History 2001: NEC Stops Making HDDs for IBM

NEC has invested considerably in HDD production, although it’s never been a major player in the field.

In 1988, the company began with 5.25-inch units, then began several lines of 3.5-inch and 1.8- inch lines with help from partners for the design.

In 1997, the company signed a technology agreement with IBM to manufacture 3.5-inch desktop HODs under license.

At the time, NEC expected to have a 5 million unit-per-year production capacity by the end of 1998.

A similar accord was then passed between the 2 firms for Magstar 3570 tape drives.

Now, NEC has decided to throw in the towel, opting not to renew its agreements with IBM, which expire next month.

As a result, it will close down NEC Computer Storage Philippines, its plant in Binan, near Manila, which produced 3.5-inch desktop HDDs for IBM. All of the current 1,400 employees will be laid off.

This article is an abstract of news published on issue 166 on November 2001 from the former paper version of Computer Data Storage Newsletter.