If you manufacture hard drives the end is in sight.
I do not say this because I lost my third drive in six months yesterday. (Ok, I admit it. Maybe there is a connection. I might be a tad irritated. Death to hard drive manufacturers!)
The traditional hard drive is under siege. Gadgets are transitioning away fast and cutting edge laptops are giving up on them entirely. A previous disruption in the hard drive industry came with the transition from ‘large’ drive technology to ‘small’ portable drive technology. Brands collapsed. Companies changed hands. (Famously discussed in Clayton Christensen’s book The Innovator’s Dilemma)
Enter the solid state drive (SSD).
- They’re pricey.
- They’re small.
- They’re fast.
- They consume less power.
- They’re solid state. (SO THEY DON’T BREAK. Again. Not that I’m mad. I am a fanatic backer-upper. I just dislike the mojo that times breakdowns with important deadlines. Used to have this problem with copiers as well. I seldom use copiers anymore. So there.)
Last time around large drive manufactures did not jump on the small drive technology until it was too late. This time SSD technology also seems to be coming from alternative quarters – memory cards for your camera anybody?
- Chips instead of platters.
- Silicon instead of steel.
The benefit of silicon versus steel is overwhelming.
The only thing holding back the floodgates of SSD’s in laptops is price.
But both price and supply issues have a habit of being solved at the same, brief moment in time. At which point the consumer portion of the mechanical hard drive business will collapse.
Are Seagate, Western Digital, Hitachi and others aware of the threat? (Of course they are, a really popular book ripped them a new one over the last strategic blunder. Product managers have this message tattooed in strategic locations.)
Can they do anything about it? The interesting thing here will be to see what strategy is used to protect the brands. In today’s world of easy outsourcing, a popular brand can transition from manufacturer to pure marketer in the blink of an eye. Larger conglomerates have the strategic advantage of being in multiple industries and can transition technology between brands/needs, more easily maintaining their manufacturing base. We’ve been using SSD’s of various sorts in cameras and phones for years and those companies are on the fast track for increasing drive density.
One can even argue that all the hard drive manufacturers should do is milk the existing technological path for as long as they can and then license their brand name off to someone who is better at the SSD drives. Sometimes fighting is less profitable than giving in. Might not like the idea, but history is littered with companies who fought but still ended up as little more than a nameplate. You have to give it thought. It has to be one of the scenarios.
Transitions are difficult.
Even in high tech.
So, I leave you with a thought experiment in honor of Halloween. (Given the horror that can be induced by thinking about such things.)
Lets just say you happen to be a candy manufacturer who makes the greatest sweet of all time. You’ve perfected distribution, cost containment, supply chain, marketing. Heck, you’re even on twitter.
Then you read in the latest Scientific American that a quick implant can be tuned to provide all the satisfaction, plus some, that your candy provides.
With none of the calories.
Thoughts of the Borg? It’ll never happen? People will never do that? Got the disbelief out of your system?
What steps do you start taking now to maximize the value of your brand in the face of substitutable technology? The clock is ticking set somewhere around a decade. At least you have more time than the hard drive manufacturers.
Let’s see how far out we can go here, shall we?