Western Digital Acquires Embedded SSD Maker for $65M
SiliconSystems' SiliconDrive products are used in network communications, industrial, embedded computing, medical, military and aerospace markets. The acquisition is expected to greatly boost WD's know-how and IP in the area of solid-state drives, analysts say.Western Digital, the second-largest hard disk drive maker in the world behind Seagate Technology, said March 30 it had acquired neighboring SiliconSystems for $65 million in cash. WD is located in Lake Forest, Calif., only a few miles from SiliconSystems' headquarters in Aliso Viejo, Calif.
SiliconSystems, founded in 2002, is a major supplier of embedded SSDs (solid-state drives), and its SiliconDrive products are used in the network communications, industrial, embedded computing, medical, military and aerospace markets. These markets accounted for approximately one-third of worldwide SSD revenues in 2008, the company said.
SiliconSystems' product portfolio includes solid-state drives with SATA (Serial ATA), EIDE, PC Card, USB and CF interfaces in 2.5-inch, 1.8-inch, CF and other form factors.
Integration into WD begins immediately, with SiliconSystems becoming the WD Solid-State Storage business unit..
Western Digital toyed with the idea of buying Fujitsu's spinning disk drive business in 2008 but didn't, due to the decline of the dollar compared with the yen. Toshiba then stepped in and acquired the Fujitsu hard drive division.
That's apparently when WD decided to invest in SSDs.
"WD is no stranger to SSDs, having dabbled in the technology in the early 1990s and being a founding investor of SanDisk, which also developed flash-based SSDs in the same time period," said Gregory Wong, an analyst with Forward Insights.
"However, it appears that early experience wasn't enough for a latecomer to catch up to the vast improvements in performance and reliability made by SSD vendors recently. System-level solutions, particularly on the firmware side, are required to manage the increasing complexities of NAND flash with each new technology generation."
WD will now be able to leverage SiliconSystems' know-how and IP to accelerate its SSD development, Wong said.