Seagate: Enterprise SSD to be released next year

Storage manufacturer Seagate will release its first SSD (solid-state drive) for enterprises by the middle of next year, CEO Bill Watkins said on Tuesday.

The product will be aimed at customers such as financial institutions that need to transfer lots of transactional data quickly, Watkins said.

To meet the high performance demand for financial transactions, companies such as EMC -- which buys disks from Seagate -- will string together ten 200G-byte drives but only use the very outer edge of the disk, comprising 20G bytes or so, for data. The disk spins the fastest on the outer edge, which gives the best performance.

But for companies, it's a waste of a lot of disk. Watkins said the Seagate SSD, which could cost around US$2,500 for 200G bytes, would be cheaper and provide the same performance, taking advantage of the fast read speeds for NAND flash. Between 5 percent to 10 percent of companies have a need for the technology.

The product will be a combination single-level cell (SLC) and multilevel cell (MLC) drive, Watkins said. SLC drives are more reliable and faster than MLC ones, but MLC drives are cheaper to produce.

Watkins affirmed again that Seagate has no interest in building a flash fab and would instead buy flash from a contract manufacturer. Companies that do have fabs, such as Samsung Electronics and SanDisk, are struggling to make money, Watkins said. It makes no sense for Seagate to enter a business where it can't make money, he said.

However, Seagate is investing in research to develop flash controllers and interfaces for SSDs, as those technologies will be key, Watkins said.

The forthcoming SSD release could be a welcome bright spot for Seagate in what executives expect will be a tough environment due to slowing IT spending.

Enterprise spending is expected to be frozen in the short term, said Patrick O'Malley, Seagate executive vice president and chief financial officer. However, companies are expected to increasingly need storage due to data retention regulations, he said.

Seagate is also shipping a full-disk encryption drive, which is appealing to enterprises when it comes to disposing of the disks. Watkins said Seagate has done work for the U.S. government and pulled data off a disk with a bullet hole. The threat of losing data is a concern to companies, he said.

On the consumer side, Watkins acknowledged the upcoming Christmas season will likely be difficult. "We're not sure it's [the holiday buying surge] going to show up," he said.

But Seagate's consumer business is now growing faster than the enterprise side, driven by a rising need to store photos, music, movies and other digital content.

Seagate holds about 32 percent of the overall storage market, the highest in the industry, according to the company.

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