceed our estimated range for the fourth quarter," a Toshiba spokesman said during a press conference last month.
"We anticipate full-year price erosion of as much as 30 to 40 per cent in fiscal 2006."
Toshiba is also due to open a second production line in Japan for SED screens in 2008 at a cost of $1.63bn, in addition to a pilot mass production line which is already running. Products are set to hit the market in force next year.
"We think the project still carries substantial risks," said Nomura's Yamasaki. "Such a vast investment is likely to trigger concerns over potential losses for the first two years or so."
SED screens use a miniature cathode ray tube for every pixel. This allows the displays to be as thin as flat-screen LCD and plasma screens, while retaining the brightness, colour and high refresh rates of traditional CRTs.
Toshiba hopes to be able to build SED screens in high volume and at low cost by using a manufacturing technique derived from inkjet printing technology developed by Canon.
Japanese electronics giant Toshiba plans to invest more than $9bn to build new Flash memory manufacturing plants over the next three years.
The Nand Flash memory that the factories will make is commonly used in consumer electronics products like digital media players, and is expected eventually to move into some of the roles currently occupied by hard disk drives.
Toshiba's investment is part of an $18bn spending package outlined by company executives at a Tokyo briefing yesterday.
Among other initiatives, Toshiba will go ahead with mass production of its new high-contrast Surface-conduction Electron-emitter Display (SED) technology co-developed with Canon.
Toshiba hopes that the investment will boost its total worldwide sales from $58bn last year to more than $70bn in fiscal 2009, with operating profits of $3.52bn.
Analysts were generally positive about the plans, but expressed doubts that the company's profit margin targets were easily achievable.
Toshiba's new focus on Flash memory will bring its total number of Flash production plants up to five.
This will help it regain lost market share, according to analysts from Nomura Securities, and compete more strongly with Samsung, the dominant player in the Flash market.
The global value of the Nand Flash memory market is expected to double from about $10bn last year to more than $20bn in 2010.
"We regard this [Flash memory investment] as positive news in that it should allow Toshiba to iron out shortfalls in engineering resources and up the pace of capacity investment," said Nomura analyst Masaya Yamasaki in a research briefing.
Toshiba is ready for a price war as more and more Flash plants come online this year and the market moves to higher capacity chips.
"Although Nand Flash memory prices have decreased since the turn of the year, especially in the spot market, the shift did not exceed our estimated range for the fourth quarter," a Toshiba spokesman said during a press conference last month.
"We anticipate full-year price erosion of as much as 30 to 40 per cent in fiscal 2006."
Toshiba is also due to open a second production line in Japan for SED screens in 2008 at a cost of $1.63bn, in addition to a pilot mass production line which is already running. Products are set to hit the market in force next year.
"We think the project still carries substantial risks," said Nomura's Yamasaki. "Such a vast investment is likely to trigger concerns over potential losses for the first two years or so."
SED screens use a miniature cathode ray tube for every pixel. This allows the displays to be as thin as flat-screen LCD and plasma screens, while retaining the brightness, colour and high refresh rates of traditional CRTs.
Toshiba hopes to be able to build SED screens in high volume and at low cost by using a manufacturing technique derived from inkjet printing technology developed by Canon.
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