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Posted by on Jun 12, 2012 in Hardware Articles |

What is happening in the market for hard drives?

What is happening in the market for hard drives?

We leave the day with a theory. Of those who fall almost in the category of “conspiracies”, but in this case are supported by facts, figures are there and we can all watch. How do we speak? On prices of hard drives, flooding in Thailand and it would be a plot by and to trick users and raise costs unreasonably. Wow, meow, and all the cries of the animal kingdom as possible.

It is not the first time that we talked about it and in fact already been previously blamed the two companies mentioned above operate in a duopoly state, taking the whole market and doing whatever they want with it, since Western Digital Hitachi GST absorbed and Toshiba Storage Device , news that we had no idea until now and which we have not recovered from the surprise. For its part, bought Seagate drives division of Samsung and even became LaCie , as if the company is worth something, but it was there and took her away, leaving as the distributor of hard drives larger the planet .

So we know that WD and Seagate have the market on their hands. What did they do with it? First, go back in time. When there were several participants in the industry, fought each other to survive in a free market context, where the price war was merciless and policies used to achieve mass production with low cost products. However, even in times when they sold short, however much was made because they could not otherwise achieve reduced prices, causing the start to pile up in warehouses awaiting a buyer.

They were selling at very low profit margins, had too many drives in the cellar and also were required to continue to manufacture much, because if they made these devices by little they came out very expensive and if they could not sell what they had saved less expensive, less going to get rid of the new more expensive.

- What we do!? -

They cried as they ran in circles all manufacturers. That jumped Seagate and Western Digital and said:

“We have an idea. We buy all of you, we form a duopoly and set prices. Otherwise it falls apart. -

Said and done. Prices began to rise slowly until it was the perfect excuse to make them jump into the clouds: the flood in Thailand . Although the disaster was real, the value of the discs grew in an exaggerated manner. Here are some examples and variation in graphs:

What is happening in the market for hard drives? image 2

What is happening in the market for hard drives? image 3What is happening in the market for hard drives? image 4

What is happening in the market for hard drives? image 5

Graphic courtesy of the Department of Statistics and Graphic Design Betazeta

They say, Western Digital was the company most affected by the flooding of their factories in Thailand, which apparently was transferred to the rest of the industry as a global tsunami happened to visit Seagate, Toshiba, Hitachi, etc. etc.

With this, he began to say that the crisis was for long , that in two years is not going to recover and that crocodiles and snakes were attacking . But in a contradictory and soon the first signs of recovery, 

The good news for the item continued: Seagate has increased its profits by 1182% in 2012 compared to 2011 (yes, 1182), same company that announced spending of $ 2,500 million to buy back a large number of company stock, which once had to sell when things were bad. Western Digital did exactly the same by spending USD $ 2,000 million to repurchase shares, as if they knew in advance that soon these assets will be worth much money …

Despite all this, the price is up and shows no sign of decline. In fact, we keep saying it will not fall in the short term, and here is when we rub our head and say our favorite expletive. And no, we have no idea what will happen, because we are not in the offices of Seagate and WD to know what they’re up to, because apparently they have “the bull by the horns.”

The truth is that by creating the idea that hard drives were small, again the free market did its work for the benefit of those who put together the play. The same economic system that initially had almost buried when excessive competition, now helps to generate excessive profits under a duopoly, thanks to the simple fact that free market if a product is low, then it is expensive . We say there are few hard drives and they go up in price. Such as gold, diamonds and New Zealand women: and it is little expensive.

Oligarchy Market Continues HDD: Seagate’s Net Income Increases by 1200% (Softpedia)
Was Fake Crisis HDD: Seagate and Western Digital Post Big Profits (Softpedia)
Fake Crisis Confirmed HDD: WD Spends $ 1.9 Billion USD Another (Softpedia)
Remember Remember what did Seagate Last November (Darrell Blog)

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