A lot of hype but some useful stats and as I posted some days ago here on the "where will the new demand come from question" - this supports my notion of "don't worry, be happy" - build it bigger and they will just want more.
Only bummer is lots of competition and Asian companies seen getting even more fiesty:
biz.yahoo.com
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Friday April 24, 9:07 pm Eastern Time
Company Press Release
Research Report: HDD Industry On Solid, Accelerating Growth Path,
Fueled by PC Demand, Skyrocketing Storage Requirements
Cost, Technology Pressures Resulting in Lower Prices, Greater Value for PC Users; U.S., Korean,
Japanese Suppliers To Vie For Dominance in Classic Cost vs. Technology Battle
PALO ALTO, Calif.--(BUSINESS WIRE)--April 24, 1998-- The hard disk drive (HDD) industry is poised for tremendous
growth over the next four years, according to a market research report just published TRENDFOCUS, a Palo Alto, California
research firm.
PC shipments and evolving storage requirements will provide for a 14.3% compounded growth rate through 2001. The hard
disk drive industry shipped record 130.5 million units in 1997, and will ship 222.5 million in 2001.
PC shipments, growing sales of network servers and workstations, and rising storage requirements brought on by new
software, wider bandwidth in internet applications, voice recognition and the like are the main factors in the projections. ''Our
research demonstrates that the disk drive industry is poised to break out of its slump to post impressive gains in the coming
years,'' stated John Donovan, Vice President of TRENDFOCUS. ''Concurrently, prices will continue to slide down as
capacities and performance rise, so users will be treated to values unparalleled in the IT industry.''
Disk Drive Industry Sales, Units in thousands, revenue in millions ($)
1997 2001 CAGR
5.25" units 5,634 6,070 1.9%
Value $ 1,286 $ 837
3.5" units 108,410 186,619 14.5%
Value $ 21,249 $ 24,997
3.0" units 124 200 12.7%
Value $ 30 $ 35
2.5" units 14,785 26,910 16.2%
Value $ 3,032 $ 4,266
1.8" units 255 52 -32.8%
Value $ 55 $ 10
Removable units 1,298 2,455 17.3%
Value $ 367 $ 419
TOTAL UNITS 130,506 222,511 14.3%
TOTAL VALUE $26,019 $ 30,529
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Desktop PCs consumed the majority of disk drives in 1997.
However, the broad reach of sub-$1,000 PCs will force fundamental
changes in desktop pricing and supplier strategies. Single-disk
products will become more commonplace to support the desktop market,
which should remain dominant. Portable systems have suffered with a
poor price/performance ratio, but sales have grown regardless. "The
notebook PC pricing model is shifting and will become much more
cost-competitive," stated Donovan. The enterprise/server sector's
demand patterns for drives shifted downward in 1997, but growth in
server sales will be healthy through the four-year period, pulling up
storage requirements.
Average storage capacities have skyrocketed in recent years. The
trend will slow slightly in 1998 and 1999 before accelerating again.
"Entering 1997, the average disk drive for desktop PCs stored 1.4 GB.
At year's end, the average capacity was over 2.2 GB, a growth of 60%,"
adds Donovan. "This trend will generally continue, with fluctuations,
through 2001."
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Average HDD Capacity Per Desktop PC
1996 1.4 GB
1997 2.2 GB
1998 3.2 GB
1999 4.9 GB
2000 8.2 GB
2001 12.0 GB
With entry-level PC pricing rapidly approaching $500, drive pricing for that segment will collapse and pull down prices for
higher-capacity drives. ''A year ago, a 2 GB drive cost $210, now it is half that, and 4 GB drives have fallen slightly faster,''
added Donovan. ''We got what we hoped for: cheap PCs to broaden global usage. Unfortunately, this is recreating HDD cost
models and reducing profitability.'' Drives to support ultra-cheap PCs will need to be priced under $80, added Donovan.
U.S. HDD suppliers continue to dominate the market, but changes are underway. ''Non-U.S. suppliers made impressive gains
for the third year running,'' states Donovan. ''Fujitsu, Maxtor, Toshiba, Hitachi, and Samsung are all investing heavily and are
challenging U.S. dominance across the product spectrum. Since 1994, there has been a four-fold increase in non-U.S. market
share.'' TRENDFOCUS anticipates that non-U.S. vendors will continue to increase output to boost share and generate
sustained market momentum. This will force prices lower still.
''We believe that the industry's current issues are just a seam in the market's evolution. New operating systems, application
software, video editing, digital photography, home servers, and true internet usage via greater bandwidth will boost storage
requirements,'' added Donovan. ''This doesn't mean it will be smooth sailing for industry players. With the cheap PC and rising
areal densities forcing the industry into new design and price models and the competitive gap closing, the overall HDD contest
is changing. The focus will be on technology and cost, more than ever.
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Shane. |
