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Facing a relentless onslaught from tablets, smartphones and solid state drives (SSD), global hard disk drive (HDD) market revenue in 2013 will decline by about 12% this year, according to IHS iSuppli market tracking firm. HDD gross and operating margins likewise will decline as a result of continued price erosion.

Revenue is set to drop to an estimated $32.7 billion in 2013, down 11.8% from $37.1 billion last year. HDD revenue will be flat the following year, amounting to $32.0 billion in 2014.

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

HDD vs. SSD

HDDs overall will maintain market dominance because of their cost advantage over SSDs, particularly when higher densities are involved and dollars per gigabyte are calculated. Moreover, HDDs will continue to be part of storage solutions even in ultrabooks in certain configurations.  

A major growth area for HDDs will be the use of hard disk drives in the business sector spanning the enterprise space, cloud storage, big data and big-data analytics. Bearing the lowest cost of any storage medium now on the market, HDDs will remain the final destination for the majority of digital content that need to be filed away.

 

Toward the last quarter of this year, Western Digital is expected to launch a 5TB helium HDD, catering mostly to data centers for enterprise servers and storage applications, further propelling the HDD space into overdrive.

Western Digital vs. Seagate

Western Digital is expected to continue battling archrival Seagate Technology for market leadership in both revenue and shipments, especially in the enterprise business segment. While Seagate had a 50% share of the enterprise market last year, the introduction by Western Digital of its new helium technology could catapult the manufacturer to the top at the end of 2013, dethroning Seagate in the process.

Optical Drives vs. Extinction

In the parallel market for PC optical disk drives, losses in both revenue and shipments are similarly expected. The declines stem from a number of reasons, including smaller chassis sizes for PCs, a shift in preference among consumers toward video streaming instead of using physical discs, and cost cutting from PC manufacturers that have lost interest in using optical drives. 

In what appears to be a grim scenario, the optical disk drive industry is expected to encounter continued challenges this year, such as those presented by thinner PC designs. Optical drives could eventually be abandoned by PC makers altogether.

Tags: HDD, Business, Seagate, WD, Western Digital, Toshiba, HGST

Discussion

Comments currently: 3
Discussion started: 02/05/13 03:02:35 AM
Latest comment: 02/05/13 11:02:01 AM
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1. 
If they are smart, they will simply invest in the new technologies and make SSDs alongside HDDs. It's never wise to continually beat a dying horse; not that HDDs are dying, just shrinking general purpose use.

Optical drives? Haven't used one in 6 years.
0 0 [Posted by: mmstick  | Date: 02/05/13 03:02:35 AM]
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Hybrid HDD already Exist, Question is the Aforadablity and Reliability. How ever its still inherit the low performance access time of HDD unlike the SSD
0 0 [Posted by: xentar  | Date: 02/05/13 05:55:16 AM]
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2. 
Hope they fix the pricing collusion. Where's the industry control? Checks and balances?

Waiting for prices to make more sense ...
1 0 [Posted by: andresgriego  | Date: 02/05/13 11:02:01 AM]
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