Leading industry watchers like IDC and Gartner early this year predicted that the first quarter of 2016 would not be good for the PC industry and various companies agreed with that. The reasons for the declines are well known: global economic issues, the slowdown in China, the strong U.S. dollar as well as competition from smartphones and other devices. As sales of PCs were not strong as predicted, this negatively affected the hard drive market.

According to Gartner, PC shipments worldwide totaled 64.8 million units in the first quarter of 2016, a decrease of 9.6% from Q1 2015. The company notes that this was the first time since 2007 that shipment volume fell below 65 million units. Analysts from IDC are even more pessimistic because based on their findings, shipments of PCs in the first quarter totaled 60.6 million units, a year-over-year (YoY) drop of 11.5%. As we noted in our previous coverage of the HDD market earlier this year, the decline of HDD shipments in 2015 significantly outpaced the regress of the PC market. As it appears, the same happened in the first quarter of 2016 as the total available market of hard drives dropped to a new multi-year low.

Shipments of HDDs Total 99.8 Million Units in Q1 2016

Seagate, Toshiba and Western Digital, the three remaining producers of HDDs, shipped a total of 99.8 million hard drives in Q1 2016, or 20% less than in the same period a year ago according to their estimates (see counting methodology below). According to estimates from Nidec, the company that sells the majority of small precision motors for HDDs (over 80% of them, based on its own estimates), the industry sold 98 million hard drives in Q1, but it is worth noting that Nidec is typically very conservative. In the same quarter of last year, Seagate, Toshiba and Western Digital sold 125 million HDDs, whereas just six years ago the industry shipped 163 million units. In fact, even in Q1 2006, sales of HDDs totaled 101.7 million units, according to iSuppli (via EDN), which means that we might be talking about a 10-year low in hard drives shipments.

Sales of PCs in general (and hard drives in particular) are seasonally not strong in the first quarter of the year, which is why it is not surprising that they declined to around 100 million units from 115 million units in Q4 2015. What is alarming is that despite this seasonal change, Q1 2015 shipments of HDDs were higher than sales of hard drives in each of the remaining quarters last year. If this year follows the same negative pattern, then HDD shipments will be below 100 million units in the second quarter and will remain below that level in the second half of the year. Western Digital estimates that total available market (TAM) of HDDs will decline to 95 million units in the second quarter, which means a decline of around 15% from the same period last year. A moderately good news is that Western Digital seems to be optimistic about the second half and believes that HDD TAM will remain above 400 million units mark in 2016 (compared to 456 million units in 2015), which means that shipments of hard drives will grow in calendar Q3 and calendar Q4. IDC has asserted that inventory reductions, cautious buying and other additional elements of the equation that directly affected makers of components in the recent quarters are wrapping up, Western Digital’s optimism could well be justified.

Market Share: Seagate, WD and Toshiba Shipments
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  • darkfalz - Thursday, May 12, 2016 - link

    Waiting for external drives of 8 or 10 TB (not SMR). Then I'll buy a couple more. Reply
  • takeshi7 - Thursday, May 12, 2016 - link

    They've had non-SMR 8TB drives for a while now, and you can buy a 10TB non-SMR drive right now.
    http://www.amazon.com/Seagate-Enterprise-Capacity-...
    Reply
  • DanNeely - Thursday, May 12, 2016 - link

    External drives are the cheap low RRM, low duty cycle models. Helium has only be used in the eye searingly expensive enterprise drives. Reply
  • takeshi7 - Thursday, May 12, 2016 - link

    You can get an 8TB non-SMR air based desktop drive and put it in an external enclosure, but honestly I'd save my money and just get the SMR drive. SMR isn't that bad for writing large sequential files, like videos, and reads are just as fast as a normal drive. Unless you're doing something really demanding SMR is fine, and if you are doing something demanding you'd be better off with some sort of expensive RAID setup, anyways. Reply
  • Lolimaster - Friday, May 13, 2016 - link

    I would stick to at most a WD Blue 6TB until HARM finally arrives.

    15-20TB disks.
    Reply
  • JimmiG - Friday, May 13, 2016 - link

    SMR is almost a perfect match for the kind of massive media library or backups that you might use an HDD for these days. Unless you're modifying/overwriting data, the firmware will ensure that the data is written to "pristine" tracks. Even when you do modify data, there's the non-SMR buffer. There's the issue with RAID, but most RAID modes are a bad idea with >2TB drives anyway.

    90 million units is hardly a "niche" market, and HDDs will remain for many years to come. There's just no other option if you need to store more than a terabyte or two of data, especially when you don't actually need the superior performance of the SSD (such as media libraries and backups).
    Reply
  • Wolfpup - Thursday, July 14, 2016 - link

    I'm just nervous about reliability with those SMR drives. Maybe I'm concerned for no reason, but I feel like storage tech is fragile enough as it is.

    The SMR externals were like $220 or so for a Seagate, versus $350 for a "normal" drive (and then I had to buy an enclose). So far so good though, using them for a few months.
    Reply
  • Wolfpup - Thursday, July 14, 2016 - link

    Wowzers, 10TB? I didn't know that... I just bought 8TB Seagate NAS drives a few months ago. Almost double the price of the SMR drives, but I'm just nervous about those. Reply
  • Wolfpup - Thursday, July 14, 2016 - link

    Segate JUST released 8TB internal drives. I bought an enclosure that can hold 4 drives, + 2 8TB drives. They're...umm...I guess they're considered NAS drives. They were like $350 a piece though, something like that, but I need every scrap of space I can get, and I didn't really trust that new SMR tech. Reply
  • NeatOman - Thursday, May 12, 2016 - link

    I try to never use a mechanical HDD when ever i can, and now that SSD's are $60 for 250GB and come with 3 or 5 year warranties its perfect. Most people will never fill a 250GB drive with just pictures and music. But i still recommend using a HDD as a backup and only using while backing up. Reply

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