SINGAPORE--Forget about the "Armageddon"; focus instead on what hard disk drives and solid-state drives (SSDs) each have to offer, an industry observer urged original equipment manufacturers (OEMs) Monday.
OEMs that rely on SSDs need to tap on distinct advantages such as low power consumption, no noise, small form factor and robustness and realize the benefits in end products more effectively, David Reinsel, group vice president for storage and semiconductors at IDC, said at the Semicon Singapore 2008 conference.
Pointing to a December 2006 survey, Reinsel noted that consumers were most willing to pay between 10 percent and 20 percent more for SSDs, in exchange for the perceived benefits. But the benefits are still not commensurate with the premium, which today can be as much as 80 percent, he said.
In addition, OEMs will also do well to focus SSDs on applications that have low storage requirement, said Reinsel. One such area, he added, is thin client computing.
On the other hand, stationary applications such as data centers and desktop PCs are strengths of hard disk drives, and OEMs should be mindful that these higher capacity drives still offer substantial value. But at the end of the day, it does not always boil down to cost per gigabyte, Reinsel pointed out.
"We don't see this as an all-out, Armageddon war," said Reinsel, referring to SSDs and HDDs. Instead, SSDs will serve incremental opportunities to the overall storage market, he said.
By 2010, SSD shipments will hit about 28 to 32 million units with revenues of about US$3 million to US$3.5 million, according to IDC estimates. This is, however, a small fraction of HDD shipments which will reach over 600 million units, said Reinsel.
Rodney Morgan, executive officer at IM Flash Technologies, a joint venture between Intel and Micron, said there are "huge opportunities" in SSDs.
The company's manufacturing facility in Singapore, for instance, has the potential to expand to support SSD operations but the size of the opportunity depends on "the ability to execute on cost", he told ZDNet Asia at a media briefing Monday.
The local facility, however, will delay its operations until mid-2009, reported Morgan. This is due to a combination of factors, including cyclical semiconductor trends, global economic pressures and supply of flash outstripping demand, he said.
Consolidation ahead for SSD players
Judging from the evolution of the hard disk drive industry, the SSD industry with currently over 40 vendors appears to be headed for a period of "massive consolidation", Reinsel noted.
There were over 20 HDD vendors in 1994, shipping some 70 million units in a market worth US$17 billion, Reinsel pointed out. However, in 2007, there were only six major vendors with 502 million shipment units and US$32.4 billion.
In order to create better value propositions for customers, technology integration in the SSD industry is necessary and this makes it "natural" for industry consolidation, he said. Areal density, the amount of storage in gigabytes that can be packed into an inch of storage medium, is an area where technology integration is likely to take place.
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