Miniature harddrives to fuel industry growth in 2005, report

Los Altos (CA) - After shipping 305 million units in 2004, the harddrive industry is expected to expand to rapidly this year. Market research firm Trendfocus attributes the growth to skyrocketing demand of of 1.8" and smaller storage devices.

Trendfocus estimates 2005 sales to climb 24 percent to 378 million units in 2005. While traditional harddrive sales are not believed to dwindle down, most of the growth will come from a fairly new segment of harddrives that are built into portable devices.

"Consumer electronics devices are rapidly incorporating harddrives, complementing core demand from PC and server markets," said John Donovan, vice president of Trendfocus. "It's not just digital video recorders and the Xbox, it's the iPod and its legion of clones that are stimulating innovation and investment. Harddrive sales to consumer electronics applications will account for approximately 20 percent of unit output in 2005, and are on a trajectory to surpass 40 percent by 2008," he said.

Sales of harddrives to PCs and servers were "exceptional" in 2004, according to the analyst, and will continue to be the backbone of storage demand for years. However, storage requirements for MP3 players, personal video players, and mobile phones, many of which will employ harddrives the size of postage stamps, re "skyrocketing". Trendfocus believes that the demand for miniature drives will double in 2005 and growing more than 50 percent every year until 2008.

Seagate currently is the market leader of the segment with a 26.9 percent share. Western Digital and Maxtor follow with 17.9 and 17.6 percent respectively. The fastest growing manufacturers of 1.8" or smaller harddrives are Samsung, Toshiba and Fujitsu with current market shares of 7.6, 7.2 and 5.8 percent.