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Hard Drive Prices Slide As Thai Flood Aftermath Subsides
New submitter yeszomgpony writes "For the first time since the Thailand flooding, hard drive prices are finally starting to decrease. The price jump was kicked off in October when drive inventory levels plummeted 90% in less than a week. From the article: 'Over the past few weeks, hard drive prices have leveled off and have begun to drop slowly, according to Dynamite's data. "For first time, less than week after Western Digital's first [fabrication plant] went back on line, drive inventory began increasing at both distributors and ecommerce sites, and index prices began coming down a little too," Kubicki said. IDC has predicted that hard disk drive supply shortages in the wake of Thailand flooding would affect consumers, computer system manufacturers and corporate IT shops into 2013.'"
Both are sliding
Somehow I doubt I'll be seeing this drop roll on down to myself and others anytime soon...
Sure seems like there's a shortage... I asked around whether anyone needed a few of my old ass hard drives on one of the local (German) hardware forums, and received a trade of a slightly castrated Core 2 Duo, 4 gigs of RAM and an ASUS mainboard for just a 500gig 3.5" SATA drive and an 80gigger notebook drive... both well used, of course. A few weeks ago, this wouldn't have been possible, with the hard drives worth pennies and the other hardware worth 40-50€.
Glad to hear the shortage is coming to an end though... I really need to upgrade my NAS. Last time I did that, 1TB drives were in the sweet spot... getting a bit full.
This often happens when a process goes off line for a time. It also normally works itself out after a few months.
I'll be waiting a few months myself.
hmmn seems conveniently timed to be more expensive while people are buying Christmas presents and they go back to regular pricing after the Xmas shopping rush, no there is no taking advantage disaster at all here to price gouge the consumer
---Saying gnome 3 is better than windows 8 not so much a compliment as it is damning with light praise.
Nice mouse hover text on the chart...
I think I'll wait a while until the processing hardware is working perfectly, the power is stable, the factory is fully purged of airborne particulates, etc. Until then I'll let someone else do the QC testing.
Wait wait wait... so you are telling me
Event...
Inflate fears based on event...
????
Profit
Holy shit... I could make billions! Quick, someone turn off a pipeline somewhere....
OK, fine - I'll call it a price hike instead of a shortage and we're good again ;)
Goes to prove yet again how the "free market", that weird beast so idolized by economists, is such a fickle creature. Cause after over several months underwater, there is NO way you are gonna get a clean room facility up to snuff & speed in a matter of days. Of course, now that the excuse is over, all the hoarding speculators are trembling in fear of getting stuck with their huge stockpile and will start to desperately flood the market.
The market will correct itself after the hype wears off consumer consciousness. Now they just are overpriced inventory like before speculation stimulated sales squeezed the flow down stream of actual flood effects. Take me to the River...
The WD20EARS seem to be back around $100.
And I'm sure that others physiologically have the same urge I do.
I've been putting off upgrading my ZFS pool long enough.
Goes to prove yet again how the "free market", that weird beast so idolized by economists, is such a fickle creature. Cause after over several months underwater, there is NO way you are gonna get a clean room facility up to snuff & speed in a matter of days. Of course, now that the excuse is over, all the hoarding speculators are trembling in fear of getting stuck with their huge stockpile and will start to desperately flood the market.
So in other words, the free market will function in exactly the way it's supposed to
Someone should do a article or investigation into all the obscure places our hardware comes from, especially concentrations where most of one type comes from a small area.
We only ever seem to hear about these places when something goes wrong.
Remember that time in the '90s when a Taiwanese RAM factory caught fire, and it turned out to be a big chunk of world RAM output? Sent prices spiking for a while.
Conversely, it's surprising how little the Japanese tsunami affected the tech world. I guess their industries were concentrated further south.
/. disks are getting full.
Slashdot, fix the reply notifications... You won't get away with it...
Ideally there would be no boom or bust. Those are caused because perfectly rational actors exist only in economic theory. Same for perfect information.
Ideally nothing. To suggest that the free market has an ideal or purpose or positive outcome short or long term is as foolish as to suggest that intelligent design underlies evolution and guides it benevolently.
The free market, for whatever necessarily restricted implementation of free market exists today, is a game which you win if you play well. Other people may benefit, or they may be unaffected, or they may have their enjoyment of life severely damaged. The only thing we can guarantee is that the winners usually tell everyone else that their win has been for everyone else's good too.
Great. We should get the government to control prices. I can't see how that could go wrong.
.. but hey, so long as hard drive prices are ok, then whats the problem?.
Really editors, get a fscking sense of perspective.
Ok.
This news reveals an important piece: The is no real redundancy in the suppliers when in comes to important parts of todays' devices. I often see* that the hard disk array suppliers keep buying them from a couple of asian outfits thinking they will be safe hands. But the asian hardware vendors themselves buy/order from the same manufacturer of platters/board/NAND creating a single point of failure scenario.
There should be a clear visibility of the supply chain of not just the end/whole product but also the key components of it. In another story, heard that shipping of Sonys' SEL50F18 lenses for NEX cameras are pushed to Mar'12 after users payed for it, for the same reason.
* working for a big storage co.
PS: Misread Flood as Food.
I wonder why Seagate chose to slash their warranty even though its plants weren't affected by the floods.
Exactly, a perspective. Let me explain what that means:
In this huge world with 7 billion people, every 3 minutes, about 600 die. (On average about 3 per second). And our population growth is so fast that the 600 dead had been replaced (sorry for the dry factual choice of words) before the floods even hit the news. ... But the harddrive problem affects the world, albeit in a modest way, for months.
So yeah, it seems the editors really do have a sense of perspective. Maybe you prefer a more emotional perspective... but if you want to mourn every couple of hundred people that die, you'd better empty your agenda. It's a full time job.
Riding round on horses terrorizing people?
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
Im very sorry if someone gets offended but I truly read the headline as: Hard Drive Prices Slide As Thai Food Aftermath Subsides
So in other words, the free market will function in exactly the way it's supposed to
No, the free market concept is suppost to regulate price by supply and demand, not by perceived supply and estimated demand.
The free market model also assumes the number of suppliers to be large. With the number of HDD producers being less than 20 supply can be tightly regulated and price is determined by demand only.
With the current trend of a few large companies controlling the market it is getting harder and harder to find markets where the free market model still applies.
But only for the oooh shiny crowd. I simply held off buying any hard drives. Would I have liked to expand capacity? yes. Would I have liked to buy 12 new machines? yes.
Did I kill people or lose money because I did not? no.
Honestly, the price jump was only because of idiots that rushed out and bought drives when they heard of a possible "shortage" and thus created a shortage.
Do not look at laser with remaining good eye.
Cause after over several months underwater, there is NO way you are gonna get a clean room facility up to snuff & speed in a matter of days.
Not days. Restoring the WD factory took about 6 weeks. It's still a bit spurious, I'll give you that.
Even perfectly rational actors cannot predict the future.
Cause after over several months underwater, there is NO way you are gonna get a clean room facility up to snuff & speed in a matter of days.
Were the actual plants flooded? Or was it a lack of power(impassable roads, etc.) due to the flooding that caused the shutdown?
From Wikiquote:
Since we're not sure it was spoken, I guess the pendulum swings back to tragedy.
Stalin would surely have continued: "Death of 30 million is prudence." What if it was you and your wife and your gf and your mother and your father? Hint: a day of morning is tragedy, a thousand years is history.
Manufacturers and retailers figured out price gouging wasn't working, people stopped buying. Now they know, and will be prepared to gouge us more subtly in the near future.
Oh wait, it's already begun: http://hardware.slashdot.org/story/11/12/19/1618254/hard-drive-makers-slash-warranties
And that's what it did. Initially, the demand curve didn't shift, but the supply took a huge hit. The price increase allowed the market to adjust, and eventually (quite quickly, apparently) subsided as capacity has been (partially at least) recovered (perhaps using existing capacity with reduced QC, as evidenced by the warranty cut...) and substitute products have been sought (some products may be forgoing HDs in favor of much smaller but still adequate SSDs, for instance).
This is exactly how the market is supposed to work. It's not supposed to be constantly at some steady-state "ideal" price. That's how planned economies work, and results in either or both of shortages and waste.
The only evidence of anything like market failure is the warranty cut, that cut across all manufacturers. One would've expected someone to hold out and become the "quality" producer. But even that is a stretch as the warranties were not cut across all product lines for all manufacturers.
Can you be Even More Awesome?!
One would assume that at least some plants were flooded, or their owners would not have gone through the expense of hiring dive teams to recover the equipment...
Can you be Even More Awesome?!
So - How can you stop boom and bust - the simplest way is to flood the market, and not let anyone know! Good luck with that strategy.
Alternatively, you can try lying a lot, and hoping no one notices (its called communism). Doesn't work very well in practice.
Sent from my ASR33 using ASCII
Bought a WD2002FAEX (Caviar Black, 2GB, 5 years warranty) for 126 EUR two months before the flooding happened. Tho weeks after the flooding the price went up to 199 EUR. Later on it inceased even more: 299 EUR (should have invested my money in harddrives instead of secure time deposites with low interest rates :-). Just checked a major retailer: 195 EUR.
BTW: Got some old SCSI 2 and 9 GBers. Might be a bargain :-)
This often happens when a process goes off line for a time. It also normally works itself out after a few months. I'll be waiting a few months myself. http://viboot.com/
From the article:
Data from DRAMeXchange also showed that rush orders for SSDs increased after the Thailand flooding disrupted hard disk drive supplies.
According to DRAMeXchange, a research division of TrendForce, rush orders for SSDs rose even as shipments of end-market products, including PCs, smartphones and tablet PCs, remained slugish because of slow economic conditions.
Despite SSDs not being an exact replacement for spinning rust, it looks like the HD shortage is indeed having the predicted effects on the SSD market.
What can I say, market is a price discovery mechanism and this truth still holds, even though so many in those previous stories disagreed because they completely miss the understanding of most basic economic principles.
Price discovery and profit are market principles that send signals to manufacturers to increase or decrease production, and the profit is the engine of progress - goods is what people want and are willing to trade their time (money) for them, thus the more profit one is making by supplying people with goods the more this indicates that the business is sound.
Of-course in a free market (free of government regulations), the absence of government regulations prevents possibility of a monopoly and thus the distribution becomes more and more efficient with prices falling and quality increasing.
You can't handle the truth.
>IDC has predicted that hard disk drive supply shortages in the wake of Thailand flooding would affect consumers, ....there was just as many drives for sale on the shelves at bestbuy as usual....where was the shortage....let it go for about 1 year, and let the shelves empty out, and people scramble to get all their old hdds dusted off, then maybe ill believe a shortage...this stinks of the same crap that the oil companies try pawning off on the economy when a small storm hits, and low and behold have to raise their prices by 12 cents because the factory was closed for 1 day...
Funny
need more coffee
"Game" is actually quite correct. You get props for not saying something really stupid, something like 'the study of the free market is a science, its actors always behaving in a mathematically definable manner".
Were the actual plants flooded? Or was it a lack of power(impassable roads, etc.) due to the flooding that caused the shutdown?
Based on the photo in this NYT article it certainly looks like the WD buildings themselves were flooded.
I know that WD announced the acquisition of Hitachi's HDD business back in March of this year. Has this been completed yet? Is Hitachi still using their own factories? Were those factories also in Thailand? The reason I'm wondering is because I'm concerned about quality on the new drives made from reclaimed flooded equipment – and the fact that both WD and Seagate are slashing warranties is definitely not a good sign. Hitachi has a reasonably good reputation and I've been using one of their 2TB drives for about six months with no issues (fingers crossed).
A million lemmings can't be wrong.
But they can be flat!
The cesspool just got a check and balance.
Honestly, the price jump was only because of idiots that rushed out and bought drives when they heard of a possible "shortage" and thus created a shortage.
Or you know, smart people who knew they had a need for certain drives for their home or business use through the next 6-8 months and realized they should fulfill their needs before retailers used the flood to hike prices.
Kinda like what happened in that (Taiwan I believe) earthquake in the 90s when RAM prices went through the roof.
Georgia Tech, the leader in Chia(tm) technology.
then fine move the facilities to North Korea where there are no works rights at all and they can be build just for the shipping + parts costs.
They can when the future is obvious to anyone with more than one functioning brain cell. People used to get burned as witches for this sort of thing. Now you just get dirty looks from your neighbors.
Jacked up prices castrate demand on a luxury good. Any group of Econ 101 students could have predicted that.
Elastic demand is elastic.
A Pirate and a Puritan look the same on a balance sheet.
Of course not. Which is why they've gone from 5 years to 1 or 2. Let someone else take the hit by buying the first few months production - it's going to be like buying a car manufactured on a Monday - way more defects.
And that's what it did. Initially, the demand curve didn't shift, but the supply took a huge hit.
If you don't just read the last post but actually follow the discussion you will see that the argument is that it is unlikely that actual production (That is real supply.) have started to recover and that the shift we see in price is not because of any actual change in supply but because the supplier indicates that there will be a change in supply.
And no, this is not "exactly" how the market is supposed to work. In an ideal market the number of suppliers are near infinite and the price to end consumer is close to production cost. In a market that works like it is supposed to a local disaster will not have global consequences.
Yup, or OEMs (Dell, HP, IBM, Acer, etc) who wanted to keep selling PCs for the same price through the months it would take to recover the supply side. They did this to avoid getting "left behind" and lose out on sales to each other due to having to increase their overall system cost due to drive prices. The truth is that home-built PCs are a tiny tiny fraction of the overall market and they are the ones who got left behind because they have no representative supply chain manager thinking about these kinds of things.
Honestly, the price jump was only because of idiots that rushed out and bought drives when they heard of a possible "shortage" and thus created a shortage.
Sure, because the "shortage" is just a con made by wall street. Are you part of the occupy movement or something? Of course there is a rush of people overreacting too, but it's not like the floods down in Thailand were imaginary. HDD production is way down and with long term contracts with OEMs taking priority the rest of the market was going to get squeezed badly. Everybody that's looked at a price-quantity curve knows that when supply goes way down like that the prices go up. Yes, people that panic buy to be on the safe side amplify it but there wasn't that much in the channel to raid before webshops figured it was a rush and raised prices. By the time "everyone" knows a shortage is coming it's too late to get a good deal already.
Live today, because you never know what tomorrow brings
I simply held off buying any hard drives.
Same here, even though the drive in my main box has been trying to die for months (just went fully titsup over the weekend). I'll still wait, I have a couple of old, small spares that will do until production and prices are normal again.
Free Martian Whores!
With the current trend of a few large companies controlling the market it is getting harder and harder to find markets where the free market model still applies.
This isn't a current trend, it's always been the trend: in any market, as the market matures, the number of suppliers shrinks through attrition and mergers, until there's only a handful of really big companies controlling the whole market. Just look at the automotive market for example: in the USA alone, there used to be dozens of car makers in the early 20th Century, but by 1970 it had shrunk down to 4 main players; it only opened up again when more foreign makers entered the market, namely the Japanese.
Appliances: there's only 3 or so American appliance makers (Whirlpool, GE, Maytag), although recently we've gotten more foreign brands (Samsung, LG, Bosch).
This is just the natural order of things: as a market matures, the players buy each other out or go out of business, until you're left with a few large competitors. Sometimes a monopoly results (or close, with one player being the dominant competitor with a large majority of the marketshare). This is why government regulation is necessary at this stage, to "keep the playing field level" and prevent entrenched players from keeping newer, smaller competitors out of the market the way they did with Tucker cars.
Allowing a free market with little or no regulation is great when a market is immature and there's lots of players and competition (and there's few or no health or safety issues to worry about, like with food); but after a while it becomes necessary or else you get a situation like Microsoft circa 2000, bullying everyone and stifling innovation.
Government should almost never control prices, except in the case of utility monopolies for instance. However, government's responsibility is to provide regulation such that, in most markets (utilities being an obvious exception), no monopoly ever develops, and a healthy number of competitors always exists. The government can do this by preventing mergers. The more competitors there are in a market, the freer that market is, and the better off consumers are (within reason of course, there's a law of diminishing returns here--3 competitors is much better than 2, 5 is better than 3, 10 is better than 5, but 1000 isn't much better than 100, if at all).
It's too bad that only the European governments want to bother providing proper regulation these days, as Americans seem to be perfectly happy with abusive monopolies and lack of consumer choice.
This brings up the question, why did they move their operations to a place where flooding is a problem?
Because it was cheap. I'm sure the people who saved the money by placing their plants there got nice bonuses too.
Possible shortage announced, idiots go rushing to create a REAL shortage.
Hello Dell buys up more drives than they need to try and short the competition. That is what he said, you are too retarded to read English and understand that
Or are you one of the 1% that was born without a brain. I'm betting that is the case.
I've switched to floppies.
If a bad choice of words.
Game theory does have ideal outcomes when the actors play perfectly.
Of course, in the case of economy and statecraft, the ideal solution is to actually make an economy that serves the people, or if unable to do so (it may be we just don't know enough to do such a thing), at least admit that we don't know rather than trying to back justify the current non-solution.
Goes to prove yet again how the "free market", that weird beast so idolized by economists, is such a fickle creature. Cause after over several months underwater, there is NO way you are gonna get a clean room facility up to snuff & speed in a matter of days. Of course, now that the excuse is over, all the hoarding speculators are trembling in fear of getting stuck with their huge stockpile and will start to desperately flood the market.
So in other words, the free market will function in exactly the way it's supposed to
This isn't the free market, this is the boom/bust cycle that has caused so much pain of late.
The free market is a dearly held delusion of those who dont understand that power concentrates and without resistance it concentrates in one place..
Calling someone a "hater" only means you can not rationally rebut their argument.
In the U S of A it's called "The Enron Effect" because Enron traders had their phone calls to power plants (owned by Enron...of course) recorded. Those recordings showed Enron traders asking and sometimes telling power plants when to go "offline" so electric power markets in California could be manipulated as a way of making money.
Glad to hear the shortage is coming to an end though... I really need to upgrade my NAS.
Mr Phong is also glad to see shortage end as he needs to buy rice to feed his family
Think of how stupid the average person is, and realize half of them are stupider than that.
I was initially more concerned about the link between technology and gastric issues until I realized I had misread the article title as, "Hard drive prices slide as thai food aftermath subsides."
As soon as you have government regulating who should be allowed monopolies and who should not it's no longer capitalism or free markets is it! Free means free, not 'governed' or 'regulated'.
This is the short coming of a capitalist/free market system - it's like poker, in the end the guy with the largest pile can always out buy everyone else - especially if he happens to be the bank (the banks own much of the biggest US corporations).
In the end it tends towards what we call communism; where the banks and the state and the corporations are all owned by the same entities. Capitalism, left unregulated becomes communism - ever wondered why the Govt makes so many rulings that benefit the few rather than the many - here's your answer! In the US it's becoming starkly obvious: what government 'for and by the people' would vote to give all it has (while it's in a huge amount of debt to the banks) to the banks and not have it count against the debt? Wake Up!
The federal reserve banks have .org domains, not .gov. The Board has a .gov but it doesn't own the banks, which are private, it just oversees them - in the best interest of the banks, not the best interests of the US. Just ask the Chairman of the United States House Financial Services Subcommittee on Domestic Monetary Policy and Technology - Ron Paul - who knows a thing or two about all this! You know what you've also go the chance to make him the POTUS - that would be a 'change' voting in someone who knows something about money and banking - which as the saying goes, makes the world go round.
I am not thai, but my thai peers have suggested that this is because when the decision was made, there was a competent government in power that could be trusted to operate the flood control mechanisms in that country properly. There was an election fairly recently and the government which was elected had other concerns - hence what happened.
GENERATION 26: The first time you see this, copy it into your sig on any forum and add 1 to the generation.
Wow, that kinda sounds like the USA... decades ago, we had a somewhat competent government in power that could be trusted to do what it could to handle floods and other natural disasters (though obviously technology was a little more limited back then), and now we've happily elected a government that can't handle a hurricane in a part of the country that frequently experiences hurricanes.