You don't have to be a computer techno-whiz to feel the pinch of the memory-chip shortage.
Analysts say that the scarcity of memory chips might come back to haunt a broad base of electronics consumers - potentially hiking prices for everything from video cameras and fax machines to high-tech toaster ovens and burglar alarms."It could put products out of reach for some people," said Tim Bajarin, an executive vice president with Creative Strategies, a high-tech consultancy firm in Santa Clara, Calif.
The tiny DRAM - dynamic, random-access memory - chips are the lifeblood of consumer electronics.
Many videocassette recorders, stereos, microwaves and car dash boards operate from directions sent out of a microprocessor. The microprocessor has to run in tandem with a DRAM that stores information, like the time and channel of the soap opera you want your VCR to record.
The problem is that more "smart" electronic appliances and gadgets promise to raise demand for memory chips. At the same time, the DRAM industry sits on the verge of supply problems.
The 1988 memory chip drought was in part a result of demand exceeding supply. DRAMs bucked the trend of lower chip prices, jumping more than eight times. Computer makers like Apple Computer Inc. and Hewlett-Packard Co. charged customers for the extra cost with their own increased prices.
Improved supply has stabilized chip prices, but analysts said the same scenario might play itself out on a broader range of products because of lingering problems, including:
-Limited number of chipmaking plants that are already producing at capacity.
-Heavy reliance on production from Japanese competitors, which are the target of ongoing federal trade policies to curb unfair competition.
-Increased demand across a wide array of burgeoning high-tech electronics products.
-Production slow-downs when plants change operations to place emphasis on new types of chips.
"Nothing has changed - the exact conditions that caused this year's shortage are still there," said William Krist, vice president of international operations for the American Electronics Association in Washington, D.C.
Although memory chip demand is not expected to create a price crunch until at least late next year, early signs of higher price tags already are surfacing.
Analysts blame recent videocassette recorder price increases from Japanese giants such as Sony and Toshiba in part on the increased price of chips.
Memory requirements are expected to soar into the 1990s, as a variety of home and office products become loaded with high-tech capabilities.
Personal computers will lead the rush toward memory demands. Dataquest, a San Jose, Calif.,-based market research firm, said that average memory requirements will have increased from 256-kilobits in 1986 to one-megabit this year. By 1990, personal computers will use an average of three-to-four megabits of memory.
The new wave of high-definition televisions, which offer very detailed pictures, also will gobble up chip memory - reportedly more than 20-megabits.
Long considered a U.S.-dominated business, the DRAM market became controlled by Japanese conglomerates in the late 1970s. Japanese chipmakers grabbed most of the business by slashing chip prices far below cost in a controversial strategy called "dumping."
Today, Japanese companies own nearly 90 percent of the $5.6 billion memory chip market. Dataquest predicts increased memory demands for personal computers and smart appliances will push sales to $10.8 billion by the end of 1992.
With only three surviving U.S.-based memory chipmakers, analysts say the American electronics industry could be at a competitive disadvantage because companies are forced to buy chips from the same Japanese companies they battle on retailers' shelves.
"It's strategically a very precarious position to be in when you're relying on a competitor to supply your key components," said Bart Ladd, an industry analyst with Dataquest.
Ladd believes the worst is behind memory chip customers and that chipmaking plants will be expanded to meet higher demands. He added that Japanese companies will be the ones to increase production.
But Japanese dominance might force price-conscious consumers to buy more Asian products, which could sell chips to themselves at cost and at significant mark-ups to U.S. buyers - thereby raising the price of a finished product, said Rajiv Chaudri, an analyst with Goldman, Sachs & Co.
Warned Chaudri: "This is an issue that's not going to go away."