The price war in the hard disk market is over and average drive prices will increase this year, according to market research firm IDC.
Average prices for desktop PC drives had hovered around the $160 to $170 region for several years, regardless of capacity, before tumbling to less than $130 during 1998. This is according to Robert Peyton, the director of IDC's European storage research group.
"The problem was that the brutal price declines were not accompanied by [manufacturing] cost reductions," he said, adding that he expects desktop PC drive prices to increase throughout 1999, maybe up to $140, though not back to $170.
He predicted too that drive capacities would increase more slowly in the future, noting that the price war drove companies to double their drive capacities every 12 months.
"This is not sustainable," he explained. "The rate of change will go back to what is sustainable by areal density increases." In other words, the number of bits per square inch of the physical disk surface. This could mean drive capacities doubling every 15 months, as they did in the years up to 1997, he suggested.
Peyton added that in the market for removable storage, other formats such as tape, magneto-optical and removable hard disks, have all taken a battering from the huge success of CD-R and CD-RW. Tape in particular is almost extinct on personal PCs, he said.
The key point for each removable format has come when it has been able to offer 15 per cent of the average capacity of a desktop PC hard drive, which stood at 4Gbyte last year, he said: "Zip came in at 15 per cent of hard disk capacity and CD-RW started replacing Zip and LS-120 in 1998, also at 15 per cent."
Based on this, he forecast that the market for rewritable DVD drives would not open up until 2001. "That's unless something else happens - and it usually does!" he joked.
A panel of representatives from one of the competing rewritable DVD drive consortiums, including Sony, Hewlett-Packard and Mitsubishi, said it expected its first range of DVD-RW drives to come to market later this year.
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