The hard drive market has sailed through a lot of turbulence over the last two years, and when we say sail we are obviously referring to the 2011 floods in Thailand.
The floods wreaked havoc on a number of component fabs catering to leading HDD producers. As a result hard drive prices skyrocketed and did not stabilize for almost two years.
In fact, hard drive prices remain stubbornly high, despite the fact that the floods hit in October 2011. According to IT Wire, prices of desktop 3.5-inch drives are still up 12 to 14 percent, which is also indicative of soft demand for desktops. Although notebook sales remain slow, prices of 2.5-inch drives are going down.
However, prices of solid state drives have tumbled over the past two years, although they seem to be stabilizing. Demand for NAND remains strong, propped up by tablets and smartphones, hence SSDs are experiencing massive price drops, which were expected by some observers a few years ago.
Although SSDs are a lot cheaper than two years ago, they are still too expensive for many applications. Small solid state drives are starting to squeeze out small hard drives, but this is a painfully slow process. Due to their size and power efficiency, SSDs are doing particularly well in notebooks. Hybrid drives are also becoming a very interesting choice for desktops, cheap notebooks and even enterprise applications.
The consolidation of the hard drive industry, which is now practically a WD – Seagate duopoly, also has the potential to drive up prices. Luckily, SSDs should keep hard drive prices in check, as their increasingly competitive pricing will leave very little wiggle room for hard drive makers.
