TOM COUGHLIN Tom...Coughlin Associates 1665 Willowmont Ave. San Jose, CA 95124 Phone/Fax: (408) 978 8184 Email: [email protected] Tom’s 20+ years of magnetic recording experience

Copyright 2004, Coughlin Associates

TOM COUGHLINPresidentCoughlin Associates1665 Willowmont Ave.San Jose, CA 95124Phone/Fax: (408) 978 8184Email: [email protected]

Tom’s 20+ years of magnetic recording experience included flexible tape and floppy as well as rigid disk recording at such companies as Polaroid, Seagate Technology, Maxtor, Micropolis, Nashua Computer Products,Ampex and SyQuest. Since 1997 Tom has worked with Dennis Waid at Peripheral Research Corporation co-writing several of the annual PRC reports. He has published over 40 articles, reports, technical papers and presentations. Tom has provided marketing, intellectual property and technology assessments and projections for several data storage technologies companies and venture capitalists. In addition he has served as project and general manager for significant technical projects.


A Drive For All Seasons

Thomas M. CoughlinCoughlin Associates


Outline• Continuous growth in HDD areal density are

expected and drive unit growth is increasing.• The creation, editing, archiving and distribution of

digital content is an enormous driver for digital storage growth.

• The consumer value chain creates the means for reception of digital content and itself drives digital storage needs.

• Hard Disk Drives but also other storage technologies in the digital memory hierarchy play an important role in creating new digital content applications.


The Continuum of Recorded Human Experience

Cave Paintings Cuniform Tablets Gutenberg Printing

RAMAC and Recording TapePVPs and Modern

RAID Arrays

FUTUREPersonal Life

Journalsand Advanced

Intelligent Storage Networks


2000: Titanic Technology, Sinking Margins

SS Areal Density

Investors

Key EmployeesComponent Suppliers


AREAL DENSITY PROGRESSION / 2000-2003 TECHNOLOGY DEMONSTRATIONS / PRODUCTS

(GIGABITS / SQUARE INCH)

020406080

100120140160180

Are

al D

ensi

ty (G

b/in

Q1

2000

Q2

2000

Q3

2000

Q4

2000

Q1

2001

Q2

2001

Q3

2001

Q4

2001

Q1

2002

Q2

2002

Q3

2002

Q4

2002

Q1

2003

Q2

2003

Q3

2003

Q4

2003

TECHNOLOGY PRODUCT


SHIPPING PRODUCT DISK CAPACITY PROJECTIONS

Year 95mm Mainstream Capacity Per Platter2002 402003 802004 1202005 1802006 270


What this Means For HDDs

320 GB95 mm, 4-disks

2003320 GB

65 mm, 2-disks2006-2007

320 GB48 mm, 2-disks

2008+


Market Niche Projections

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

500,000

Uni

ts in

thou

sand

2001 2002 2003 2004 2005 2006 2007 2008

MobileCEDesktopEnterprise ATAEnterprise


Digital Content Value Chain

Content Distribution

Content Reception

Content Creation

Content Editing

Content Archiving

•PVR/DVR/set-tops•Game Machines•Mobile Devices

•Streaming Media•VOD•PPV

•Tape•ATA Disk Arrays

•Optical Jukeboxes

•Field Editing•Studio Editing•Special Effects

•Cameras•Animation


Drivers for Greater Entertainment Storage Requirements

• Red laser optical disks Blue laser optical disks• Current HDD capacities Higher HDD capacities• Current Flash capacities Higher Flash capacities• Current storage component costs Lower storage component costs• Current HDD sizes Proliferation of smaller drive formats• PC disk drives in PVR/DVRs Specialized AV drives in PVR/DVRs

SCSI/Fibre Channel Storage Lower cost SATA Storage for Fixed Content storage and SAS and Fibre Channel for higher performance storage

• CD/DVD Purchases Content downloads and storage• Struggle between content owners and users Workable business models for

reasonable content prices and usage• Isolated CE equipment Networked Homes and Home Media Servers using

standardized interfaces and commands• Mostly isolated computers Pervasive wired and wireless computer networks• Today's MP3 players and PDAs Advanced mobile music and personal video players

and integrated PDA/phones• Decaying analog media in hard to access vaults Digitized historical content readily

available on networks


Drivers for Increased Content Richness

• Analog TV Digital TV• Standard Definition TV High Definition TV• 2k Film Production 4k Film Production• Film Cameras Digital Cameras• Film Projection Digital Projection• 32-bit Processors 64-bit Processors• Dial-up Connections Broadband

Connections


Digital Content Distribution Chain, from Scott Kipp’s book “Broadband Entertainment.”

From Scott Kipp’s upcoming book on Broadband Entertainment


Content Creation, Distribution, & Archive Market (SCSI/FC HDD, ATA HDD, & Tape)

0

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

14,000,000

TB S

hipp

edArchiving Historical Content (Tape, TBs)

Distribution & Projection (ATA, TBs)

Archiving (Tape, TBs)

Editing (SCSI & FC HDD's, TBs)

Capture & Conversion (SCSI & FC HDD's, TBs)

Archiving Historical Content (Tape, TBs) 4,530.0 13,900.0 56,600.0 230,000.0 937,000.0 3,820,000.0

Distribution & Projection (ATA, TBs) 1,420.0 4,360.0 17,800.0 72,300.0 294,000.0 1,200,000.0

Archiving (Tape, TBs) 9,060.0 27,800.0 113,000.0 461,000.0 1,870,000.0 7,630,000.0

Editing (SCSI & FC HDD's, TBs) 390.0 1,200.0 4,870.0 19,800.0 80,700.0 328,000.0

Capture & Conversion (SCSI & FC HDD's, TBs) 51.2 157.0 639.0 2,600.0 10,600.0 43,100.0

2003 2004 2005 2006 2007 2008


Uncompressed Video Production Storage Needs (Raw DPX 10 bit log files).

Resolution Frames/sec MB/second Capacity/minute (GB)

SD 1.7 38.4 2.3

1K 3.2 76.8 4.6

HD 8.2 197 11.8

2K 12.5 300 18.0

4K 50 1.2 72.0


Digital Content Lifecycle in Production and Distribution.

Content Stage

Frequent Changes

Frequent Accesses to Fixed Content

In-Frequent Accesses to Fixed Content

Production Non-linear editing

Production Viewing

Archiving

Distribution N/A Distribution Viewing,

PVR/DVR

DVDs, VHS, Content

Downloads

On-lineSSD

High Perf. Disk Array

In-lineCapacity Disk Array

Near-lineCapacity Disk Array

Tape

ArchiveTape

Optical Jukebox

WORM

On-lineSSD

High Perf. Disk Array

In-lineCapacity Disk Array

Near-lineCapacity Disk Array

Tape

ArchiveTape

Optical Jukebox

WORM


Comparison of Tape and ATA Disk Storage Economics

0.01

0.1

1

10

100

1000

1996 1998 2000 2002 2004 2006

$/G

B

Tape Drive + 100 Media IDE Drive Ghetto RAID

Tape Drives

Tape Media

Ghetto RAID

IDE Drives

Tape Drive + 100 Media

Sony SAIT Projection


Examples of ATA-based Storage Systems

Quantum DX30The DX30 separates backup functions from archive functions to optimize the data protection process.

STK Bladestore product uses 3.5 inch drives on blade acting as one drive to a fibre channel output

Isilon IQ 3-Node 4.3 TB

Nexsan ATABeast Nexsan's14 TB for 7 cents a MB

R200 now offers up to 96 TB


Professional Digital Camera

Sony Optical Camera


Value Chain for Consumer Electronic

Devices

Storage DeviceMfg's

CE Products

Retailers &Distributors

Service Providers

End-Users

Semi's & SWComponents


Storage Device Segmentation for Consumer Electronic Applications

CompactFlash

Flash

MemoryStick

Magnetic Hard Disk

< 1.0 Inch 1.0 Inch

Optical

CD/DVDReWritable Holographic

1.8 Inch 2.5 Inch

3.5 InchMemory

StickDuo

SmartMedia MultimediaCard

SDCard

xD PictureCard

SDExpansion

Card

MemoryStickPro

MemoryStick Duo

Pro

ExternalHDD

Blue LaserDVD


Unit Price by Form Factor(Single Surface)

$-

$50

$100

$150

$200

$250

2003 2004 2005 2006 2007

Est

. OE

M U

nit

Pri

c

OEM P ric e - S ing le S urfa c e 3.5" HD D



OEM P ric e - S ing le S urfa c e 1.0" "S t o ra geEle me nt" HDDOEM P ric e - S ing le S urfa c e 1.0" HD D

OEM P ric e - S tan dard C F Flas h Me mo ryUn it P ric e


Sample value chain markup and storage cost as % of BOM

Storage Unit Price is Large Percentage of Total BOM Cost

30% MarkupHardDisk CE Device

$50.00 $65.00

30% Markup

$91.13

Retailer

Distributor

Consumer

$84.50

30% Markup

$109.85

HDDValue

HDDValue

HDDValue

HDDValue

(1.30 X 1.30 X 1.30) = 220%

$199.99/220% = $90.90 BOM Cost

$50.00/$90.90 = HDD is 55% of BOM

MSRP $199.99


Total DVR Market

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

18.00

20.00

2003 2004 2005 2006 2007

Ann

ual U

nit S

hipm

ents

(Mill

ion DVD Recorder PVR's

Advanced STB PVR'sStandalone PVR's


Network PVR/DVR

Toshiba SD-H400

• ~$500

• 80 GB HDD

• DVD/DVD-R Player

• Built-in Tivo

• Home Media Upgrade allows USB connection to wired/wireless network

ReplayTV RTV4532

• ~$780

• no longer available

• 320 GB HDD

• Ethernet Connection


Network PVR/(DVD-R) Price and Capacity(1 GB ~ 1 hour SDTV)

0

100

200

300

400

500

600

2003 2004 2005 2006 2007 2008

Pric

e ($

)

0

100

200

300

400

500

600

Driv

e C

apac

ity (G

B)

PriceDrive Capacity


AVERAGE DESKTOP DRIVE PRICES VS. TIME (Sources: Disktrend 1999 and Coughlin Associates 2003)

35

55

75

95

115

135

155

175

195

215

1H95

2H95

1H96

2H96

1H97

2H97

1H98

2H98

1H99

2H99

1H00

2H00

1H01

2H01

1H02

2H02

1H03E

2H03E

1H04E

2H04E

1H05E

2H05E

1H06E

2H06E

Pric

e ($

)

Ave. Desktop Price

3 Month Moving Average


Mobile Storage Hierarchy

RAM/ROM

FlashMemory (removable/non-removable)

Micro or Pico HDDMass Storage (removable or embedded)

$0.25/MB

20 ns

$0.20/MB

60 ms

$0.03/MB

12 ms

Cost/Speed

Tiny Optical ROM/WORM(removable)

$0.04/MB

10 ms

Volatile Storage

Non-VolatileStorage

Capacity

Small Tape or FloppyMass Storage (removable)

$0.01/MB

120 sec


Disk Drives in Mobile Applications

• Disk drives going into more and more consumer applications– 1.8 inch, 1 inch and possibly 0.8 or 0.7 inch

drives in mobile devices such as MP3 players, PVP, cameras and mobile phones

– PVR/DVR market, maybe with DVD-R and networking set to take off


Comparison of Mobile Storage Devices

$65-10° to +65° C

350 G23 dB0.6 W1.5 GB27 mm SE

$120+5° to +55° C

200 G23 dB1.3 W10 GB48 mm HDD

$11-40° to +85° C

2000 GNA24 mW64 MBFlash

OEM Cost Thermal Characteristics (Operating Temp)

Shock Tolerance (Operating)

Acoustical Charisteristics

Power (Peak)

CapacityStorage Type


Medium Volume and Density

106

105

104

103

Vol

um

e (m

m3 )

C D , D VD ,B l ue Laser D VD

MediaAlone

Media inDrive/Socket

MicroDrive ®

Memory Cards

C D , D VD ,B l ue Laser D VD

MicroDrive ®MemoryCards Ideal

size

1

10- 1

10- 2

10- 3Den

sity

(M

B/m

m3 )

Blue Laser DVD

MediaAlone

Media inDrive/Socket

MicroDrive ®Memory

Cards

MicroDrive ®

MemoryCards

10- 4

10

CD

DVD

CD

Blue Laser DVD

Holographic

DVD

Holographici n convent i onal dr i ve

• Memory Card data based on 128MB card.• Memory Cards are: SD Memory Card, Compact Flash, SmartMedia, Memory Stick• MicroDrive® data based on 1GB drive.

MicroDrive® is a trademark of IBM.


Chart of Projections of HDD Form Factor Units vs. CE Applications.

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

2003 2004 2005 2006 2007

Uni

t Shi

pmen

ts (M

illio

n

</= 1.0 Inch1.8 Inch2.5 Inch3.5 Inch


Form Factor Projections

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

500,000

Uni

ts (i

n th

ousa

nds)

2001 2002 2003 2004 2005 2006 2007 2008

1 inch1.8 inch2.5 inch3.5 inch


Conclusions• Rich media markets and CE are big drivers of storage growth• HDD areal density growth slowed and ASPs stabilized means

companies have time and money to develop HDDs tuned to niche application markets

• Drive unit growth is increasing but revenues will not increase at the same rate due to large number of price sensitive applications.

• Tape cartridge capacity grows and point of parity in $/GB for HDDs vs. tape is put off to the future

• We are likely to see multiple forms of digital storage in all segments of the content value chain driven by trade-offs between price and performance in the storage hierarchy.

• Drives moving to smaller form factors, especially in CE applications, although Dense Datacenter Storage may also drive smaller form factor drives.

• Disk drives for mobile applications are at a critical point since high capacity is needed but it must prove its robustness and overallreliability to the mobile marketplace. Could be a very big market—think cell phones


Time for the next wave of storage!

Documents

TOM COUGHLIN Tom...Coughlin Associates 1665 Willowmont Ave. San Jose, CA 95124 Phone/Fax: (408) 978 8184 Email: [email protected] Tom’s 20+ years of magnetic recording experience