Hitachi Slashes Microdrive Prices

Hitachi Global Storage Technologies has begun shipping a new version of its 1-inch Microdrive hard drive that can hold 50 percent more data than the company's current highest capacity model, it says.

The 6GB version of the drive is notable not just for its higher capacity but also because it marks a shift in Hitachi's pricing for the diminutive drive family. The new drive will cost $299, which is a 40 percent reduction from the $499 price at which Hitachi has introduced new Microdrive products in the past, says Bill Healy, senior vice president of product strategy and marketing at Hitachi. The company is also lowering the price of its 4GB Microdrive to $199.

Customers who buy Hitachi's drive in bulk for use in their own products have been enjoying regular price cuts for sometime, says Healy. Hitachi's customers include Apple Computer, which uses the 4GB Microdrive in its IPod Mini music player. Earlier this week, Apple announced a 6GB version of the player.

Increased Competition

The higher capacity drive and lower prices will likely increase competition in the market for small-size hard drives. Hitachi competes against several companies, including Seagate Technologies, Cornice, and China's GS Magicstor. Fujitsu also said this week that it is also considering entering the market.

At present, these companies are largely chasing business from manufacturers of portable audio players, like the IPod. The market for such devices was estimated to be about 12 million units in 2004 and will be about 35 million in 2008, according to a December report from IDC.

"We're aiming for the music player market," says Healy. "We hope to bring [the Microdrive] to newer applications like cell phones in the [2006] timeframe."

The capacity increase in the new drive is possible because Hitachi is packing data more tightly on the disk's surface. The new drive's areal density, which is the standard measure for disk drives, is 78 gigabits of data per square inch versus 56.5 gigabits per square inch in the current 4GB drive, the company says.

At January's Consumer Electronics Show (CES) in Las Vegas, Hitachi announced plans to have an even higher capacity Microdrive out in the second half of this year. That drive will offer a capacity of between 8GB and 10GB and will also drop the Compact Flash interface for a ZIF (zero insertion force) connector of the type favored by consumer electronics makers.

Hitachi confirmed those plans remain on track with the launch of the 6GB drive, which it says fills a spot in the product line between the current 4GB model and higher capacity versions coming later this year.