Seagate: HDD Shortage Will Be A Year-Long Problem
Seagate: HDD Shortage Will Be A Year-Long Problem
Posted 02/01/2012 at 11:28am
| by Brad Chacos
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A new year means a fresh start, and a fresh start entails putting 2011's skyrocketing HDD prices behind us, right? Not quite. Seagate released its quarterly financial results yesterday, and although the report left investors cheering -- Seagate pocketed $3.2 billion in revenue despite last year's catastrophic floods -- things are looking a bit bleaker for end users. Seagate fully expects the hard drive shortage to continue until the end of 2012 as manufacturers struggle to catch up to consumer demand.
Seagate says that the hard drive industry will probably end up around 150 million HDDs short of the demand for them by the end of the year. As far as last quarter goes, the company says the entire hard drive industry made around 110 million HDDs, shipped 119 million, and had demand for 175 million -- so it came far short of meeting customer wants.
Seagate's facilities weren't damaged in the Thailand floods, but it is still facing problems securing components from washed-out suppliers. PC World reports that seven of Seagate's top 10 suppliers suffered manufacturing damages during the floods. Things are looking even worse at Western Digital; WD did get smacked by the rising waters and doesn't expect to return to full manufacturing capacity until the third quarter.
Bottom line: things will get better eventually, but be ready to pay through the nose for a HDD for the forseeable future. For more info about HDDpocalypse, check out the lead QuickStart story in the print issue on stands now.
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glarry
February 02, 2012 at 8:37am
I understand that before the flood, hard drive manufacturing was fast becoming a non-profit venture. But as many here and other places have said, it seems the manufacturers have no incentive whatsoever to speed up the "return to normalcy" process -- it will only reduce their profits. Kinda like when there's a gasoline "shortage" and prices go up -- why on earth would a company want to work hard to get supplies back in the pipeline?? I will try to live on the terabytes I now have for another year, and hope (HA HA HA) the HD manufacturers will do the right thing and start lowering prices as the year wears on.
OCFRED
February 02, 2012 at 1:02am
Seems only lower end (WD anyway) units were affected, larger TB+ drives seemed to come from Malaysia and carry superior warranties anyway. Got a 2TB Caviar black for a little more than a buck a gig on sale last year which seemed reasonable enough.
vrmlbasic
February 02, 2012 at 6:13am
A buck a gig? 2 TB is 2000 GB, when it comes to drive capacity, so that means you paid over $2000 for a 2TB drive?!
livebriand
February 01, 2012 at 10:39pm
Because of the price gouging, there's a much higher chance that my next drive will be an SSD. Take that, WD and Seagate!
Keith E. Whisman
February 01, 2012 at 4:27pm
The HDD's manufacturers are probably going to take this as far as they can go. The manufacturers are probably going to resist the urge to fill their factories with as much production equipment as they had before. This is a great time for US companies to step forward and fill the demand.
Raswan
February 01, 2012 at 3:59pm
Seagate and Western Digital are both on the shit list. They managed to turn the flood into record profits by cranking out virtually the same number of units and charging three times more. Were they paying the workers in Thailand lost wages to make up for it? Doubt it. Never buying from these two again. I don't mind a little gouging, but c'mon.
praetor_alpha
February 01, 2012 at 3:44pm
As far as last quarter goes, the company says the entire hard drive industry made around 110 HDDs...
Surely you mean 110 million? I heard that Thailand had about half of the world's HDD production. The world HDD output has to be larger than just 220 HDDs.
tekknyne
February 01, 2012 at 11:44am
Well... then sounds like the solution to my storage needs will have to wait another year. Hey Seagate, since you made such a dumb decision to put all your eggs in one basket, does your bottom line reflect this or did you just pass the buck on to all of your loyal customers? That's a rhetorical question, I think we all know it's Supply-Side Economics FTW.
lostcause64
February 01, 2012 at 2:42pm
Yep, kinda reminds me of how the price of gas jumps up 30-50 cents a gallon in one afternoon, then takes weeks to trickle back down again. All without a single event going on anywhere that would logically cause it...
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