Is the DRAM market on a way to recovery?

Implications: The DRAM market is in a middle of a major down turn, over capacity and price decline plaguing the industry for the last year. Samsung exec for investor relations claims that toward second part of next year we will see price firming. The question is it really going to happen within that time frame.

Analysis:

The DRAM market is a commodity market and like all other commodities it is cyclical and depends on among other things on global economy. The demand for DRAM has constantly going up as new products that need DRAM are introduce to the market. So far so good, however the market could be flooded by over supply (Fab capacity) since most of the DRAM suppliers are trying to grab market share when prices are high and they are falling into the trap with their Fabs running when prices are falling.
During the last 3 years there were many 300mm Fabs that started making DRAM as well as more companies are trying to get more market share (Samsung, Hynix, Elpida, PoweChip, Promos, Quimonda, Micron) process that ending in huge price erosion.
Luckily one new parameter that affected this cycle is the growing demand for NAND Flash that offset some of the problems with DRAM pricing. Some of the companies (Samsung, Hynix) were shifting production back and forth between DRAM and NAND.
However even that didn't help and the traditional cycle is now in a full swing, while at the same time new production is still coming on line.
Samsung claims that the down turn will be over late 2008, eventually it will happened, though I think more likely by early 2009.

One wild card that is important to consider is the world economy that might getting into recession...in that case all bets are off and it might take one more year after 2008...