SanDisk 2010 Annual Report Download - page 134

•Wafers and Components. In addition to the finished products listed above, from time-to-time, we also
sell raw memory wafers and memory components in packaged format.
Our Primary End Markets
Our products are sold to three primary large end markets:
•Mobile Phones. We provide embedded and removable storage for mobile phones. We are a leading
supplier of the microSD and Memory Stick Micro™ product lines of removable storage cards used in
mobile phones. Multimedia features in mobile phones, such as camera functionality, audio/MP3,
games, video and internet access, have been gaining in popularity. In addition, there has been
increasing usage of native and downloaded applications in mobile phones. The usage of multimedia
features and applications are driving demand for additional NAND flash memory storage in mobile
phones.
•Consumer. We provide flash storage products to multiple consumer markets, including imaging,
gaming, audio/video and GPS. Flash storage cards are used as the film for all major brands of digital
cameras. Our cards are also used to store video in solid-state digital camcorders and to store digital data
in many other devices, such as maps in GPS devices. In addition, portable game devices now include
advanced features that require high capacity memory storage cards and we provide SD cards and
Memory Stick PRO Duo™ cards that are all specifically packaged for the gaming market. We also sell
a line of digital media players with both embedded and removable memory under our Sansa brand with
varying combinations of audio and video capabilities, and we sell slotMusic cards and slotRadio which
are preloaded with music content and can be used in a wide variety of mobile phones and digital media
players. Primary card formats for consumer devices include CF, SD and Memory Stick®.
•Computing. We provide multiple flash storage devices and solutions for the computing market. USB
flash drives allow consumers to store computer files, pictures and music on keychain-sized devices and
then quickly and easily transfer these files between laptops, notebooks, desktops and other devices that
incorporate a USB connection. USB flash drives are easy to use, have replaced floppy disks and other
types of external storage media, and are evolving into intelligent storage devices. In addition, we sell
other embedded and semi-embedded SSDs, which we call SanDisk®pSSD™ and SanDisk®integrated
solid state drives (iSSD), for the computing market. We continue to develop new releases of our SSDs
for the mainstream notebook and desktop computer markets and we believe that SSDs will become a
major application for NAND flash memory over the next several years as they are increasingly likely to
replace hard disk drives in a variety of computing solutions.
Our Sales Channels
Our products are delivered to end-users through worldwide retail storefronts and also by bundling data
storage cards with host products or by embedding our data storage products in host devices sold by our OEM
customers.
Our sales are made through the following channels:
•OEM. We sell our products through OEM customers who bundle or embed our products in a large
variety of digital consumer devices, including mobile phones, digital cameras, personal computers, or
PCs, GPS devices and gaming products. We also sell products to OEM customers that offer the
products under their own brand name in retail channels. We sell directly to OEMs and through
distributors. We support our OEM customers through our direct sales representatives as well as through
independent manufacturers’ representatives.
•Retail. We sell SanDisk branded products directly or through distributors to consumer electronics
stores, office superstores, photo retailers, mobile phone stores, mass merchants, catalog and mail order
companies, internet and e-commerce retailers, drug stores, supermarkets and convenience stores.
6