NAND technology drives increasing USB flash drive capacities

The evolution of NAND flash memory technology has driven a massive increase in USB flash drive capacities while making low-capacity models economically unviable for the consumer market. Early in the 2000s, 1GB drives were considered high-capacity, but advancements in making memory cells smaller, storing multiple bits per cell, and utilizing 3D NAND vertical stacking have drastically increased density.

While the cost of storage has plummeted—dropping from over $8,000 per gigabyte in the early years to approximately 94 cents per gigabyte by 2013—low-capacity drives remain difficult to profit from. This is because the manufacturing costs for components such as the USB connector, controller, circuit board, casing, and packaging remain relatively constant regardless of the memory chip's size.

Furthermore, modern software requirements, such as Microsoft Windows installation tools requiring at least 8GB, have rendered 1GB drives insufficient for general use. While consumer-grade low-capacity drives are disappearing, specialized industrial and embedded sectors continue to utilize smaller capacities for compatibility and durability purposes.