SANTA CLARA, Calif.—Enterprise flash memory won't be able to realize its true business potential—projected to be in the $60 billion market range by 2012—until after history repeats itself.

The history we're referencing here is that of the disk drive industry, which in the early 1980s went through the same spate of difficulties (lack of standards, an overabundance of competitors, nagging quality-assurance issues) that now await the fast-developing solid-state memory business.

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"Customer adoption is the key factor," Michael Cornwell, Sun Microsystems' new head of NAND flash business development, told a packed room during the opening panel discussion on "Flash in Enterprise Storage Systems" Aug. 12 at the third annual Flash Memory Summit here. "The five or six largest OEMs will decide what they want to buy in the marketplace, and that's what the industry will follow.

"We can learn from what the disk drive folks went through. Back in the early '80s, there were dozens of hard drive makers, all scrambling to see who would win out. Now there are only six major ones left; they're still making and selling lots of drives, but the main difference now is that shipments are much larger. The customers made their choice then, and the same thing will happen in flash."

Flash memory is nonvolatile computer memory that can be electrically erased and reprogrammed. About 95 percent of the business now is consumer-oriented, primarily for iPods, cell phones, memory cards and USB flash drives for general storage and transfer of data between computers, cameras and handheld devices.

But that proportion will be changing over time. Industry analysts believe that the remaining 5 percent of the sector, composed mostly of enterprise flash users, has a huge upside, due to its power-saving attributes and fast random-access capabilities.