Integration Boosts HDD Semiconductor Market in 1998, According to IDC

Framingham, MA, January 14, 1999 — In 1998 HDD chip suppliers moved closer towards system-on-chip solutions, as drive OEMs looked to cut costs in a highly competitive environment. In a newly published 1998 HDD Semiconductor Year-In-Review bulletin, International Data Corporation (IDC) estimates that chip consolidation will continue to reduce the overall component count in the next few years. In fact, IDC believes that by the year 2000, the typical desktop board layout will be reduced to just five chips.

The 1998 HDD Semiconductor Year in Review: TI's Broad Offering Stakes Company to Overall Lead breaks out market revenues into the four primary components: ASIC, read channel, motor control and pre-amp. IDC expects these four device categories to represent an increasing percentage of the total HDD chip architecture. 1998 saw Texas Instruments as a top three player in all four primary categories of the HDD semiconductor industry with 35% unit share (222 million units) and 31% revenue share ($899 million).

Christopher Dawe, Research Analyst for IDC's Semiconductor Research program, says, "As integration increases in the Winchester HDD market, only companies that can provide the system-on-chip solutions will remain major suppliers. Current market leaders TI, Lucent, IBM, ST Microelectronics, and Cirrus Logic are positioned to remain on top for the next several years. These companies all have proven manufacturing acumen, expansive IP libraries, healthy existing market share positions, and most importantly, strong relationships with drive OEMs."

Market Leaders by Component Category

· Texas Instruments is the ASIC leader within HDDs, due primarily to Maxtor and Quantum, two of the leading desktop drive manufacturers. In 1998, TI shipped 59 million units and took in revenues of $436 million.

· Lucent emerged as the leading supplier in the read channel market, displacing TI. IDC estimates the company shipped nearly 46 million units, representing $244 million in revenue.

· Fortified by its presence in Seagate and WD's desktop drives, ST Microelectronics is the motor control leader with 42 million units shipped, resulting in $108 million in revenue. Hitachi closely follows in the motor control category with 35 million units shipped and $91 million in revenue.

· In the pre-amp area, Texas Instruments grew its 1997 pre-amp market share from 42% to over half of the market, 52%, in 1998. Total units shipped in 1998 for the company were 95 million and revenues were $183 million.

For more information or to purchase this bulletin (#B18113), 1998 HDD Semiconductor Year in Review: TI's Broad Offering Stakes Company to Overall Lead, call Cheryl Toffel at 1-800-343-4952, ext. 4389. IDC's Web site (http://www.idc.com) contains additional company information, recent news releases, and offers full-text searching of the latest available research.

About IDC

International Data Corporation is the information technology industry's most comprehensive resource on worldwide IT markets, trends, products, vendors, and geography’s. IDC provides data, analysis and advisory services to the world's leading IT suppliers as well as IS professionals in finance, insurance, entertainment, advertising, consumer goods and publishing. IDC's research and opinions are based on the results of more than 300,000 end-user surveys, in-depth competitive analysis, broad technology coverage, and strategic analysis. IDC is committed to providing global research with local content through its 500 analysts in more than 40 countries worldwide. Additional information on IDC can be found on its Web site at http://www.idc.com.

IDC is a division of International Data Group, the world's leading IT media, research and exposition company.

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