Maxtor Corp. is reportedly not going to make small form-factor HDDs that are used in notebooks, servers and various other applications. The reasons for decision are unclear.

Hard disk drive maker Maxtor Corp. said on Monday it has decided not to go ahead with previously announced plans to make a 2.5” disk drive and would take charges of $5.4 million to $7.0 million as a result. Maxtor said it made its decision on January 18, adding that it expects to spend $7.6 million to $9.0 million to pay third- party vendors for tooling, equipment, and component parts inventory related to the suspended disk drive, according to a report from Reuters.

With the trend towards minimizing servers and data storage applications it becomes crucial to offer high-performance low-size HDDs that would allow accumulating more data using less space and without affecting performance. Numerous companies, including Seagate Technology, Hitachi Global Storage Division, Fujitsu and Samsung, have been developing and marketing 2.5” HDDs to address those needs for quite a while.

The market of mobile computers, where 2.5” HDDs are used, is growing quicker than the market of desktops, where conventional 3.5” hard disk drives are usually utilized. Furthermore, profit margins on small form-factor HDDs is larger compared to that on typical hard drives.

Maxtor had planned to introduce the disk drive in 2005, but it is unclear, why the company decided to reject the plan.