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The study from iSuppli shows that the smartphone market is expanding much faster than the overall handset segment. In 2013, smartphones will account for 26.4 percent of total cell phone shipments, twice as much over the 13.1 percent in 2008. Following the surge in sales of smartphones, the demand for NAND flash memory is set to boom as well, and iSuppli analyst Michael Wang believes this growth could be attributed to Apple’s iPhone.

"NAND flash makers can thank Apple Inc. for starting this trend, with its iPhone models injecting new life into the memory market," Yang commented.

Ever since the launch of the iPhone base model, Apple has been enjoying great success in the smartphone market, putting other handset makers on high alert. To compete against iPhone, they joined the battle by introducing a new generation of "iPhone killers", including the RIM’s BlackBerry Storm, the Palm Pre, and the Android-powered T-Mobile G1, which further drive the sales of smartphones and thus, increase the demand for NAND chips.

Along with spurring the growth of smartphone market, Apple is also continuously increasing the amount of NAND in the iPhone lineup, which set an example for other manufacturers to follow. While the original iPhone comes with only 4GB of NAND, the latest iPhone 3GS is upgraded to 16GB and 32GB. Although the Storm, the Pre and the G1 all with 8GB storage may not match iPhone in terms of flash memory capacity, some handset makers have already caught up with Apple: the newly unveiled Nokia N97 boasts 32GB of NAND flash memory. iSuppli said NAND densities in smartphone would continue to increase, as the average amount of NAND flash shipped worldwide is expected to rise to 5.8GB per handset in 2013, up from less than 1GB last year.

"Soaring sales of smartphones, combined with the increasing density of NAND flash in each handset, is causing sales of the memory in this area to boom," said Wang. It is estimated that global revenue from sales of NAND chips for cell phones would reach $932.5 million in 2013, compared to $166.5 million in 2008.