Consumer electronics opportunities for HDDs abound

Hard disc drives (HDDs) are traditionally seen as storage devices that only the IT industry uses. However, in recent years, more and more consumer electronic devices come with in-built HDDs too. Pete Andreyev says that 2004 could be the year when HDDs revolutionise a new generation of consumer electronic devices

For as long as I’ve been in the storage industry, I’ve envisioned a time when hard disc drives would be fashioned into everyday consumer electronics devices that enhance the quality of life. Despite many years of lying just beyond the industry’s reach, I’ve steadfastly believed that someday the industry would deliver products that would revolutionise a new generation of consumer electronics.

Looking ahead to 2004, I believe that a number of factors are coming into play that suggest ‘someday’ is now. Specifically, shrinking form factors to one-inch and smaller, massive multi-gigabyte capacities, and critical mass manufacturing volumes now make hard discs a highly competitive alternative for storing all ranges of media on consumer electronics devices. Already, about 10 percent of today’s hard disc drive shipments are being used in consumer electronics applications.

New devices

In Japan and Korea, a new generation of personal video recording devices already equipped with hard-drive storage is bending television programming to the convenience of the consumer. No longer must a family be home to watch a favourite show, or risk missing a crucial moment for a quick dash to the kitchen for a snack. In music, new MP3 players are available today, which redefine the boundaries of portable music. Where early generations of MP3 players provided a few hours of music, new devices can store entire libraries of music on tiny storage devices such as a 1.8-inch, 20-gigabyte disc drive. Others will surely follow given a total market potential that some analysts expect to grow from a base of 6.8 million units in 2002 to as many as 36 million units by 2007.

Video and music are just a start. Over the next several years, hard disc storage has the opportunity to play a central role in a vast array of consumer electronics devices, ranging from home security and maintenance applications, to personal medical storage devices, to automotive navigational devices, to wearable memory assistance devices, to virtual reality worlds on a life-size scale. These are real opportunities, not pipe dreams.

Impact

The pan-Asian impact on this new consumer opportunity for the hard disc storage industry will be threefold.

First, Asia—particularly Japan, and increasingly Taiwan and Korea—is both the leading and traditional source of inspiration for new consumer electronics, ahead of Europe and North America. Indeed, many Asia-based companies are worldwide consumer electronics leaders for more than 40 years. New generations of hard disc drives have the potential to unleash the region’s creative potential.

Second, Asia has been and will continue to be a vital source of manufacturing expertise both for finished consumer goods and for electronic components. Companies with a stake in the global consumer electronics marketplace are increasing their investment in manufacturing, particularly in China. Hitachi, for example, recently announced that it is relocating a majority of its media productions from the United States and Japan to China.

Third, all of Asia—and not just the mature economies of Japan, Korea, Taiwan, Hong Kong and Singapore—represents an enormous market opportunity for consumer electronics products as economic growth increases the spending power of populations eager to enhance family and personal life with affordable consumer electronics devices.

Challenges ahoy

The consumer opportunity, however, does not come without challenges. It will require that the hard-disc storage industry to be innovative in all that it does.

First, the industry must continue to be innovative in how we solve engineering challenges. Drives size must continue to shrink, and drive capacity must continue to rise. These are familiar challenges for the industry, and we’ve made significant advances in a very short time historically.

Second, our industry must be innovative in solving new engineering challenges introduced by consumer expectations that are far different than those of our traditional information-technology customers. We must understand, for example, how ruggedness, acoustics, power consumption and other factors affect consumer attitudes, and engineer our devices to meet new criteria for success.

Finally, we must innovate to meet new economic and organisational challenges. Mass-scale commercial success in consumer electronics requires affordable prices. Our industry is used to price competition, but our models are based on an IT world where product life spans are as short as two years. Expectations are different in consumer industries; some require the same product and part number to be continuously available for 10 years. Our success as individual companies and as an industry will be partly determined by our success in adjusting our business models.

These are not easy challenges, but they are surmountable and worth attacking—particularly given the consumer-electronics opportunity that lies at the industry’s feet. For as long as I have been in the hard-disc drive industry, it’s an opportunity that has always been just out of reach. As we look ahead to 2004, that is no longer true.

The author is vice president, Asia Pacific for Hitachi Global Storage Technologies. He can be contacted at pete.andreyev@hgst.com