'Sapphire Rapids' Emerges... Next-Generation DRAM Market Expands in Earnest (Comprehensive)

New Intel Server CPU Launch
Will It Boost the DDR5 DRAM Market?
"Immediate Impact Expected," Experts Say

[Asia Economy Reporter Kim Pyeonghwa] The Double Data Rate (DDR)5 DRAM market, regarded as a new high value-added growth engine in the memory semiconductor industry, is poised for full-scale expansion. Intel launched its new server central processing unit (CPU) product, 'Sapphire Rapids,' on the 11th, which is expected to accelerate the DDR5 DRAM market. Industry experts predict that the market expansion effect following the release of Sapphire Rapids could appear immediately.

The First Intel Server CPU Equipped with DDR5

Intel Korea held a press briefing on the morning of the 11th at the Federation of Korean Industries building in Yeouido, Seoul, introducing the '4th Generation Intel Xeon Scalable Processor (codename: Sapphire Rapids).' This briefing was part of a domestic product presentation following Intel's official announcement of Sapphire Rapids on the 10th (local time).

Na Seung-joo, Executive Director of Intel Korea, is introducing Sapphire Rapids. /
Photo by Kim Pyeong-hwa

Sapphire Rapids is the 4th generation model of Intel's server CPU brand, the Xeon Scalable Processor. It is a new product released about two years after the 3rd generation model entered the market in 2021. The product appeared in the market one year later than originally planned due to efforts to improve product quality.

Sapphire Rapids boasts enhanced power efficiency, with Intel describing it as the 'most sustainable data center processor.' To improve performance, it is equipped with 12 built-in accelerators, the most among CPUs. This supports an average of 2.9 times higher watt-per-performance compared to its predecessor for target workload processing.

For memory enhancement, it is the first Intel server CPU to support DDR5. DDR5 is the latest standard of DRAM memory semiconductors. It is twice as fast as the previous generation DDR4 and offers 30% better power efficiency. Sapphire Rapids, by supporting DDR5, has expanded memory bandwidth by 1.5 times compared to DDR4.

Will Sapphire Rapids Be a Catalyst for the DDR5 Market?

Sapphire Rapids has attracted particular attention from the memory semiconductor industry due to its DDR5 support. When various companies with data centers and hyperscalers (global data center operators) replace servers to use Sapphire Rapids, the use of DDR5-based server DRAM is inevitably expected to increase.

The memory industry has already completed the development of DDR5-based server DRAM to meet this demand. Samsung Electronics unveiled a 12nm-class 16-gigabit (Gb) DDR5 DRAM last month. SK Hynix also revealed a server DDR5 DRAM sample with 80% faster speed than existing products in the same month.

Intel Sapphire Rapids / Photo by Intel

DDR5 DRAM is a high value-added product with 30% higher profitability compared to DDR4. The memory industry views the launch of Sapphire Rapids as a key opportunity to expand the profitable DDR5 DRAM market in earnest. It is seen as a chance to overcome the semiconductor industry's downturn.

There are even forecasts that the DDR5 market could be affected this year. A memory industry official said, "Since there is accumulated demand waiting for server replacement, the effect of the launch is expected to appear immediately," adding, "noticeable changes are expected from the second half of the year at the latest."

Intel also anticipates significant influence given its dominant market share in the server CPU market. Na Seungju, Managing Director of Intel Korea, explained, "As the 4th generation product (Sapphire Rapids) ranks up, the DDR5 market is expected to grow."

The Korea Eximbank Institute for Global Economy published a report this month forecasting that servers equipped with Sapphire Rapids will be launched in earnest from the second quarter.

Omdia: "DDR5 Share to Surpass DDR4 Next Year"

Economic uncertainty this year is a concern for the expansion of the DDR5 market. Data center investments may not proceed as expected in the market. However, from a long-term perspective, demand is still expected to remain high.

Kim Yangpaeng, a senior researcher at the Korea Institute for Industrial Economics & Trade, said, "It usually takes six months to a year for a product to spread widely, and DDR4 took two to three years to reach a 60% market share," adding, "While it could take as little as six months in the short term, the situation needs to be monitored given the weak conditions in other demand industries and the global economy."

Market research firm Omdia forecasts that DDR5 will account for 20.1% of total DRAM this year. Next year, the share is expected to increase to 37.3%, surpassing DDR4's 17.0%. Omdia also predicts that by 2025, DDR5's share will grow to 40.5%, approaching the majority.