Looking at the D.A.V.E. device, why would Seagate go for disk-based storage when flash has already permeated the market for handheld devices?

Again, the problem is you can’t live with 16 gigs at the enterprise—you can’t live with it in your notebook, your desktop. But it’s a great application for your home. You’re not going to store all your content there unless it’s just music. If it’s video, high-def, you’re not going to do it.

A great example is the MacBook Air. You have a choice—you want to buy a 64-gigabyte SSD and you pay an extra thousand. That’s your choice. You don’t get better warranty, you don’t get better performance. You just pay an extra thousand dollars for less capacity. That’s my argument against flash.

We’ll have flash storage, but flash is just a component. It’s like a head or a disk, it’s not a solution. It’s a component. You have to put an interface on it, you have to put error correction, you have to put firmware, you have to make it look like a hard drive. We’ll do all that.

Where did hybrid drives go?

The reason you don’t get a solid performance improvement is because Vista doesn’t work that well yet. We’re going to try to keep working it, but hybrids, to me, are a natural solution. We’ll see hybrids out in two or three years if we can double the performance improvement. But all it’ll do is make a hard drive look like a flash drive with a lot more capacity at a lower cost.

The quote I always hear from Seagate is that storage increases by 40 percent each year…

Sixty, now.

How do you jump the wall then? What technology will bring us up to a terabyte and a half? Two terabytes?

People are digitizing content at about a sixty-percent increase in petabytes a year now. So every year, we are digitizing and storing sixty percent more petabytes than we did the year before. This is a lot of storage. That drives a lot of demand. And that demand will be fulfilled by higher-capacity drives in certain markets, or it’ll just be more units.

Is it a question of better technology, or just increasing the size of the drive by using additional platters, for example?

One of the great things about the hard drive is that we can probably drive sixty percent capacity-per-disc increases for the next five or six years. We understand our role in that a whole lot better, and probably underpin a lot more than the solid state guys.

"We’ll see hybrids out in two or three years if we can double the performance improvement. But all it’ll do is make a hard drive look like a flash drive with a lot more capacity at a lower cost."

What’s Seagate focusing on now?

The thing about Seagate, we’re in every market where storage is played. For the enterprise market, it’s all about improving performance. It’s bringing SAS interface to it. We just announced our terabyte SAS drive, so we’re the first ones to come out with a SAS interface for terabyte to bring really high-capacity, low-cost computing to those people that need a high-performance, high-ops SAS interface.

If it’s in the notebook, it’s about having a 250 gigabyte and a 500 gigabyte notebook drive. If you’re in consumer, it’s about getting the highest capacity you can at the lowest cost. If you’re in the desktop, it’s everything from a low-cost 80-gigabyte or 160-gigabyte model for the business world to having 7,200rpm high performance for certain parts. It’s different tiers for different markets.

The great thing about Seagate is we play in every market and every application, so we’re able to take our technology and put it in products. If we take our leading technology and put it in enterprise, we deploy it one way. We put it in desktop, we deploy it another way. We put it into consumer for DVRs, consumers are about noise—how do you get power and noise? So again, each department has its own thing.

If you’re an Internet guy, like a Yahoo, or a Google, or an AOL, you want the highest capacity drive you can get your hands on with the lowest power consumption. You don’t care about IOPS. You really don’t, because you’re just storing stuff and duplicating, and replicating, whatever. If you’re Morgan Stanley or you’re an enterprise EMC guy, you’re really worried about IOPS – there’s a lot of transaction stuff happening. So again, each part of our market has different criteria. What we try to do is develop the leading technology—based on whether it’s power, areal density, security, IOPS, whatever—and deploy that into a product that can optimize that product for the specific market we want to go after

If I spend a lot of money on areal density for gaming. That don’t mean nothing. If I spend a lot of money for IOPS for gaming, it don’t mean nothing to them. But if they get enough capacity at the right cost structure, that means a lot to them.

Up next: Placing Seagate amongst its peers and litigating the SSD patent war.