HDD margins squeezed as market faces double-digit decline

Storage technology to face stiff competition from all sides, predicts IHS iSuppli

The hard disk drive (HDD) market will suffer a double-digit sales decline in 2013 as the technology finds itself beset on all sides.

According to projections from IHS iSuppli, HDD global market revenue will decline about 12 per cent this year to $32.7bn (£20.7bn), with margins taking a hit as average selling prices fall seven per cent.

Sales of the technology are expected to suffer from the decline in popularity of notebooks and desktops, as compared with tablets and even smartphones. The falling cost of solid-state drive (SSD) technology will also eat into HDD's share of the market.

However, the analyst expects HDD to "maintain market dominance", with the technology still being used in ultrabooks, as well as finding sales opportunities from enterprise trends such as cloud storage and big data.

Western Digital and Seagate are expected to continue to slug it out for shipment and revenue leadership of the market. Seagate held a 50 per cent share of the enterprise market last year, but IHS iSuppli believes Western Digital could retake the top spot this year with the launch of its new helium technology.

Fang Zhang, analyst for storage systems at IHS, said: "HDDs will continue to be the dominant form of storage this year, especially as demand for Ultrabooks picks up and hard drives remain essential in business computing."