The Hindu Business Line : On a sleek and fast drive

The hard disk drive (HDD) market is rapidly expanding and its profile steadily changing. Exponential growth in consumer electronics devices has meant an increased demand for smaller, thinner and higher capacity hard drives. Jaya Dharan, General Manager, Asia-Pacific (South), Hitachi Global Storage Technologies, shares with eWorld some key trends and how the business of hard disk drives is driven by entertainment and gaming requirements. Excerpts.

The HDD market is going through transformation, both in terms of price and higher capacities. How do you see the market?

The hard disk drive market in India is experiencing substantial growth, with 3.5-inch drives continuing to make up the majority of shipments. Increasingly, consumers are opting for high-performance 7,200 RPM (revolutions per minute) drives and those with extremely high capacities. The industry is maturing and moving away from a low-capacity, price-conscious market to greater demand for higher capacity, performance and throughput from HDDs.

Rapid growth in consumer electronics devices has also meant an increased demand for smaller, thinner and higher capacity hard drives. Device manufacturers today are looking for drives that use less power, have high shock tolerance and are easy to integrate.

Indian companies are leading the rest of the countries in Asia in demand for SATA (serial advanced technology attachment) drives, and this ties into Hitachi's strategy of providing quality and performance across its entire product range.

What are the key trends in the marketplace?

Rapid growth in consumer electronics devices has led to demand for smaller, thinner and higher capacity hard drives. Hitachi is working actively to meet this demand and announced `Mikey,' the smaller one-inch hard drive with 8GB; and "Slim," the world's lightest 1.8-inch hard drive for use in devices such as MP3 players, digital cameras and PDAs (personal digital assistants).

With hard drives increasingly being used in portable consumer devices, Hitachi has developed a shock-protection technology called Extra Sensory Protection (ESP) in its latest Micro-drive products. ESP is an optional feature that detects when the drive is in free-fall and safeguards against data loss by parking the read/write head away from the surface of the disk to avoid head/disk contact.

The Indian entertainment industry is expected to have huge storage requirements in the future. Hitachi is addressing this trend with shipments of high-capacity 3.5-inch Deskstar hard drives with features that make them well-suited for use in digital video recorders (DVRs).

With high demand for storage capacity, digital video applications are a key growth driver for Hitachi. The proliferation of digital video content, alongside the pervasiveness of broadband, makes India an ideal market for high capacity hard drives.

Growth markets for 3.5-inch ATA drives also include other consumer electronics applications such as PVRs (personal video recorders) and home media centres. Near line storage and video surveillance are other rapid growth areas where the Hitachi Deskstar product line is being used.

According to figures released by MAIT (Manufacturers Association of Information Technology), PC sales, including desktops and laptops, have crossed 11 lakh units in India (as of December 2005). The desktop market grossed 9.67 lakh units in Q3 2005-06, a growth of 5 per cent over Q3 2004-05 (year-on-year).Further, the Indian market is also beginning to see some desktop PC users shift to notebooks for mobility and space-constraint reasons. Many of these users are moving toward sub-notebooks that use smaller, 1.8-inch form factor hard drives.

Home entertainment too is poised for growth where people would need higher capacity HDDs. How do you see the industry growing in this space? Will broadband penetration drive this?

Hitachi is optimistic about the HDD integrated CE (consumer electronic) market in India, which includes home entertainment (HE). The concept of digital lifestyle has taken root in India. Today, the Indian consumer has a wide range of entertainment and communications offerings to choose from: new age home theatre systems, wireless networks, gaming consoles, security systems, etc. As these new technologies become mainstream, they will push the need for additional storage to keep pace with the data they generate.

As far as the HE segment is concerned, DVRs are a key area. Hitachi believes that 2006 will be the year of digital video and believes video applications will proliferate across all hard drive form factors — Smart phones with video download and viewing capabilities - (1" drives)

Video-based MP3, digital camcorders, personal media players, navigation devices - (1.8" drives), Automotive entertainment, console gaming - (2.5" drives) DVRs, video surveillance, standard and high-definition TVs, PC gaming (3.5" drives), Enterprise — streaming video, video-on-demand systems and uncompressed video editing.

The entry-level HDDs are constantly scaling up; what was not available in servers is now common in entry-level PCs. Your views?

This is true; as technology continues to advance, hard drive vendors are able to offer entry-level hard drives with sophisticated capabilities as compared to, say, a decade ago. Entry-level HDD capacities have moved from 40 GB to 80 GB. In India, 80 GB hard disk drives are the sweet spot of the market. Hard drive performance has also undergone similar transitions. Where 7200 RPM used to be the domain of high-end desktops and entry-level servers, it is now the mainstay for PCs and will soon be present in notebooks.

Hard drive interfaces have undergone some changes, as well. SATA was once utilised in entry-level servers, but it is now being used in PCs and notebooks, and India is an early adopter of SATA for the PC.

How big is the market? Is the entertainment industry driving this growth?

According to IDC, mid-range and low-end drives are seeing faster growth in the Indian context. The primary storage market in India is growing at a CAGR of 50 per cent in revenue terms, which is impacting the secondary storage market, as well. Also, near line data is now being put onto secondary storage devices.

As far as the disk storage market is concerned, it is expected that PC growth, which drove hard disk drives in 2005, will continue to do so in the near future.

Growth for HDDs within the desktop/notebook space will be further accelerated by the `digitisation' of lifestyles. Given that the concept of digital lifestyle has taken root in India, a whole host of entertainment and communications offerings are now available for the home users.

As far as the HE segment is concerned, DVRs will be a cornerstone for our success in India.

The Indian gaming market is also booming. According to industry reports, the Indian gaming market was expected to touch $50 million (mobile gaming not included) by end of 2005, opening a huge opportunity for vendors to tap into this emerging industry.

As gaming becomes more popular with Indian consumers, hard drives are expected to get a boost due to the increase in both PC and console gaming.

vrishi@thehindu.co.in