A recent report in Storage Newsletter discussed the alarming percentage drop in HDD shipments in the second quarter of this year, with figures showing a continued 33% year-over-year decline in HDD shipments in the market. Analysts attribute the decline in numbers to a lack of sustained demand from customers, which may not be as surprising as it sounds.
Last quarter, shipments of hard disk drives through the consumer and enterprise markets accumulated only 45 million units. For comparison, hard drive shipments peaked at 651 million units in 2010, averaging 162 million units per quarter that year.
Hardware website Tom’s Hardware points out that the demand for HPC in the enterprise market has continued to grow, while cloud-based environments are inexpensive, consume minimal power, and bulky hard drives do not have an advantage over SSDs in terms of mentions. In addition, HDDs have become a backwater product as scientific advances and more necessary consumer demand for digital space dependency has evolved, and currently, HDD growth demand in the commercial market has almost stalled.
In recent reports, 2.5-inch HDDs have declined by forty percent over several quarters, accumulating shipments of only 11 million units. The decline in shipments is being described as a shift to “flash-based” storage options.
Consumer and desktop electronics came in second place, losing 30% between quarters, with only 17 million units shipped. Lack of demand for retail, personal computers, and even surveillance utilization was the main reason, with inflation of up to 8.6% being another. Presumably, the first two years of cryptocurrency Chia, the use of storage to mine cryptocurrency led to an increase in demand. However, whether this specific cause has had a significant impact in terms of the decline in the crypto goods market alone is merely speculation.
The price reduction of SSDs compared to HDDs has also led consumers and businesses to look at next-generation storage options, with wafer costs for QLC and TLC NAND decreasing by 13% last quarter and expected to decrease by 10% in the third quarter of 2022.
The report concludes that it is only a matter of time before HDDs are replaced by SSDs in the consumer and business markets before new, more powerful storage solutions emerge in the technology space.