Seagate returns to notebook disk drive market

For the first time since it left the notebook hard disk drive market in 1998, Seagate Technology, a leader in the desktop hard disk drive market, on Monday released a new hard disk drive for mobile computers.

Dubbed "Momentus", the drive features a speed of 5,400 rpm. It includes a standard 2M-byte cache and users can also purchase an optional 8M-byte cache. Seagate, will be selling both 20G-byte and 40G-byte versions, and is currently shipping these disk drives to its original equipment manufacturer (OEM) customers right now.

Compared with a 4,200 rpm disk drive, Momentus is 47 percent faster at opening a 12M-byte Microsoft Excel file, 30 percent faster at copying a 170 M-byte folder, and 47 percent faster at shutting down Microsoft Windows XP, Seagate said.

Momentus will not be available to consumers right now but the company hasn’t ruled out the possibility of selling directly to the end-user if Momentus is well-received by the OEMs, said John Paulsen, manager of product communications at Seagate.

Seagate quit the mobile disk drive market five years ago at a time when mobile comprised only a small amount of the total disk drive market, Paulsen said.

The mobile market for disk drives is now the fastest growing segment of the worldwide disk drive market, said John Monroe, a vice president at Gartner. A company as large as Seagate could no longer afford to simply be a bystander in this area, he said.

"Seagate has made a timely and strategic re-entry into this market," he said.

The company says the Momentus disk drives are quieter than ever. Its new QuietStep ramp load technology parks the heads off the drive during standby and reduces the clicking sound made by notebook computers when unloading and loading heads to the ramp.

The 4,200 rpm disk drives are still the most popular for notebooks but it is forecasted in the next year that 5,200 rpm drives will become the most desired, Paulsen said. However, there are even faster drives on the market, but Seagate is looking to target a more mainstream market, he said.

"The bulk of drives going into notebooks now are still 4,200 rpm," he said. "Last quarter under five percent of drives going into notebooks were 5,400 rpm or higher, but the expectation among the analysts is that it’s going to grow to about 18 percent this year and getting up to around half (of all notebook drives) by the end of 2004."

Paulsen said Seagate wanted to enter the mobile disk drive market with a product that would "capture the greatest growth opportunity", meaning one that was going to appeal to the majority of notebook buyers.

"That also explains why we introduced a 20G-byte and 40G-byte product at the time," he said. "You are also seeing products released by our competitors that have 60G bytes or 80G bytes, so higher capacities are available. The sweet spots right now are between 20G bytes and 40G bytes, and 40G bytes is expected to be the sweet spot up until the end of 2004. By that time we will have released a next generation product," he said.

In 2002, 219.6 million disk drives were sold worldwide: 35.8 million were for mobile computers, 164.4 million were for desktop computers and 19.4 million were for servers, Monroe said. In 2004, the mobile market alone is expect to grow to between 46 million and 48 million worldwide, he said.

Roger Kay, vice-president of client computing at IDC, said this is the right time for Seagate to be entering this market.

"Seagate is well positioned, it is highly profitable, they have a big share position in the desktop market and so this is a logic product line extension for them," Kay said.

Even though Seagate has three competitors in the mobile disk drive market, Fujitsu, Toshiba, and Hitachi Global Storage Technologies (HGST), Monroe said Seagate's foray into this market will likely be successful. All three companies offer comparable drives to the Momentus, but Monroe said even with Seagate’s entry into the market the demand for mobile disk drives will exceed the supply for at least the new two quarters, so there’s definitely room for another player.

"The volumes that they’ve forecast for themselves are very conservative, are very doable, they want to have eight to 10 percent of the available market in December, so they’re ramping slowly over the course of the next six months. They’re doing it in a wise and good way, I think," Monroe said.

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