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Global HDD Supply 70 Million Units Short in Q4 2011

By - Source: DigiTimes | B 36 comments

The global supply for hard drives will fall 70 million units short of the 180 million needed in 4Q11.

Following a similar price hike initiated by Acer, PC manufacturers Asus and Dell are expected to increase the prices of notebooks slated to arrive in December by 2 to 3-percent thanks to the current shortage of hard drives. In 4Q11 alone, the global supply is expected to be 35-percent short of the overall demand for 180 million units, leaving only around 110 to 130 million units available worldwide.

Retail channels in Taiwan have already seen a 20 to 30-percent HDD price hike since the flooding shortages began back in October, and will reportedly see another 10-percent price increase in December. Vendors like HP, Acer, Asus and Dell will get first priority, leaving the secondary retail buyers fighting for what's left -- some of which are already hoarding hard drives in fear of a depleted global supply.

According to unnamed sources in Taiwan, several PC manufactures are actually optimistic about the hard drive supply in 1Q12, believing that the shortage will finally ease before the spring. Other manufacturers aren’t quite so positive, predicting that supply will begin to pick up in the second quarter of 2012. Either way, PC vendors will likely see increased hard drive costs throughout 2012, as the supply chain won't return to pre-Thailand flooding levels for another nine to twenty-four months.

Earlier this month Nidec, the Japan-based hard drive motor supplier which contributes to around 75-percent of the global HDD shipments, said that its Ayutthaya plants in Thailand had already resumed production. The company also announced that it was increasing production capacities in Philippine and China to help cover the impact from the floods. Nidec said it believed its efforts should help narrow down the HDD supply gap in 4Q11 despite the gloomy outlook.

But some companies and analysts are preparing for the worst. "We could run out of drives by the end of November," Piper Jaffray analyst Gus Richard said in an interview several weeks ago. "Availability is really going to tighten up. I'm seeing prices quoted anywhere from up 10 to up 60-percent. Nobody seems to be really paying attention. Everyone overreacted to the disaster in Japan. And now I think they're under-reacting."

Could the current hard drive shortage pave the way for solid state disks to take over as the primary storage medium? Unfortunately they cost more per gigabyte than mechanical drives despite offering better performance and reliability. But SSD retail prices are falling, and are expected to continue to drop once 3-bit flash arrives in 2012 and as the industry shifts over to 29 to 20-nm process technologies. Until then, mechanical hard drives will likely remain the primary storage device for some time to come.

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Top Comments
  • 10 Hide
    danielravennest , November 29, 2011 2:05 AM
    On an annual basis the world wants 720 million drives, so the shortage is less than 10% of a year's demand. So everyone delays their next disk purchase by a month, cleans up some unneeded files, and we are good.
Other Comments
  • 10 Hide
    danielravennest , November 29, 2011 2:05 AM
    On an annual basis the world wants 720 million drives, so the shortage is less than 10% of a year's demand. So everyone delays their next disk purchase by a month, cleans up some unneeded files, and we are good.
  • 8 Hide
    de5_Roy , November 29, 2011 2:16 AM
    Quote:
    But some companies and analysts are preparing for the worst. "We could run out of drives by the end of November,"

    thailand's flood disaster is really a sad situation. but this looks like a ploy to exploit that situation using scare tactics and grim predictions to raise hdd prices during holiday seasons.
  • Display all 36 comments.
  • -1 Hide
    cmcghee358 , November 29, 2011 2:17 AM
    You're thinking of it too narrowly. Where do 95% of hard drives go to? Not newegg. It goes to the OEM builders. Most PC consumers don't buy independent drives, the drives come with their new PC.
  • 1 Hide
    cloja , November 29, 2011 2:17 AM
    Here in Peru is really crazy: a Seagate Barracuda 7200.12 SATA III 1TB 6 Gb/s (ST31000524AS) was $72 before and now is $175.00 a 136% increase. =(
  • 5 Hide
    alidan , November 29, 2011 2:18 AM
    danielravennestOn an annual basis the world wants 720 million drives, so the shortage is less than 10% of a year's demand. So everyone delays their next disk purchase by a month, cleans up some unneeded files, and we are good.


    10% lower but 100-200% higher prices...
  • 6 Hide
    Anonymous , November 29, 2011 2:29 AM
    We'll be peddling hard drives like they're illegal drugs.
  • 0 Hide
    livebriand , November 29, 2011 2:50 AM
    de5_roythailand's flood disaster is really a sad situation. but this looks like a ploy to exploit that situation using scare tactics and grim predictions to raise hdd prices during holiday seasons.

    *sigh* Why must they get the cheap hard drives compared to us? So what if they need it to keep the system prices low? They already bundle a bunch of bloatware, can't that help pay for it? If not, who'll notice a moderate increase in prices of those systems?
  • 1 Hide
    ltdementhial , November 29, 2011 2:56 AM
    clojaHere in Peru is really crazy: a Seagate Barracuda 7200.12 SATA III 1TB 6 Gb/s (ST31000524AS) was $72 before and now is $175.00 a 136% increase. =(


    here in mexico is worst they where in 67-70 dollars and now they are in 200 bucks...or 250 for 1.5tb...but an external USB 2.0 1.5tb is 112 greens...i bought 1 removed the HDD put an old 250 inside and gifted to my girlfriend xD
  • 4 Hide
    iamtheking123 , November 29, 2011 3:09 AM
    danielravennestOn an annual basis the world wants 720 million drives, so the shortage is less than 10% of a year's demand. So everyone delays their next disk purchase by a month, cleans up some unneeded files, and we are good.

    Your math is wrong. They were short 35% for just this quarter. They weren't short in the previous quarters this year because the factories were full steam (why you get 10% short). If we're short 35% another 3 quarters (which we will be according to estimates of when production will resume) then it means we'll be short 35% of a year's demand (4 quarters).

    35% short isn't enough to justify the massive price increases though. The price increase is a result of the shortage in production being exacerbated by vendors hoarding supplies using their OEM status to muscle out newegg shoppers.

    But still I'm wondering who the hell buys 700 million hard drives a year. I've bought 2 internal drives in the last 3 years.
  • -1 Hide
    _Cubase_ , November 29, 2011 3:10 AM
    ltdementhialhere in mexico is worst they where in 67-70 dollars and now they are in 200 bucks...or 250 for 1.5tb...but an external USB 2.0 1.5tb is 112 greens...i bought 1 removed the HDD put an old 250 inside and gifted to my girlfriend xD


    Here in America we don't tolerate that kind of crap... sir!
  • 2 Hide
    Anonymous , November 29, 2011 3:12 AM
    _Cubase_Here in America we don't tolerate that kind of crap... sir!


    I think that kind of crap isn't tolerated anywhere...
  • 5 Hide
    iamtheking123 , November 29, 2011 4:29 AM
    Pazero01I think that kind of crap isn't tolerated anywhere...

    A lot of countries bend over for it. A lot of gadgets that are "cheap" in the US are insanely expensive elsewhere in the world (usually because of crazy high import taxes).
  • 1 Hide
    Anonymous , November 29, 2011 5:51 AM
    The drives arent cheap in the U.S. either, I got a 2 tb drive for 89 bucks a few months back, same drive 199 now, and now only seeing 320gig or smaller for 99 or more.
  • 1 Hide
    ojas , November 29, 2011 5:51 AM
    iamtheking123A lot of countries bend over for it. A lot of gadgets that are "cheap" in the US are insanely expensive elsewhere in the world (usually because of crazy high import taxes).

    That's true...best example is south asia...

    Wasn't so bad in India last month...problem i cant give you prices in dollars because the exchange rate has fallen (in the dollar's favour) since august...but yeah prices are up 100% across the board. A 1TB HDD would cost about Rs.2600...right now a 500GB drive costs anywhere b/w 5000 to 6000 rupees...
  • 1 Hide
    teodoreh , November 29, 2011 6:14 AM
    Thailand flooding for magnetic disks will end up being the same thing as huge meteor towards earth for Dinosaurs. I already sell SSDs for repaired laptops, because nowadays a 64GB module costs the same as a 160-250GB 2.5" HDD!

    The tragic that no-one (mostly Seagate - WD) can't see, is that by giving high priorities on their permanent customers, the screw up the 2nd grade OEMs and distributors. And those distributors keep the remaining HDDs for their OEM PCs and screw the retail and small shops. So, before a couple of months, you could buy a 2TB disk for 60€+VAT, now the biggest distributors in my country sell 2TB disks for 125€+VAT, which is >100% increase in price! WTF!



  • -1 Hide
    randomkid , November 29, 2011 7:48 AM
    _Cubase_Here in America we don't tolerate that kind of crap... sir!

    What's the crap? Its plain & simple creativity.
  • 0 Hide
    Rizlla , November 29, 2011 7:54 AM
    In SA 500GB HDD would go for as little as R 339ex vat. Now it is at R 1095 ex vat.
  • 0 Hide
    shqtth , November 29, 2011 8:12 AM
    I think HDD shortage will help SSDs come down in price, as there is now a need created for SSDs to be more then 256MB due to no large capacity HDDs available to use as secondary drives (or primary)
  • 0 Hide
    shqtth , November 29, 2011 8:14 AM
    Its cheaper to buy an external HDD and put it in the PC. Externals have not gone up in price, i guess there is a lot of stock of externals left at retail stores.
  • 0 Hide
    srgess , November 29, 2011 9:17 AM
    only seagate got flood, wtf the other compagny do exploit that situation, i dont know the sale of seagate but i doubt they were on the top sale hdd, on the retailer side.
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