SSD becoming mainstream as Western Digital looks beyond HDD
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SSD becoming mainstream as Western Digital looks beyond HDD
  • CCTV 뉴스팀 기자
  • 승인 2015.10.23 15:14
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Michael Yang, Senior Director, Memory & Storage
Dee Robinson, Senior Analyst, Memory & Storage

Traditional hard-drive market is being threatened by solid-state drive (SSD) adoption, and the SSD market is becoming increasingly competitive, dominated by vendors who have access to captive supply. As such, hard-drive suppliers are looking to acquisitions within the flash space in order to better compete in this growing market. While the news that Western Digital (WD) agreed to purchase SanDisk is surprising, it makes sense when examined within the context of industry trends.

The SSD market is expected to finish above $13 billion this year and is projected to pass the hard-disk drive (HDD) market by 2019, with revenues of $20.8 billion compared with $19.6 billion for HDDs. It is more pressing than ever to be a SSD supplier and SanDisk is an ideal target for HDD suppliers such as Western Digital.

SanDisk has been struggling in the SSD market, particularly enterprise, this past year. Its acquisition of Fusion-io was a disappointment, and it has not been able to keep up with enterprise market, which is moving to lower-cost Serial Advanced Technology Attachment (SATA) solutions. It has fallen from third to fourth place this year in the enterprise SSD market share race. WD's Hitachi Global Storage Technologies (HGST) unit actually performed well, seeing its market share grew from fourth to third place. Combining these two companies might enable them to compete better with the likes of Samsung and Intel for the enterprise business, as they would have the scale, the flash, and WD's history as a storage vendor.

The NAND flash business is much more competitive and brutal than the hard drive storage business, which lacks any real competition. Samsung is an aggressive competitor, and it has been able to acquire significant market share in the SSD market by leading in technology (3-D NAND) and pricing. The industry also requires significantly higher capital investment, particularly as the suppliers move to 3-D manufacturing to catch up with Samsung. A storage company, such as WD, would have a steep learning curve in trying to compete in the flash market. However, it may have little choice but to enter this market for access to flash supply because flash-based SSDs are gaining market share at the expense of traditional hard drives. WD has made some flash related acquisitions in the past (Virident Systems and sTec), but they were smaller scale SSD vendors.

All the signs are pointing to Western Digital finally entering the SSD business by way of acquiring SanDisk and its well diversified portfolio of consumer and enterprise businesses. While there may be other suitors, such as Micron, IHS believes it makes the most sense for Western Digital to acquire SanDisk as it faces the certainty of declining industry and the need to position itself for growth.


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