Tablets and Smartphones – The End of HDDs?

Here is a white paper published by Seagate Technology LLC:

There may be no better illustration of today’s mobile lifestyle than the proliferation of content consumption devices, such as smartphones and media tablets. Consumers want constant access to their content on devices that are small, light, stylish and—often—as powerful as the relatively enormous personal computers they have at home or in the office. So what does this mean for the future of PCs? More specifically, what does it mean for the hard drive industry that has banked over US$200 billion in revenue this decade based largely on PC sales? Does this trend toward flash-based mobility mean the future of hard drives is obsolete?

The analyst community believes media tablets and smartphones are the two biggest trends in mobility and that the future for those products is certain. However, they’ll also tell you the PC market, and HDD storage specifically, is about to embark on the healthiest stretch of shipments in its history over the next three to four years. Is it possible for both to be true?

As table below illustrates, we are currently living in a world dominated by PCs and smartphones, with media tablets only now coming on the scene. As we move forward, Gartner expects 300 million media tablets will ship over the next three years combined. However, compare that to the 1.5 billion smartphones and 1.5 billion PCs that are also expected to ship over that span, and it becomes clear that media tablets will remain a fairly niche market and largely incremental to traditional devices like smartphones and PCs. In fact, according to Gartner, media tablets will cannibalize less than 10 percent of low-end consumer notebooks and will instead impact the mini-notebook market – a device that had been driving some incremental PC growth over the past few years. Gartner estimates that by 2012, 60 percent of the mini-notebook market will have been cannibalized by media tablets. Most analysts would agree that a healthy PC market translates to a healthy HDD market, based solely on economics.

                             Market for Compute Devices
                                   (PPP in U.S. Dollars)

(Chart created by Seagate, based on Gartner data)

Seagate views all of these devices as a net positive for HDD storage. The reason: Smartphones and tablets need to stream data, and a significant portion of that data will be consumer-generated content, mostly video.

According to Informa Research, referenced by GigaOM, today the average iPhone user consumes 196MB of data each month, and the average Android user consumes about 148MB per month. Over the next five years those figures will grow sevenfold, to the point that by 2014 there will be 3.6 exabytes of data a month on mobile networks8.

Clearly, the future for smartphones, media tablets, PCs and – that good old technology – hard drives is bright.