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Interview: No solid-state HDDs for Western Digital

Matt Grainger
Interview: No solid-state HDDs for Western Digital

Western Digital is a company that has slowly but surely been acquiring market share for the past five years.

With a clear idea of its own capabilities and strategies, the firm has grown by twelve per cent over the past five years to encompass 31 per cent of the global memory market and almost doubled its revenue over the same period of time.

“Market share is the ‘customer vote’ on whether or not you’re delivering value in to the market place,” said WD’s chief executive, John Coyne, at a press event in Berlin, and it’s clear that he attributes this growing customer vote to the company’s investment in to research and development both in to products and production – at a rate that he says outpaces any other company in the industry.

And well it might. According to information put forward by IDC, the amount of digital content that will require some form of storage is set to grow forty-four times over between now and 2020, while storage capacity will only grow by thirty times leading to a sixty per cent discrepancy between supply and demand. So there’s no doubt that WD foresees a future of opportunity within the digital storage space and is currently positioning itself to make the most of this expected demand.

Perhaps one indication of this long-term thinking was the acquisition of Hitachi Global Storage Technologies earlier this year, which spurred a flurry of speculation in some quarters that cheap solid state hard drives were on the way.
In fact, some journalists were in for a disappointment, as WD made it clear that providing solid-state hard disks did not fit in to the company’s strategic vision. Using an analogy of freight transport, vice president of marketing Rich Rutledge explained that SSD was like air transport, fast and cutting edge when compared to trains, shipping and road freight but ultimately the least cost effective route for delivering high volumes of cargo.

“Storage has been driven by digital content, but consumers are driven by price” Rutledge told PCR. “SSD is a fantastic technology but I call it an ‘ultra’ technology. It’s great for ultra-thin devices or ultra-high performance, but it’s more of a premium technology and clearly the cost is anywhere from ten to twenty as much as a hard drive.

“There were 80,000 petabytes shipped in Q3 2010 and there were under 2,000 petabytes of Flash shipped. So, it goes back to the planes, trains and trucks analogy. It’s a fantastic technology but most freight is done by boats and train because it’s more cost effective.”

Despite disappointing solid-state enthusiasts, WD’s position on the provision of SSD technology did indicate that the company knew what its goals were, having identified three key areas of interest; the public cloud, the private cloud and the personal cloud – which essentially equate to web scale datacentres, corporate IT server rooms and thin client management, and household NAS storage.

Western Digital has clearly identified opportunities for each of these tiers of usage, from the 200,000 to 500,000 hard drives used in internet server farms to the increased net accessible storage demand generated by smart phone users.

“I think the people in the investment community who follow us have done that same level of query and are quite comfortable that each level of cloud is an opportunity for Western Digital,” continued Rutledge.

“Looking at the private cloud, this is quite honestly a marketing term to describe traditional IT, and the companies that have traditionally served that market – IBM, EMC, NetApp, HP – have had a vested interest in preserving the status quo, because they would still like to sell hardware one building, one company at a time, because that way they can continue to sell a very small amount of hardware to a very large amount of buyers.

“Obviously, from an economic point of view selling a large amount of hardware to a small number of buyers is not as attractive, right? By comparison Google is a very rich company with a lot of smart people, so they tend to build their own data-centres – they don’t buy third party systems – so that’s not as lucrative for someone like EMC, but it can be for us.”

At the other end of the scale, WD has a clear idea on how storage will become an integral feature in the household of the future following the concept of the connected home.

“Clearly retailers are more focused on our direct attached storage line, that part of the business,” noted Rutledge, “but as the world becomes a ubiquitous multi-device space, I think our network attached products will become a larger focus. And then once you have that content you would usually like to consume it, which is where we have the media players, and then you’ll find that if you have high definition content, today’s wi-fi is not really optimised for HD, which is why we have the networking products.

“We’re using the marketing line – create it, store it, move it, consume it – so we believe that anybody that uses any of those “its”, meaning digital content, can benefit from that opportunity.”

Western Digital has obviously put a great deal of thought in to its strategy for the forthcoming year, having grown its product lines to encompass every usage pattern for storage at the end-user level and carefully watching where large scale data users such as Microsoft and Google are making their investments.

“It’s a step-by-step basis," observed Rutledge. “Our success has been in understanding who we are today, identifying the next step, and then performing in that business. So we’re a very step-by-step company and when you do that properly, you get the kind of sustained growth that we’ve seen over the last five years.

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Tags: digital, wd, interview, future, plans, solid, state, western

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