Makers of storage drives may be taking it a tad bit too far

Feb 24, 2012 07:50 GMT  ·  By

The latest word from the hard drive market has come in, but it is not exactly encouraging, even though the consequences of the Thai floods have lessened.

It looks like hard disk drives are going to jump in price yet again, by about 30% to 40%, even though they already sell for about twice the money they demanded last year.

Granted, that isn't exactly accurate: the report on Digitimes says that the prices are going to be 30-40% higher compared to pre-flood levels, not the already inflated ones of today.

Reading between the lines paints a rather unfortunate picture though.

Just a few days after the flood's consequences became clear, HDD were said to have become 10% more expensive, when in fact the real increase was of 100% or even more, according to the prices we saw online.

The situation is not much different now: where 2TB HDDs, for example, sold for around $85 or less last year (63.58 Euro), they now have prices of around $180 / 135 Euro.

Things are made all the more awkward by the fact that hard disk supply actually recovered faster than anyone had expected.

Global volumes of HDDs are already back at almost 80% of the pre-flood capacity, so companies and stores shouldn't really be able to use shortages as an excuse for this ridiculous price inflation anymore.

Granted, the report says the cause of the high price threshold is a hike in prices of raw materials, but we cannot help but wonder how long this excuse will last.

Component costs don't just jump overnight, so even if the 30-40% will be the effective price premium, we don't see how it is justified.

Even adding labor costs and raw materials to the equation, we cannot help but be a little curious.

At least the 80% of global supply should be restored by the end of this quarter (January-March, 2012). Production will be of 140-145 million units overall.