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Lexar Sees Strength In Memory Markets Old and New

New York — Lexar is a taking a “Proctor & Gamble” approach to the flash-memory market, using its own brand and those of partners such as Disney and Kodak to stay afloat in a fiercely competitive market, said president Mark Adams.

The company, which was

acquired by Micron

in 2006, will focus on growing new product categories aside from its core memory card business, such as solid state drives (SSD) for notebook computers and multimedia devices due late in 2008, Adams said. The firm is also enjoying success in an old format — CompactFlash.

“It’s not dead yet — we’re still investing in it,” Adams said. CF has been bolstered by speed and capacity increases driven by the surging digital SLR market.

As for SSD, that market is still ramping up, Adams said. “Right now prices for a 32GB drive are too expensive for a peripheral. You need to be at 25 percent of the host device, right around $149 to $199.” And, he added, “the technology is still ahead of customer awareness.”

After extending its brand partnership with Kodak for entry-level flash cards for five years, the firm linked with Disney to offer memory cards with preloaded content for the teen market. Turning flash-memory cards into a content delivery vehicle has been difficult, Adams said, because of all the moving pieces that have to align to make it work. That said, “Prices are coming down so it’s making more sense.”

Transforming flash-memory cards into software platforms, such as USB smart drives, has also been difficult, Adams observed.

The company is reassessing its PowerToGo USB smart drive platform — a competitor to the SanDisk-backed U3 drive (which will also evolve thanks to a new partnership with Microsoft). “Neither us nor U3 has been really successful,” Adams said. “Consumers just don’t get” the concept of smart drives, Adams said. “The software development for the drives needs to improve and the platform needs to be more open.”