Storage is such a dirty word in Silicon Valley. Everyone looks down on the disk drive makers with such scorn, and derision. Disk drive makers have such a thankless job – double the disk drive capacity in nine months, i.e. at a pace that is twice as fast as Moore’s Law. And they have to do it for meager profits. They sell so much and yet they make so little (or nothing) in profits. Take Western Digital as an example – it brought in $3.05 billion in sales but a mere $151 million in net income for fiscal 2004. Fo fiscal 2005, the company will sell $3.61 billion but profits are not going to be that spectacular. Seagate and Maxtor are faring no better. The constant fear of a price war doesn’t help matters either.
These negatives mask the fact that without disk drive makers and their own twist of Moore’s Law, all the bandwidth, processing oomph and clever ideas will amount to nothing. If there were no $50 dollar drives, Tivo cannot sell a $99-box. Without cheap drives, iPods would cost more than a week’s salary. And I for one would not be able to afford a terabyte home. What really got me thinking about this was Lee Gomes’ excellent column in Wall Street Journal about perpendicular storage, something I had written about last year as part of Business 2.0′s cover story, Seven Technologies That Change Everything.
I think one of things we tend to overlook when it comes to broadband or convergence is the role of storage. If there were no cheap drives to store those mp3 files, companies like Mercora just won’t be possible. Napster may have supercharged the demand for broadband, but it was storage that made it possible to share all that music. Similarly, BitTorrent might be a fantastic was to distribute digital content, but without storage, it really doesn’t amount to any thing. Maybe folks time to stop treating storage as the Rodney Dangerfield of technology!