The hard drive drought is over

Summary:The flooding in Thailand last year knocked out a quarter of the world's disk drive production capacity, causing shortages and price spikes. But that's all behind us now.

Just before the floods, benchmark consumer hard disk drive (HDD) prices for raw drives online were commonly in the 4¢/GB range. We're seeing that number again - and expect to see 3¢/GB in some scattered instances before Christmas.

As I said back in May, when some predicted permanently higher prices for HDDs

Drive prices will largely be back to normal by year-end. Seagate and WD won't like it, but they'll just have to deal.

With PC sales declining and the threat of SSDs, drive vendors can't afford to get greedy on pricing. They need the volume and they can't make SSDs any more attractive than they already are.

At the same time, all 3 drive vendors - Seagate, WD and Toshiba - have very profitable and fast growing external storage product lines. Most people would rather buy a subsystem than stick a raw drive into an enclosure, even though that takes all of 5 minutes.

So vendors have less need to sweat the raw drive price and more need to drive production up to keep unit costs low. In fact, during the drought, it was cheaper to buy external storage, pull the drives and throw away the enclosures than it was to buy naked drives.

Don't believe me? Check out the amusing story of Farming hard drives: how Backblaze weathered the Thailand drive crisis. One of my favorite online backup providers, Backblaze bought thousands of external drives for use in their capacity-thirsty storage pods. And saved a bundle in the process.

The Storage Bits take Vendors can take heart in the fact that hybrid drives - combining SSD and HDD technology - will give them some breathing room in the fight against SSDs. But raw $/TB prices have to keep dropping to keep volumes up.

And that's good for us capacity hungry consumers.

Comments welcome, of course.

Topics: Storage

About

Robin Harris is Chief Analyst at TechnoQWAN LLC, a storage research and consulting firm he founded in 2005. Based in Sedona, Arizona, TechnoQWAN focuses on emerging technologies, products, companies and markets. Robin has over 35 years experience in the IT industry and earned degrees from Yale and the University of Pennsylvania's Wharton... Full Bio

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