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Hitachi Global Storage Technologies, a large maker of hard disk drives (HDDs), reportedly plans to stop making miniature hard drives, whereas its rival Fujitsu cancelled plans to enter that market. The decision outlines the trend when flash-based storage solutions replace small HDDs.

Hitachi’s hard disk drive unit has already stopped making 1” hard drives and also plans to cancel further evolution of its 1.8” drives by Summer 2008, reports Reuters news-agency citing Nikkei Sangyo Shimbun news-paper. Meanwhile, Fujitsu, which has been planning to enter the market of miniature HDDs for some time now, decided not to start making small hard drives for consumer electronics, but to concentrate on flash-based storage devices.

The decision’s by Fujitsu and Hitachi leaves Toshiba in a very comfortable position. According to market researcher iSuppli, Toshiba commands 70% of 1.8” HDD market, whereas Hitachi only has 17% market share. Other companies, namely Samsung Electronics and Seagate Technology, supply 8% and 5% of miniature hard drives, respectively.

But the market of small form-factor hard disk drives is on the decline. The latest breed of Apple iPod portable digital media players use flash memory instead of HDDs, a lot of ultra-portable notebooks also use flash-based solid-state drives. Moreover, forthcoming mobile Internet devices will also rely on flash, not hard drives.

Hitachi will focus on 2.5” and 3.5” drives, anticipating strong demand for the bigger drives that are used in personal computers and digital electronics such as DVD recorders and which require maximum capacity. Last year Hitachi Global Storage Technologies became the first company to ship 1TB (1000GB) hard disk drive.

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