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Posted by Damien Biddulph on Fri 11th Nov 2011



The full extent of the damage to HDD industry factories will not be known until the floodwaters recede, although it is already clear that there will be HDD supply shortages into the first quarter of 2012.

"In response to the crisis, priority will be given to the large PC manufacturers that drive HDD shipment volumes as well as to the high-margin products used in enterprise servers and storage," said John Rydning, research vice president, Hard Disk Drives and Semiconductors. "But the HDD vendors can't neglect their smaller customers, whose business will continue to be important once capacity is fully restored. Some interesting production and partnering arrangements with customers can be expected as HDD vendors scramble to bring production back up while simultaneously angling for a strategic advantage."

"The HDD shortage will affect smaller PC vendors and lower priced products most, including mini-notebooks (netbooks), emerging markets and entry-level consumer PCs. However, even the largest vendors are expected to face HDD shortages, particularly for portable PCs where the market is more consolidated," added Loren Loverde, program vice president, IDC Worldwide Consumer Device Trackers. "Nevertheless, the shortage will relieve some pressure on pricing and margins, and present some opportunities for strategic share gains among the larger players."

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