Toshiba Enters Consumer HDD Market As WD/Hitachi Merger Hangs In The Balance

A little over two months ago, Seagate completed its acquisition of Samsung’s hard drive division, leaving only three major players in the magnetic storage industry.

Actually, not quite three, as Toshiba remained as well. The problem was that this veritable “David” wasn’t actually in any position to take on what were the three remaining “Goliaths” of this industry. The reality is that Toshiba had been content with a somewhat smaller market share, focusing on notebook and enterprise drives.

This may be about to change, however, as word has it that Western Digital will be providing Toshiba the tools and licenses needed to build consumer grade 3.5″ hard drives. All of this will be in exchange for one of Toshiba’s 2.5″ manufacturing facilities. This industry bartering stems from an order by the European Union directed at Western Digital, stating that they need to make this concession if the Hitachi merger is to go through.

This is actually the first positive news pertaining to the magnetic storage industry we’ve heard in quite some time. It’s true, just as we thought the future of the HDD industry was going to be a potentially precarious duopoly, we find out that this segment will actually hold steady at three strong participants. Not only does such a circumstance mean continued competition for consumers, it also sets the stage for novel and innovative new products, as Toshiba is a brand new player in this game.

Indeed, Toshiba has their fingers firmly planted in some other pies that could definitely be of use as they begin their journey in this newly acquired market. What I’m talking about, specifically, is the fact that they’re a major player in the flash memory industry. In fact, it seems that Toshiba will end up being the only HDD manufacturer with a major hand in consumer oriented solid state storage, stemming from the fact that they themselves actually manufacture all the core components of SSDs. Such a situation not only gives Toshiba an instant leg up over their competitors, it also opens the door to more new markets.

One avenue in particular, that being hybrid drives, seems to be a perfect fit for Toshiba’s new found manufacturing and design capability. This relatively young market segment has been building momentum recently with OCZ’s Revodrive Hybrid (which actually utilizes a Toshiba HDD) and Seagate’s Momentus XT leading the way.

With only two major options for consumers to choose from, the opportunity seems ripe for the introduction of a strong third entry. With any luck, Toshiba will be able to score a hat trick in a market that really is an open net at this point. If they do, they’ll make it virtually impossible for the competition to check them into submission.