Is this the end of the line for 3.5-inch drives?

Larger and more bulky 3.5-inch HDDs to follow the floppy disc predicts IHS

Tags: Seagate Software (S.A.)Seagate TechnologyToshiba CorporationWestern Digital Corporation
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Is this the end of the line for 3.5-inch drives? The HDD industry will face myriad challenges in 2013, says IHS.
By  Manda Banda Published  March 13, 2013

The larger, more bulky, 3.5-inch hard disk drive (HDD) could be going the way of the floppy disc as form factors shift to smaller drives that have more capacity and fewer moving parts, according to IHS, the analyst and research firm that tracks the IT components sector.

The HDD sector was hard hit by  flooding in Thailand towards the end of 2011, resulting in high shortages, and prices climbing, as some factories were underwater. The flooding, according to IHS, was the worst in the past 50 years and resulted in more than two-thirds of the country being swamped.

However, while all the major HDD manufacturers are up and running again, the price of 3.5-inch HDDs has not returned to pre-flood levels, and the sector as a whole is coming under increasing pressure from solid state drives (SSDs), which benefited from higher demand - leading to lower prices - during the HDD shortage in 2012.

There are a total of three players in the hard drive space: Seagate, Western Digital and Toshiba. All of the three companies play in the traditional desktop segment although Western Digital agreed to sell one of its 3.5-inch manufacturing facilities to Toshiba, as part of its bid to buy a controlling stake in Viviti Technologies.

"The HDD industry will face myriad challenges in 2013," said Fang Zhang, analyst for storage systems at IHS. "Shipments for desktop PCs will slip this year, while notebook sales are under pressure as consumers continue to favour smartphones and tablets. The declining price of SSDs will also allow them to take away some share from conventional HDDs."

An IHS iSuppli Storage Space market brief indicates the entire hard disk drive (HDD) market is under a "relentless onslaught" from tablets, smartphones, and SSDs. As a result, it notes, global market HDD market revenue this year will drop to $32.6 billion from $36.7 billion, a 12% decline.

"HDD revenue will be flat for the next few years, amounting to $32.9 billion in 2016," said IHS.

IHS notes HDDs in general will still be the dominant form of storage this year and a major growth area will come from cloud-based storage. It adds that average HDD selling prices will drop 7% this year.

1699 days ago
Vinod Mehra

Move out hard disk and make space for SSD.

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