PMR and Other New Technologies Drive Capital Spending, 120706 and Other … · 06/07/2012 ·...

Copyright 2006 Coughlin Associates

Perpendicular Magnetic Recording and Other New Technologies Drive Capital

Spending

Thomas CoughlinCoughlin Associates

www.tomcoughlin.com


Abstract• Perpendicular magnetic recording will completely

displace longitudinal recording in HDDs by 2009. Along with unit volume increases to meet demand for new and established applications manufacturing of PMR and other new technologies to meet areal density growth needs over the next few years will fuel industry capital spending that will exceed $20 B between 2005 and 2010. This presentation will describe the impact of the PMR conversion in terms of drive and component shipments and capital equipment spending. It will also discuss component and drive technology developments and the capital equipment that will be required to make them manufacturable.


Outline

• Industry Market Trends• Technology Projections• Capital Spending Trends• Conclusions


HDD Industry Market Trends


Banded Hard Drive Volume Projections (Annual Units)

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

1,000,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

High EstimateMedian EstimateLow Estimate


AVERAGE DRIVE PRICE TREND FOR SEAGATE, WESTERN DIGITAL AND

MAXTOR (Q4 ’98 to Q2 ’06)

0

20

40

60

80

100

120

140

160

180

Q498

Q199

Q299

Q399

Q499

Q100

Q200

Q300

Q400

Q101

Q201

Q301

Q401

Q102

Q202

Q302

Q402

Q103

Q203

Q303

Q403

Q104

Q204

Q304

Q404

Q105

Q205

Q305

Q405

Q106

Q206

Q306

HD

D A

SP ($

)

.


HDD Market Niche Projections

By 2010 CE and Mobile Computers will dominate in disk drive unit volume

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

Uni

ts in

thou

sand

s

.

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

MobileCEDesktopEnterprise ATAEnterprise


HDD Form Factor Projections

By 2010 2.5-inch and smaller HDD will provide over half of total disk drive volume

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

Uni

ts (i

n th

ousa

nds)

.

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

1.3 inch or less1.8 inch2.5 inch3.5 inch


Head Shipment Projections

2004 2005 2006 2007 2008 2009 2010

3.5 INCH 577,808 594,090 596,054 589,908 622,093 669,333 689,747

2.5 INCH 176,858 278,720 370,093 445,009 527,427 633,654 716,529

1.8> INCH 27,886 65,360 58,937 99,530 144,034 203,031 285,381

TOTALS 782,552 938,170 1,025,084 1,134,447 1,293,553 1,506,018 1,691,658


Disk Shipment Projections

2004 2005 2006 2007 2008 2009 2010

3.5 INCH 361,384 373,773 397,369 418,835 438,576 468,533 482,823

2.5 INCH 114,102 174,200 231,308 279,925 334,037 390,753 444,742

1.8> INCH 17,708 34,627 32,808 58,606 84,810 119,550 168,039

TOTALS 493,194 582,600 661,485 757,365 857,423 978,836 1,095,604


Market HGA Pricing Trends

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00MR HeadGMR HeadTMR HeadPMR Head

MR Head $5.50GMR Head $5.50 $5.25 $5.00 $4.75TMR Head $7.50 $7.00 $6.50 $6.00 $5.50 $5.00 $4.75PMR Head $8.50 $8.00 $7.00 $6.00 $5.50 $5.00

2004 2005 2006 2007 2008 2009 2010


Market Magnetic Disk Pricing Trends

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

$10.002.5' Glass Long.

2.5' Glass Perp.

3.5' Aluminum Long.

3.5' Aluminum Perp.

2.5' Glass Long. $6.75 $6.50 $6.30 $6.15 $5.95 $5.80 $5.602.5' Glass Perp. $9.50 $9.00 $8.50 $8.00 $7.50 $7.00 $6.503.5' AluminumLong.

$5.50 $5.40 $5.40 $5.30 $5.20 $5.10 $5.00

3.5' Aluminum Perp. $8.50 $8.00 $7.50 $7.00 $6.50 $6.00

2004 2005 2006 2007 2008 2009 2010


HDD Technology Projections


Observations regarding Technology Introductions

• Technology introductions occur erratically in a monotonically increasing fashion, driven by the pace of technical discovery as well as introductions timed for maximum advantage to the introducing company

• Once a technology is introduced it must go through a learning cycle until yield and performance issues are resolved and then follows a rapid adoption that displaces other technologies

• There may be more than one approach that creates at least a short term solution to a given technological problem


HDD Quarter by Quarter Public Technology Demonstrations and Product Announcements

0.00

50.00

100.00

150.00

200.00

250.00

300.00

350.00

400.00

450.00

Q1 200

0Q2 2

000

Q3 200

0Q4 2

000

Q1 200

1Q2 2

001

Q3 200

1Q4 2

001

Q1 200

2Q2 2

002

Q3 200

2Q4 2

002

Q1 200

3Q2 2

003

Q3 200

3Q4 2

003

Q1 200

4Q2 2

004

Q3 200

4Q4 2

004

Q1 200

5Q2 2

005

Q3 200

5Q4 2

005

Q1 200

6Q2 2

006

Q3 200

6

Quarter

Are

al D

ensi

ty (G

bpsi

)

HDD TechnologyHDD Product

About 2-2.5 year lag between laboratory and product

announcement


10

100

1000

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

Q1 2004

Q2 2004

Q3 2004

Q4 2004

Q1 2005

Q2 2005

Q3 2005

Q4 2005

Q1 2006

Q2 2006

Q3 2006

Gbi

ts p

er s

quar

e in

ch

HDD Product

20% CAGR

40% CAGR

60% CAGR

80% CAGR

100 % CAGR

Comparison of Product Announcement Trends vs. Areal Density Rates

There is no single CAGR. Growth rate of technology introductions varies with time


Comparison of Announcements to Highest Shipping Areal Density (2001-2005)

0.00

20.00

40.00

60.00

80.00

100.00

120.00

140.00

160.00

Q1 2001

Q2 2001

Q3 2001

Q4 2001

Q1 2002

Q2 2002

Q3 2002

Q4 2002

Q1 2003

Q2 2003

Q3 2003

Q4 2003

Q1 2004

Q2 2004

Q3 2004

Q4 2004

Q1 2005

Q2 2005

Q3 2005

Q4 2005

HDD Product

Highest Shipping AD(Gartner)


CAAGR• However one facet of

magnetic recording that appears to show steady growth is the growth of acronyms.

• Cumulative Annual Acronym Growth Rate (CAAGR) increases as short-hand for greater technology complexity

Acronyms

Time


Transition from LMR to PMR

Longitudinal Recording

Perpendicular Recording


Generations of PMR Announced Products

10.00

100.00

1,000.00

10,000.00

Q1 2000 Q1 2001 Q1 2002 Q1 2003 Q1 2004 Q1 2005 Q1 2006 Q1 2007 Q1 2008 Q1 2009 Q1 2010

Are

al D

ensi

ty in

Gbp

si

.

Gen. 4PMR

Gen. 3PMR

Gen. 2PMR

Gen. 1PMR

Longitudinal Recording (LMR)

50% Annual CAGR assumed after 2006


Definitions of PMR Generations• Generation 1: Initial product introductions by

Toshiba and then Seagate• Generation 2: Current product generation—

incremental improvements in PMR, greater use of TMR readers

• Generation 3: Further improvements including discrete track and/or dual-stage actuator

• Generation 4: TAR/HAMR or Patterned Media with more advanced read sensors, dual-stage actuators


2nd Generation PMR

Perpendicular Head Write Pole Formation

PMR Magnetic Medium

Tending to be TMR Heads with PMR


Generation 3 and 4 PMR• Generation 3 Technology Candidates:

– New PMR Media• exchange coupled composite media (ECC)• Exchange Spring Media (ESM) • Discrete track recording could also be used to increase TPI

– Head Technologies• Adjustable spacing heads• Secondary actuator heads (cost model must improve)• At least TMR, maybe CPP GMR?

• Generation 4 Technology Candidates:– By generation 4 some companies may be incorporating initial elements

of TAR/HAMR or some form of patterned media– Use of secondary actuators may be used to increase TPI if cost can be

reduced– Improved read sensors such as CPP GMR or even more sensitive

technologies– Improved encoding to recover signals with lower SNR


PMR vs. Form Factor

Year 2005 2006 2007 2008 2009 2010</=1.3 inch 0.1% 10.0% 60.0% 85.0% 100.0% 100.0%1.8 inch 1.0% 15.0% 50.0% 90.0% 100.0% 100.0%2.5 inch 2.0% 10.0% 30.0% 70.0% 90.0% 100.0%3.5 inch 0.0% 5.0% 20.0% 50.0% 80.0% 100.0%

Total 0.5% 7.0% 26.7% 62.0% 86.8% 100.0%


PMR vs. LMR Disk Drives (Millions)

0

200

400

600

800

1,000PerpendicularLongitudinal

Perpendicular 2 31 137 365 594 782

Longitudinal 378 414 375 224 90 0

2005 2006 2007 2008 2009 2010


PMR and LMR Heads (Millions)

0

500

1,000

1,500

2,000Perp. HeadsLong. Heads

Perp. Heads 6 77 314 834 1,552 1,742

Long. Heads 933 980 856 499 203 0

2005 2006 2007 2008 2009 2010


PMR and LMR Disks (Millions)

0

200

400

600

800

1,000

1,200Perp. DisksLong. Disks

Perp. Disks 4 49 205 545 1,008 1,128

Long. Disks 579 633 576 338 136 0

2005 2006 2007 2008 2009 2010


HDD Capital Spending Trends


2005 Capital Equipment Spending Breakdown

Total 2005 Capital Equipment Spending ~$2.2 B

Total Process73%

Total Prod. Test19%

Total Metrology

8%


2005 Capital Equipment Spending by Component Market Segment

Total Capital Equipment Spending ~$2.2 B

Media36%

Head39%

Drive25%


2005 HDD Company Capital Equipment Spending Estimates (Percentage of Whole)

(includes media/head capital equipment)

Seagate43%

HGST23%

WD14%

Maxtor10%

Toshiba4%

Fujitsu6%


Drivers for Capital Equipment Spending to 2010

• Annual drive volumes increasing ~2X by 2010 from 2005• Form factors ratio changes: 2.5-inch and smaller HDDs

to dominate by 2010• New HDD applications may require new manufacturing

capital equipment and process changes• Transition to perpendicular recording making much older

equipment obsolete• Lower flying heights and smaller bits increasing

metrology requirements, contamination control, as well as tightening of head and disk specifications

• By 2009 and 2010 to continue areal density increases the industry must introduce new technologies such as HAMR, discrete track media or fully patterned media


Capital Equipment Spending Estimates vs. Total Disk Drive Revenue

10.6%$5.68 B$53.6 B201010.1% (avg.)$23.65 B$239.9 BTotal (2006-

2010)

8.9%$2.87 B$32.4 B20069.9%$3.62 B$36.6 B2007

10.3%$4.29 B$41.5 B200810.4%$4.96 B$47.7 B2009

7.9%$2.23 B$28.1 B2005

Percentage Capital Equipment Spending/ Revenue

Total HDD Industry Capital Est. Equipment

Spending

Total HDD Company Est.

Revenue

Year


Capital Equipment Spending and Number of Drives Trends

3.50

4.00

4.50

5.00

5.50

6.00

6.50

7.00

7.50

8.00

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

Cap

ital/D

rive

0

100

200

300

400

500

600

700

800

900

Tota

l Driv

e N

umbe

r (M

)

Capital/Drive# Drives


Capital Equipment Spending Projection Summary

0

500

1000

1500

2000

2500

3000

3500

4000

4500

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Sale

s ($

M)

.

.

ProcessProd. TestMetrology


HDD Capital Equipment Spending Projections

0

1,000

2,000

3,000

4,000

5,000

6,000

Capital Equipment Spending

($M)

Drive 560 803 1,017 1,202 1,389 1,591

Head 875 1,093 1,385 1,636 1,891 2,166

Media 791 973 1,233 1,457 1,684 1,929

2005 2006 2007 2008 2009 2010


Conclusions

• Projecting 445 M HDDs in 2006• We project strong growth in HDDs through 2010 and a

significant increase in the percentage of HDDs that are used for CE and mobile computer applications as well as smaller form factors

• Areal density product growth is an irregular process • Areal density growth using perpendicular recording will

drive four generations of products by 2010.• All HDDs expected to use PMR by the end of 2009• Technology transitions will drive about $23 B capital

spending by the industry by 2010


Sources

• 2006 Hard Disk Drive Capital Equipment Market and Technology Report, Coughlin Associates

For more information go to the tech papers section of www.tomcoughlin.com


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PMR and Other New Technologies Drive Capital Spending, 120706 and Other … · 06/07/2012 ·...

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