The company had initially predicted that flash memory prices would drop by around 27 per cent between the fourth quarter of 2007 and now. It seems the actual figure was closer to a 53 per cent drop.
The finger of blame has been pointed at overcapacity problems and, somewhat surprisingly, a slowing in consumer demand.
Along with its competitors, Intel is now looking at aggressively ramping up production of large-capacity flash drives that are appearing in growing numbers of notebook PCs. At present these are significantly more expensive than hard drives of similar capacity, but as flash prices continue to plummet, this price gap is likely to quickly close.
The latest evidence of this comes from Samsung Electronics which is likely to be shipping massive 256-gigabyte solid state drives (SSDs) by next year - as large as the largest commonly available notebook hard drives.
The company's 64GB SSDs are already being used by Lenovo in its new X300 notebook PCs in place of a hard drive. They are also available as an option on Apple's new MacBook Air. Samsung is planning to make 128GB versions of the drives available to data hungry users by the middle of this year.
Flash drives have significant benefits for notebook users. They are lighter and consume less power. They also offer faster data access speeds and are robust enough to cope with knocks and drops when out on the road.