Attaching Numbers to the Hard Drive Shortage
Now is not the time to buy a mechanical hard drive, not unless you absolutely have to. As you know, the recent flooding in Thailand hit the hard drive industry pretty hard (from a technology standpoint -- obviously the biggest tragedy here is the impact it had on people's lives), and even just a 1TB hard drive is going to set you back about $150 street, almost triple what they selling for prior to the flood. Is the shortage really that bad?
It's certainly looking that way. According to DigiTimes, Seagate just lowered its fourth quarter 2011 shipment goals for hard drives to 41-45 million units. That's a 10-18 percent drop on quarter, and it's a direct result of the flooding. Seagate isn't the only one expecting to ship significantly less hard drives in Q4 compared to Q3. Here's how it shakes out:
- Western Digital 3Q11: 58 million HDDs
- Western Digital 4Q11: 22-26 million HDDs
- Hitachi 3Q11: 31-32 million HDDs
- Hitachi 4Q11: 20 million HDDs
- Toshiba 3Q11: 22 million HDDs
- Toshiba 4Q11: 12 million HDDs
Getting back to normal production levels isn't as easy as simply fixing the factories. Seagate's factories are back online and producing HDDs again, but not at the same clip as before there's a shortage of HDD components.
Unfortunately, HDD volume and prices aren't expected to rebound overnight. In fact, some estimates have the shortage being an issue well into 2012.
Comments
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praack
November 21, 2011 at 6:59am
zoander has a point, there are other examples in the US where other consumables had product amounts decreased, then prices increased to deal with temporary shortages- then when the shortage dissapeared-the price floated a bit but never dropped again to pre-shortage levels. And the amount in the package never weent up to pre-shortage level either
anyone rememvber what it was like to buy a REAL pound of pre-packaged coffee?
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jonnyohio
November 20, 2011 at 12:54am
So who was the genius that said, "hey, I got a great idea! Let's manufacturer all the parts for hard drives in one country. What could possibly go wrong?"
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jbwhite99
November 19, 2011 at 9:28pm
While Seagate and Samsung may manufacture elsewhere, a lot of key components for all drives (including Seagate) are made in Thailand. I believe it was the stepper motor. In any case, I agree that the shoertage will be prolonged - I believe I read on this website earlier this year that the HDD makers were looking for a way to raise prices. I really think it will be later 1st quarter before this is fixed, but remember that it takes 6 weeks for an HDD to get to the US by boat, so could be April or May before prices fall.
SSD makers need to take advantage of this - whomever can churn out volume at a good price will win.
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mysteriousgamer
November 18, 2011 at 3:42pm
Ordered a Hitachi Deskstar 7K3000 2 TB on www.newegg.com on the 19th of September for $109.99. They are now $279.99 each.
Wow.
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lo_tek
November 18, 2011 at 1:50pm
Excuse me, folks, but the manufacturers just had a REAL flood and supplies are short at the moment compared to demand. Basic Econ 101 will tell you that low supply + high demand == higher prices. That is a law that cannot be circumvented. Even if governments stepped in and forced the prices lower, it would simply create a shortage and there would be NO hard drives left for sale at ANY price. So be thankful you can even get hard drives at all right now albeit at a higher price. No, this is not a "conspiracy". The higher prices are a natural economic response to market conditions.
Let's put it this way. If suddenly some company invented a fantastic new way of making a storage that would hold 100 TB of information for about $100 a unit and it lasted 10 years based upon tests and it fit right in with current motherboard setups, it wouldn't take very long for the usual hard drive production facilities to be put out of business. And it didn't take any "conspiracy" to do so, just good old fashioned free market economics.
So puh-lease, stop all the "it's a conspiracy to raise prices!" nonsense. If there really were such a thing going on, it wouldn't take a flood to do it. They could've just shut down factories to achieve the same effect.
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Turbo Charge
November 18, 2011 at 2:04pm
Seagate Hardrives are made in china and maybe in taiwan so hmmm what do you think just because western got flooded out in taiwan then seagate rasies prices too, and don't forget that seagate owns samsung hard drive division now, so you do the math.
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Turbo Charge
November 19, 2011 at 4:20am
Why don't you read labels on your hard drives, mine say's china on the seagate ones and thailand on the western ones , plus I research alot on news and information on what is going on. But sometimes you just got to read in between the lines of things it just take some commen sense. Thailand flooding left over 14,000 companys out of business including western digital now as for seagate they aquired samsung hard drive division but with the condition that they over look the manufacturing of the hard drives to make sure the process was done right, and samsung plant is located in china.
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Typo91
November 18, 2011 at 3:59pm
get used to the prices, this whole thing has been planned buy the harddrive companies, so they could have an excuess to raise prices together and keep them there.
Prices had only gotten so low due to rampent competition with each other for sales. They had a huge volume of drives and had to fight for the consumor focus to move the drives.
Now we are all hooked on the idea of picking up 4-8 drives for raid arrays with Mobos just around the corner shipping with 2 SAS ports (8 sata drives) or 14 Sata connectors!!
The thought of not having at least 2 TB of storage sounds like gimping any build. But its not 69.99 USD anymore.
Now they have learned thier lession, bringing production back to full bore will only cause them to have more drives to sell, which will only cause them to lower the price to move the quanity of units again, which now they know isn't worth it because we are showing them RIGHT NOW they can just charge 150%-270% the price and work way less.
I wont be giving them a penny. The price of a Terabyte should be about 35 bucks or less, and LESS as time goes, i fully expect to see 10 TB drives in a few years for 100 bucks or less.
Dont believe me? Watch, just like the gas companies (ooh nooo there is a war where the oil is, boo hoo, oil is sooo hard to get!) Oh btw pay no attention to our consequitive RECORD SHATTERING profits. Everyone in the company just likes those Mercedeces Benz for safety! Safety First!
Thats right i said it
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Danthrax66
November 18, 2011 at 4:04pm
Yes, they caused the flooding so they could not make HDD for amonth or so and then deal with short supplies so they could raise prices. RIGHT...
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BlazePC
November 18, 2011 at 10:32am
Poor research a good article doesn't make.
Fair to say prices have about doubled on aggregate, not tripled.
1 to 2 TB drives by the two top companies can be had for around twice what they went for pre-flood. Sure pricing varies - that's the free market - but this claim of triple the usual price is nonsense. Amazon is a great place to start the research process. Best Buy is even more astounding.
That said, I'm glad hard drives have ticked upward. For what a hard drive provides in the bigger scheme of things, they AREN'T commodities. They are a crucial part of any build and the life blood of everything data, media & apps.
Tripled in price? Come on.
The propaganda machine is a funny beast; in politics as it is in everything tech.
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Turbo Charge
November 18, 2011 at 1:46pm
Umm Yea they have gone way over double the price or tripled or in some cases even more and I have been hunting down price changes, you are right thou, you can find a better deal at best buy then say newegg {oh I can't belive I said that!} but it's true.
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Danthrax66
November 18, 2011 at 4:06pm
No it isn't that simple. Newegg sells out a lot faster than Best Buy would when it comes to actual components. So the shortage immediately affects them due to the volume in which they recieve orders for HDDs compared to Best Buy. Best Buy likely gets better prices on the drives as well since they are an actual store.
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cr8n
November 18, 2011 at 12:18pm
Well Blaze, here's the facts:
I ordered 2 HD204UI 2TB Samsung drives @ $79.99 ea. on 10/16/11. Those drives are now $219.99 (ref: NewEgg). That's pretty close to 3X; and actually, though I don't have the proof to back this up, I checked a week ago or so and they were $239.99.
So yeah.
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BlazePC
November 18, 2011 at 12:29pm
Sorry to hear you overpaid. Shame on you for admitting it.
The disk drive companies love that; more so Newegg.
One example doesn't a good argument make.
Words to key-in on next time you take the time to read thoughfully:
"on aggregate" which translates to averaged as a whole.
"start the research process" which means, learn to shop better
I won't sit and squabble with a single instance (example) of someone paying too much. I was just in BB this week and saw they had plenty of stock-on-hand at prices well south of 3X pre-flood pricing, much less 2X. The propaganda machine is in full swing to be sure.
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Slugbait
November 18, 2011 at 1:42pm
"One example doesn't a good argument make"
Fine, you get one more, then. I purchased a WD Black 750 for $59 shipped on Sept 14th from Newegg. That exact drive today is $178 shipped. You wanna know where you can shove the extra dollar above 3x?
Those of us who learned to shop better stopped shopping at BB a long time ago...sorry to hear you still shop there. Shame on you for admitting it.
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BlazePC
November 18, 2011 at 1:53pm
Waiting for you to show up slug. Your name says it all. Get out much?
Learn to internet. Newegg loves you long time.
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Slugbait
November 18, 2011 at 2:06pm
Typical reply from an empty flamethrower. I'd tell you to get over your mofo self, except I loves pwning you long time.
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cr8n
November 18, 2011 at 1:17pm
where did i pay too much? I purchased for 79.99 - you're quoting BB and Amazon - get real Mr "Smart Shopper".
At least I gave an example. Where's yours?
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j_j_montez
November 18, 2011 at 1:56pm
Newegg is normally my go-to place for any tech purchase, but they seem to have inflated their prices the most. I was a couple weeks away from buying a few 2TB drives when the shortage happened, so now I am watching the ads. Best buy, costco, and sams club are less than 2x the previous price, while newegg's prices have gone out of control. Some examples for you:
I can't put the link for Best Buy without the spam filter blocking my comment, so go to page 39 of this week's ad on best buy's website. 3tb is $169, and 2TB is $99
http://www.samsclub.com/sams/shop/category.jsp?categoryId=1135
I'm planning on buying a 2TB from costco on black friday for $69, which is a shame, since i bought one for that same price last year. I don't know what's going on with newegg, but they are no longer my sole shopping stop for drives.
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BlazePC
November 18, 2011 at 1:47pm
One simple set of price examples - do the math:
BB dot com Internal-Hard-Drives Desktop
If you're store doesn't have stock and you have to order, BB shows "ship to stores" in 3 to 5 days.
(they move inventory around in case you didn't know)
You start going down the show more proof trail or in-stock this vs. having to wait that, then I don't know what to tell you other than - grow some. Google is your friend. Use it.
Free markets = retailers charge what the market will bear. Economics 101.
Some folks can't bear to wait and will pay the inflated asking price without being prudent and shopping around.
And it should go without saying, this article is still poorly researched.
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Zoandar
November 18, 2011 at 10:18am
Reminds me of the ketchup 'shortage' in the 80s. It is logical to assume these inflated prices will remain as long the consumers allow.
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I Jedi
November 18, 2011 at 9:55am
Perfect. Just in time for when I plan to build my Ivy Bridge setup in February. I couldn't be more pleased with the flood screwing me at least another $300.
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