NUTS! |
Editor:- January 24, 2011 -
Seagate has
published a
point of
view document (pdf) which apparently shows that the role of hard disks
is unassailable in the notebook market - no matter what happens in the next few
years with SSDs.
The analysis in their document suggests there simply
isn't enough
flash memory capacity to
hurt their hard drive business - and that creating the additional flash
capacity required - with current market prices - would be economic suicide for
any SSD maker rash enough to try.
Seagate's article steers the
reader towards thinking that the SSD market has a revenue ceiling which is
determined by the economics of the notebook SSD market.
The reasons
why users will buy SSDs - and their related value propositions were published in
a classic article by StorageSearch.com in 2005. That
SSD market
adoption model (and its previous 2003 edition) helped many SSD companies
understand the potentially huge market size which SSDs could achieve in the 5
to 7 years ahead period - and it still provides the best explanation of what
is happening in the SSD market now.
StorageSearch.com has always said
- that it's the enterprise server market which is the biggest opportunity for
SSD revenue - out of all the main markets which use SSDs.
In the
enterprise market SSD companies can leverage the raw costs of their flash chips
by more than an order
of magnitude compared to the prices they can charge for similar capacity
consumer SSDs.
Therefore
Seagate's inference that the glass ceiling for flash SSD economics is set by
notebook prices is absurd and misleading - by its sin of omission.
In
other respects - Seagate's positioning paper says very much the same as I did
in a 2007 article called -
How Solid is
Hard Disk's Future?
But a lot of people - especially investors -
may get the impression from reading Seagate's view paper - that the hard disk
market is unassailable by SSDs. It's not what the paper says. It is what it
implies.
If you ignore the enterprise server market - and the effect
that SSDs are already having on that - and the huge disruption that SSDs will
have on the enterprise market in the future - then you probably shouldn't risk
your money money in high tech stocks - but find another market that's easier
to follow - like sweetened fizzy water instead.
When it comes to the
consumer storage market - I did say that hard disks would continue to be around
for a very long time. But I also said that one day they
would be almost given
away free.
And when it come to the long term future of the
datacenter - in my Petabyte
SSD roadmap article I explained the business reasons why - even if
enterprise hard disk were free - users would still buy SSDs and choose to
migrate to a 100% solid state market by 2020.
I also predicted that
2011 (this year) would probably represent the peak historic revenue year in
the hard disk market. -But also I said I expected total HDD revenue to drop
away rapidly after 2011 and halve by 2016.
SSDs are the most complex
electronic devices in the world today. And there is
much disagreement within
the SSD industy itself about the best way to design SSDs and the best place
to put them.
The SSD market is complex. It's not a single market but
really a bunch of markets which have a shared technology
heritage in
memory and
controllers. But the
need to optimize SSDs for those diverse markets means they will get more
dissimilar in the coming years.
Seagate has analyzed the economics for
the least profitable part of the SSD market -
notebooks
- and extrapolated that the SSD market is going to stay small and not much of
a threat to its hard disk business. It's not the first time Seagate has said
something to undermine confidence in SSDs. It's part of a pattern which I
wrote about in my 2008 article -
Why Seagate
will fail the SSD Challenge.
Do I still think they will fail the
SSD challenge now?
I discuss the complexities of the SSD market with
focused key players nearly every day. The business challenges are hard enough to
solve for SSD's true believers. |
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Can a company like Seagate - who doesn't even
believe in the final destination find the right road through the SSD maze? You
can answer that one yourself. | |
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... |
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| ... |
| this way to the Petabyte
SSD |
In 2016 there will be
just 3 types of
SSD in the datacenter.
One
of them doesn't exist yet - the bulk storage SSD.
It will replace the
last remaining strongholds of
hard drives in the
datacenter due to its unique combination of characteristics, low running costs
and operational advantages. |
 |
... |
The new model of the
datacenter - how we get from here to there - and the technical problems which
will need to be solved - are just some of the ideas explored in this
visionary article. | | | |
| ... |
| SSD Pricing -
where does all the money go? |
| SSDs are among the most
expensive computer hardware products you will ever buy and comprehending the
factors which determine SSD costs is often a confusing and irritating
process... |
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...which is not made any
easier when market prices for apparently identical capacity SSDs can vary more
than 100x to 1!
Why is that? ...read the article to
find out | | | |
| ... |
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