By Scott M. Fulton, III, Betanews
The typical PC hardware introduction is targeted first at the high end of the product's respective market, often referred to as the "enthusiast" or "early adopter." This is the person expected to have more disposable income, willing to pay a premium to be first on the block, and the person I'm most often told by company representatives fits the description "Betanews reader."
But the recent trend that has breathed new energy into the hard disk drive industry -- energy it desperately needed during the worst days of the bad economy -- has to do with consumption, and it affects more than just the high end of the market. Everyday PC users are finding themselves more comfortable with larger hard drives, so much so that average street prices for 1.5 TB HDDs are now approaching $125. It's the mainstream that's driving prices lower, but that's also purchasing more drives especially now that external HDDs -- once considered dead just a few years ago -- have exploded into a commodity market. Now that consumers can simply plug them in and go, they're as ubiquitous as printers.
This actually poses a problem for manufacturers like Seagate, which rely on a new product's ability to drive a premium price for at least a few months' time. This week, it's premiering its Barracuda XT line, its first 2 TB drive using the new 6 Gbps SATA interface. Priced at $299 suggested retail, it does carry a premium, but a very thin one.
"The capacity trends have definitely been mixing up," admitted Seagate product marketing director David Burks in an interview with Betanews. Burks was referring to his company's assessment that as much as 9% of sales of desktop hard drives have been for 1 TB capacities and above, compared to less than 2% the year before. "The technology is allowing that, and people tend to buy the bigger stuff as it comes along. But part of it is definitely the fact that the applications that are using this capacity are hitting the mainstream, and users are actually filling up a lot of this data."
Consumer video editing software may be to credit for this trend, far more than games. It's a mainstream element of the market where users may be generating far more input -- videos streamed in from DVDs, downloads, and old video tapes -- than output.
Meanwhile, the enthusiast side of the market is actually not only more skeptical, but more conservative. For performance purposes, enthusiasts continue to use smaller HDDs as their main system drives ("smaller" in this case meaning 80 - 100 GB, which is almost as small as you can buy these days), while using high-capacity drives for storing data such as videos and other media. For that purpose, enthusiasts actually may not require the highest speed available, which for Seagate and SATA interfaces is now 6 Gbps. In fact, not only have many shared the fact that they haven't seen their systems max out the 3 Gbps SATA already in use, but they recall the times when SATA bandwidth expanded to 1.5 Gbps, in such a way that actually created data retrieval bottlenecks for operating systems that weren't expecting it.
Windows Vista, just off its delayed launch, was one victim of the bottleneck. MacBook Pro may have been another, as many customers found out the hard way.
So Seagate's marketing push has to be a very careful one, especially if it wants to fully monetize its opportunity here: It's targeting the Barracuda XT toward a buyer who will buy into the hope that 6 Gbps will immediately demonstrate double the transfer speed.
"We are trying to listen to who our customers are, and respond to their unique attributes," said Burks. "For example, the games crowd is definitely going to be interested in kicking the tires on this drive. And that crowd happens to be very tech-savvy, they're comfortable with upgrading their own systems often, with tweaking and tuning...We've noticed that some of those guys are using a utility program that Seagate offers for free download, called SeaTools. They're deploying a technique called 'short stroking,' which is essentially restricting the access on the media to the outer diameter where the performance is fastest, so they get a faster performing drive through the technique. They sacrifice some capacity, but in doing so -- especially depending on the alternatives in the marketplace -- they might be able to buy an XT drive and get a much better cost-per-gigabyte solution, and get the top performance out of that, relative to the alternatives, by using this technique."
In other words, Seagate is actually willing to play down the capacity angle, for the benefit of customers at the high end who aren't impressed by capacity anyway, and who may not even need it. What they care about is performance, so inspired by Asus and Gigabyte -- two motherboard manufacturers that were the first out of the gate to support Barracuda XT -- Seagate is touting its customization tools, and billing the "short stroking" feature as the storage counterpart to overclocking. Then it's billing the fact that the XT drives have four platters compared to the two platters in its 1 TB drives. There was a time when fewer platters were better; but with short stroking, you actually want more perimeter surface.
It's a bit like having a four-layer birthday cake instead of a two-layer one -- you get more frosting that way.
Then later on down the road as the XT's features become more mainstream (several weeks away, at least), its native form factor and specifications will be a better fit for the high-capacity customer with a huge drive C, or an appetite for huge external storage.
But how will Seagate be able to make its case to a very skeptical initial customer base, who already sees through the company's campaign? Can Seagate's SeaTools work like Gigabyte's EasyTune, for example, giving the enthusiast the type of support and choices he craves for a drive that'll eventually become food for the mainstream?
"Up to now, we haven't been very good at that," admitted Seagate's David Burks, surprisingly, "but that's exactly what we're trying to step up and do better. We've seen people do this, we've got the wherewithal to make it a little easier, let's do that. So we're going to be publishing some instructional content that can say, if you're wanting to tune for performance, here are some different mechanisms you can do that with using SeaTools, and with other tools in the industry."
Seagate is also expanding its manufacturer's warranty for Barracuda XT from three years to five years, even though analysts now tend to believe that mainstream users don't hang on to their drives for longer than three years. Since the company predicts that streaming media applications will contribute to the "maxxing out" of the SATA 3.0 Gbps interface by the end of 2011, it's making the case that some Barracuda XTs may stay in service as the principal system disks of workhorse systems -- maybe not 2 TB, but certainly well-utilized -- up to five years after first being put into service.
It's a stretch, but a logical one, and a clever way to initially sell a high-end HDD into a market that may not require, or that may be skeptical of, its initial specs.
Copyright Betanews, Inc. 2009
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