HDD Market Recovering After Devastating Thai Floods
The hard-disk drive market is slowly recovering in the wake of flooding in Thailand, according to an IHS iSuppli report.Hard-disk drive average selling prices, though recovering from the devastating flooding last year in Thailand, will not reach pre-flood levels until 2014, according to an IHS iSuppli report. Meanwhile, HDD production is rising and will recover completely by the third quarter, the report noted, after the flooding caused a 29 percent plunge in shipments in the fourth quarter. Average selling prices (ASPs) held steady in the first quarter at $66the same as the ASP for the fourth quarter of 2011, though the report projected that would dip slightly to $65 in the second quarter of the year. The rise to $66 from $51 represented a 28 percent gain from the third quarter 2011, the report noted. Meanwhile, HDD production, which plunged 29 percent in the fourth quarter of 2011 due to the flooding, is expected to fully recover by the third quarter of this year.
HDD manufacturers now have greater pricing power than they did in 2011, allowing them to keep ASPs steady, Fang Zhang, analyst for storage systems at IHS iSuppli, said in a press statement. With the two mega-mergers between Seagate/Samsung and Western Digital/Hitachi GST, the two top suppliers held 85 percent of HDD market share in the first quarter of 2012. This was up from 62 percent in the third quarter of 2011, before the mergers. The concentration of market share has resulted in an oligarchy where the top players can control pricing and are able to keep ASPs at a relatively high level.