Seagate says GFC, not storage optimisation, stalling disk sales

Seagate says enterprise disk sales are yet to return to levels seen before the global financial crisis, but the company is banking on new interfaces for solid state disks and denser 2.5 inch drives to entice customers into more storage spending.

Sales of Seagate Technology’s enterprise disks are yet to return to levels it experienced in late 2008, before the global financial crisis, according to Teh Ban Seng, the company’s Vice President and Managing Director for Asia Pacific Sales and Marketing, with the global financial crisis rather than smarter storage management to blame for the slowdown in sales.

“The main reason for the decline was economics: companies postponed refreshes, upgrades and purchases,” he told SearchStorage ANZ. Mr. Ban Seng rejected the idea that software vendors’ promotion of storage optimisation software, or growth in adoption of data deduplication, have impacted disk sales by increasing utilisation rates and therefore removing the need for new disk purchases.

“Optimisation and deduplication are somewhat negated by growth in storage consumption and demand,” he said. “But the underlying demand is there and you will need to add more storage.”

Mr. Ban Seng says Seagate believes the storage its customers add will come in 450GB and 600GB 3.5 inch drives, capacities he believes represents the new “sweet spot.” He also expects 2.5 inch drive sales to surge, thanks to their combination of smaller physical sizes, lower electricity consumption and greater densities. “We see migration to 300GB 2.5 as a trend for 2010,” he said.

Another trend he expects to see in 2010 and beyond is increased adoption of solid state disks (SSDs).

“We predict SSDs will be 10-15% of the enterprise disk market in the next two years,” he said, adding that Seagate has plans for new products in this market.

Describing the company’s current product as “first generation” he said the company has plans to introduce SSD products with “different capacities and flavours.” Pressed by SearchStorage ANZ to explain “flavours,” Ban Seng said the company will add interfaces other than SATA to its SSDs this year.

Ban Seng also confirmed 2013 as the year in which he expects disk manufacturers will deliver the first see magnetic disk products based on next-generation disk media technologies HAMR or Patterned Media.

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