Solid Move

It is always fun to see a market tipping point at the moment it occurs.

Samsung, the Korean tech titan, is rumored to be exiting the hard drive business for ultra thin notebooks, switching instead to solid state drive (SDD) production. It appears that Hitachi, Fujitsu, Seagate and Western Digital have abandoned that market as well, leaving Toshiba alone to peddle electricity sucking spindles for your groin warmer.

When five out of six primary players leave a market, you know that market is toast.

Intel is accelerating the switch. They report that as soon as next month they will double the density of their SSDs, pumping in a hefty 160GB into the small form factor. Since SSDs are a relatively new market phenomenon, and since work has only begun on how to bundle more bits into the drives, we can expect Moore’s law to switch from CPU cycles to SSD saturation.

Amazingly, this is occurring without a single dollar of Federal stimulus money.

Markets change and technology markets change fast enough to make blinking a hazard. Given the inherent advantages to SSDs for laptop users, and the gurgling price/capacity wars, we can expect most new business laptops to come with SSDs within a year or two, and most new consumer laptops soon thereafter.

With markets changing at that speed, marketers have an added headache, namely calling the point for abandoning old technology. It is never easy to decide when to abandon a market or strategy, but it is part of the CMOs role. In the technology business it takes gamblers’ nerves. Exit too soon and you leave behind a viable cash stream. Switch too late and you are on the bottom of the compost heap in terms of market share and revenues.

The primary indicator to making this decision is when a new solution set presents customers with one or more benefits while eliminating former deficits. Laptops now outsell desktops and that gap will widen rapidly. When laptops were twice the price (or half the performance) of desktops, only road warriors and people who enjoyed typing with pencil erasers would own one. When the price/performance gap between laptops and desktops became more or less none, buyers started switching. The new benefit (having your computing power wherever you went) was important and the old deficit (high price or low performance) went away.

Sure, this sounds basic, but how many CMOs include this criterion on their monthly product line review check list? Fewer than presidential cabinet members with tax problems (well, that’s unfair … there are way too many of the latter).

SSDs are now following laptops, figuratively and literally. The new benefits are significant — less battery drain, less fragile, more reliable and cooler on your private parts. The only deficits — price and capacity — are falling fast. Thus we are at the edge of a market demand shift.

Now, if Intel or Samsung would thank me for pointing out their advanced thinking by sending me an SSD for my HP 6530b laptop …


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