DVD Burning Bits.com - DVD Insider #29

mall Storage Gets Big
Tiny Hard Drives
Sexy Flash
20 cent DVDR = $20 Rolex

Never put multiple agenda storage people in the same room and ask them who is
best!

IDEMA (International Disk Drive Equipment and Materials Association) did it recently
to help CE/PC and storage folks understand each other's issues, needs and agendas.
The very focused event helped them all get their arms around where things were
going for video, audio, photo and darn near every other application.

Guess what?

There's so much data and so much content flying around that people want to grab
and store. It's all good!

Organizations and people producing content like they were rabbits. We're giving
it to everyone. We're keeping everything. The consensus was HDs in all shapes
and sizes will continue to proliferate. The hot segments are the cute new itty-bitty
1-inch drives and flash drives/cards.

Big drives - 5.25, 3.5 and 2.5-inch units -- will pop out in huge volumes as
will CD/DVD products. However, profits will be measured in pennies, not dollars.

The Holy Grail for folks isn't enterprise, desktop or notebook storage. Everyone
seems to agree the volumes and profits will be in the sexy CE products(Figure
1). Things we can't live without (Figure 2) like cam/cellphones; portable, home
and auto audio devices; digital cameras/camcorders and products that are still
in the labs are increasingly storage intensive.

In every application the device size is shrinking, capacity/performance are increasing,
prices are dropping and innovation/implementation demand is growing because people
"need" more and more of their content with them�all the time.

30,000 Ft View
Take a look at a few of the applications we readily identify with today and their
storage needs now and in the future:

2004 2008
File Size Flash Hard Drive Flash HD
MP3 Song 1.5MB 5 hrs 1,439 hrs 35 hrs 11,429 hrs
Photo 1.03MB 139 phtos 38,835 470 154,826
MPEG-2 Film 2,025MB 0.1 hrs 30 hrs 0.7 hrs 237 hrs
MPEG-4 Film 260MB 0.8 hrs 231 hrs 5.6 hrs 1,852 hrs

Average Capacity 143MB 40GB 972MB 320GB

The above are the "simple" and rather obvious applications. But they are only
the tip of the proverbial iceberg. Professionals, students and just about everyone
wants to have his or her content, wants to management him/herself and wants to
use and view it on his or her own terms.

Just look at the directory on your notebook. Huge email directory and files.
Business documents, data and research. Video and PowerPoint presentations.
News and information you know you are going to need. Photos, personal videos,
movies, DivX stuff, TV shows you missed. Then there are the CDs/DVDs you have
and USB drives in your backpack with really private stuff.

IDC notes that the world's data and content doubles every 12-18 months. That
growth is faster than Moore's Law. To process all of that information Intel
and AMD are in a battle royale to delivering 64-bit multi-core microprocessors.
It's little wonder that storage folks focus on developing bigger and faster capacities.

For storage there are no simple answers. Each side (HD and flash) sees their
glass as half full and the other guys as half empty. Each sees the beauty of
their solution and the warts of the other.

Flash has volume and mass on their side as well as low power consumption and
shock resistance. Hard drives have total capacity, low cost per GB, read/write
speeds and unlimited overwrite. Flash's lowest price point will stay lower than
hard drives. Hard drive's capacities will always be higher and seem to increase
faster than Flash's. Prices in both technologies are decreasing rapidly as we
put more and more content on individual devices.

So some applications will simply straddle the fence. One time HDs will win.
Other times flash will win. Each will scream they won!!!

Small Spinning Discs
We weren't in the industry when Al Shugart and others unveiled the hard drive
(first dubbed RAMAC and later given the hard-driving name Winchester) at IBM
in the '50s. Jim Porter, who headed DiskTrends for years and is writing a book
on the industry, tells us it had a diameter of 24 inches and stored a whopping
2,000 bits per square inch.

We recall our first 5.25-in HD that stored an amazing 10MB and we wondered how
we'd ever fill the noisy thing. We saw our first 3.5-in drive and thought it
was just cute as hell. We just saw Hitachi's and Toshiba's new 1-in and .85-in
drives with 6 and 8 GB capacities and were blown away.

The areal density has increased 10,000% over the past 20 years and today we have
densities that store more than 100 billion bits on a square inch.

Seagate, WD (Western Digital), Samsung, Hitachi and the other spinning platter
people see a world of great applications for their products over the next three
years (Figure 3). IDC projects healthy volumes for HDs in a wide array of applications
including cell/cam/all purpose phones.

What HD people don't like to talk about is drive failures. Yes the MTBF is better
than the old metal oxide days and they are steadily improving. Server and desktop
drives are very good today but remember companies don't install RAID just because
they love to have more platters spinning. For mobile devices (because people
are clumsy, careless and "know" our data will be there) the MTBF is cut � to
1/3.

MTBF is always a cool number based on a really complicated mathematical formula
we could never follow. But the numbers sound good to the consumer. At IDEMA
they emphasized the famous "bathtub curve" (Figure 5) on failures.

The bottom line is there are two stages to a HD - getting ready to fail and dead!

With more family moments, super music, great ideas and answers to the world problems
sitting on these drives it is still hard to get people to back-up and archive
their data to (yes here it comes) CD/DVD discs. Only people we know who do
it are those who have suffered the heartbreak of data loss!!!

Flashy Flash
Yes the tiny HDs like Verbatim's Store 'n' Go HD are cute with great storage
capacities - 4GB and next 6GB, 8GB and who knows. But people are becoming addicted
to flash - cards and USB drives.

After all they are more shock-resistant, very heat tolerant, ultra small, aren't
affected by external fields and require almost no power. The cards let you feel
like a big Las Vegas player. The USB drives are rapidly becoming fashion statements.
Manufacturers like Verbatim are shipping units with super read/write speeds
that will only get better and complex security protection that will also steadily
improve.

Demand growth in the key areas - audio players, cameras and phones - looks very
inviting to these chip producers (Figure 6). Flash slots are being designed
into car radios and navigation systems. Home entertainment systems and SOHO
printers will have them. Then add video storage, games and really personal personal
storage and the numbers shoot through the roof.

We've seen post production people in music and movie facilities (yes the DRM
people) download their work from one station and throw the 1 and 2GB drives to
someone down the way to use. An acquaintance at Adobe says each of his kids
have three hanging on their backpacks. One for school work they carry back and
forth, one for music/photos and one for stuff he feels it is better he doesn't
know about. At the New York Times we met with a reporter who had his as a necklace
and we see that increasingly with people in all walks of life/business.

A chicken in every pot, two cars in every garage and 4-5 USB drives for every
person�that's what drives the world's economy!

CD, DVD Gotchas
People love bargains.

Our wife loves to tell us how much she saved at Nordy's, Bloomies and Macy's.
Ok those may be legitimate.

But a spindle of CDs for $5 or spindle of DVDRs for $15 at Fry's, Best Buy or
on-line? We know the BOM (bill of materials), manufacturing costs, shipping
expenses and don't forget all of those royalty payments. And that is before
anyone makes one cent in profit!

It reminds us of once on Times Square when we bought two "Rolex" watches for
$20 each for our brother-in-law who plays a decent game of golf. He's good but
no Tiger Woods. We gave them to him and said when he had a really bad shot he
could rip off his Rolex in a fit of rage and heave it into the pond. He did
it once and his playing partners were aghast.

He knew it was a fake.

But there is a lot of unbranded and tier two/three bargain basement media that
isn't worth getting�at any cost. Quality varies all over the map. If it can
be written without producing a coaster it often may not be playable in certain
DVD players, game consoles or ROM drives. Or, the data can disappear in a few
days, weeks or months (usually right after it has been eliminated from the hard
drive).

The bargain producers usually "borrow" the media identifier code (the information
the burner/player needs to recognize the media and access the contents) and punch
out their discs. They pass it along to the people who relabel/sell this stuff.

The folks at CDRLabs.com, CD-Info.com, Anandtech, Tom's, CDFreaks.com and other
dedicated sites have long known and tracked these issues for their readers --

'

It may cost a little more than the $15 spindle but there is high quality, reasonably
priced media available. Firms like Verbatim, Mitsubishi Kagaku and a few others
regularly deliver media content developers depend on and regular/casual users
can count on.

The discs may cost a little more initially but if you spend hours or days/weeks
developing superb video content or developing the perfect audio mix why would
you "save" on the media that is going to hold this valuable work? What about
totally irreplaceable family photos and videos? Your personal records or tax
returns? And unless you were an executive at Enron, Adelphi or MCI email and
financial transaction archives would seem to be pretty important!

Our brother-in-law knew the real value of his Rolexes because no one really tried
to hide the fact and the prices reflected the quality. For the bargain CD/DVD
media buyers we agree with Forrest Gump�"Stupid is as stupid does."