Market Views: HDD Shipments Down 20% in Q1 2016, Hit Multi-Year Low
by Anton Shilov on May 12, 2016 8:00 AM ESTAverage HDD Capacities Continue to Increase
Despite the drop in HDD unit shipments, both sequentially and year-over-year, total capacities shipped by the two leading makers of hard drives increased in Q1. Seagate supplied 55.6 EB (Exabyte) of HDD storage last quarter, up from 54.6 EB in Q1 2015, but down from 60.6 EB in the previous quarter. The total capacity of Western Digital’s HDDs shipped in the first quarter of 2016 was approximately 62.2 EB, a moderate increase from 61.3 EB in Q1 2015.
When it comes to hard drives, one thing that has been growing quarter-over-quarter for a long time now is average HDD capacity, particularly in the enterprise segment, but not only there. In Q1 2016, an average drive could store around 1.4 TB of data, an increase of 28.5% (Western Digital) and 29.7% (Seagate) from the same quarter last year.
Average HDD Price Stays at $60 compared to Q1 2015
Despite the local price hikes by HDD makers, the industry can clearly produce more hard drives than it can consume, which is why prices of mass HDD models remain rather low. This will likely change in the future, when consumers shift to higher-capacity drives because of 4K UHD video or other reasons, but right now an average HDD from either Seagate of Western Digital costs approximately $60.
This will likely change after Seagate implements its plans to cut down its manufacturing capacities and supply-demand balance of the market will stabilize. However, it remains to be seen how significantly that is going to change going forward.
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nils_ - Monday, May 30, 2016 - link
Is anyone still buying those 15k or even 10k drives?glad2meetu - Friday, May 13, 2016 - link
I think people are waiting to see what comes out of the merger between WD and Sandisk. I am surprised that Seagate did not make a bid late last year for Micron.I think much of the blame for the decline in the PC market in general is due to Intel failing to innovate. The drop in HDD shipments effectively just mirrors the lower number of new computers being shipped. But that may be a bit harsh on Intel and the rest of the PC industry. It has become much more difficult to make a game changing product given the level of excellence found in existing technology. The same can be said for smartphones.
Hard drives may turn around in another couple of years if designers can get hybrid drives to work as intended. Or perhaps 3D XPoint lives up to the hype and changes the market in another few years.
There also is a risk that the cost reduction on SSDs comes back to haunt them. General consumers will just lump all SSDs together or may view them based on brand names. So SSD makers could get hurt if the cheapest SSDs run into more issues for consumers.
avbohemen - Friday, May 13, 2016 - link
With these numbers, I am wondering: does this include disks delivered to the cloud providers (AWS, Azure, Google), Facebook and other big consumers? They are always expanding their datacenters and use a lot of storage, while no one seems to really know how big their "market share" is. Can anyone share some insight in this?Pix2Go - Friday, May 13, 2016 - link
The numbers in the article do include those customers. They typically are the ones using "Enterprise" drives, with some exceptions.As an idea of how many drives they need, consider this random nugget from "the internet":
"The volumes of storage Google needs are insane: as the post notes, YouTube alone requires a petabyte of new storage every single day."
Yep, at least 1000TB a day in new storage requirements. And I'd bet that's a low estimate.
This link doesn't give a solid answer, but gives some ideas about how much data is really out there. https://www.backblaze.com/blog/200-petabytes-of-cu...
revanchrist - Friday, May 13, 2016 - link
Couldn't agreed more with what some already said. The per GB price of HDD will not go further down, it will just stay stagnant. Right now the lowest per GB price is on 3TB and 4TB drives, once you go further up eyeing for 5TB and more, the prices simply rocket sky high. I think in the future, all those 1TB and 2TB drives will go extinct while 5TB and higher prices will drop down to the level of 3TB and 4TB. 1TB and lower storage space belongs to the SSD, and it will happen very soon.StrangerGuy - Friday, May 13, 2016 - link
My educated guess is that costs of HDDs doesn't scale well at the low end since HDD manufacturers still have to build the entire drive assembly minus platters for a 1TB or less HDD while NAND is far more flexible in physical packaging.zodiacfml - Friday, May 13, 2016 - link
LOL. I feel bad for these ageing kings of storage.They have to throw out their cash and apply for some loans to be build a NAND fab. It is the only way to stay relevant for the next 10 to 20 years. SSDs are already eating from the top and bottom of the food chain. The last remaining stronghold of HDDs is cost per GB; but SSDs doesn't have to go there as HDDs didn't replaced Tape drives for cost per GB.
zodiacfml - Friday, May 13, 2016 - link
Edit: Got carried away and forgot WDs acquisition of Sandisk which puts them on track. Seagate, just do it.vivekvs1992 - Saturday, May 14, 2016 - link
Most of the reasons for declining sales are because of steafy decline in the pricing of small to medium capacity ssd, hdd are used for long term storage nowadays and those drives are never below 1tb, personally i have 2 2tb usb hdd, 1 1tb usb hdd and a 2 tb in my build, and 2 more 2 tb beauties are on their way... The thing is many of my friends don't consider that they can add another hard disk without removing the old one in a desktop, another lot of them don't need so m7ch storage and the last lot are unaware of this data expansion methodFriendlyUser - Saturday, May 14, 2016 - link
For a lot of stuff we have gone from "owning" digital libraries to "subscribing". If people had to locally store their netflix content or their Amazon books and their MP3s, the need for space would have grown considerably. With a fast network you can always rely on re-downloading content you want, instead of storing.Also, in my opinion, the industry has stagnated. Price per GB is today similar to what I paid the last time I upgraded my HDs, in 2009. This is unacceptable. I know I would have bought a ton of 2.5" 2TB HDs for backups and the like, but they are still priced at ~$100. Too expensive... Plus, there has been little progress with hybrid HD/SSDs, which would be a great solution for people who don't want to mess with multiple drives. In fact, all I see is rebranding the same drive with slightly modified firmware and selling it as "NAS" or "workstation" or "IP camera" or "NAS pro" or "Storage" etc.
They have been milking us for too long. Time to start innovating.