Seagate CEO Comments on Solid State Drives, Potential Lawsuit

SeagateIn an interesting article over at Fortune Magazine, the CEO of Seagate, Bill Watkins, had some interesting comments about Solid State Drives (SSDs), Seagate, Western Digital, Intel and laptops like Apple’s MacBook Air:

But the key thing, Watkins argues, is that SSDs are just too expensive, and will be for a long time. Just look at the MacBook Air. There are two versions of the Apple laptop, one with an 80 GB hard drive for $1,800, and one with a 64 GB SSD for $3,100. Why pay so much more for less storage? It’s not a difficult choice.

“Realistically, I just don’t see the flash notebook sell,” Watkins says. “We just don’t see the proposition.”

But in case flash prices continue to plummet and the flash drives really do catch on, Watkins has something else up his sleeve. He’s convinced, he confides, that SSD makers like Samsung and Intel (INTC) are violating Seagate’s patents. (An Intel spokeswoman says the company doesn’t comment on speculation.) Seagate and Western Digital (WDC), two of the major hard drive makers, have patents that deal with many of the ways a storage device communicates with a computer, Watkins says. It stands to reason that sooner or later, Seagate will sue – particularly if it looks like SSDs could become a real threat.

Watkins might want to keep his lawyers on speed dial. The price of flash has been dropping so fast that it’s surprising even the pros. Intel CEO Paul Otellini had to promise investors earlier this month that he wouldn’t let the losses from Intel’s flash businesses sink the whole company’s profits, after flash prices greeted 2008 by dropping almost twice as fast as the company expected, leaving Intel saddled with a lot of devalued inventory.

I have no idea about their patents, etc., but hopefully it won’t come to a lawsuit. I don’t understand how he doesn’t see the benefits inherent in flash drives either, unless he’s only looking at it from the perspective of a CEO.

Full article at Fortune/CNN Money

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