Hard drive manufacturers cutting warranties

FRAMINGHAM, Mass. — In a bid to save money or redirect funds to product development, Seagate Technology LLC and Western Digital Corp. are cutting hard drive warranties — in some cases from five years to one.

Seagate’s warranties on certain drives were shortened as of Dec. 31, and Western Digital followed suit on Jan. 2. All drives shipped prior to those dates will continue to carry the warranty term in effect at the shipping time.

First reported by The Register , a London-based technology Web site, the reductions mean some of the vendors’ most popular PC drives will no longer carry three- or five-year warranties.

Seagate said it is reducing warranty periods as a way to redirect cash flow to product development. The manufacturer said there is no change in the warranties of “mission-critical” enterprise drives including the Cheetah line. But warranty periods for the Momentus XT hybrid drive and nearline products including the Constellation 2 series are being cut from five years to three.

Warranties for some of Seagate’s desktop and notebook drives, including the Barracuda, are being cut from five years to one.

Western Digital announced that it’s cutting warranties for Caviar Blue, Caviar Green and Scorpio Blue drives from three years to two, but it didn’t offer an explanation for the changes.

The news comes as a number of enterprise-class storage solution providers have rasied their prices. Last week NetApp Inc. announced to customers that beginning Feb. 6, it will be raising the price of hard disk drives in its storage systems by five per cent to 15 per cent because of worldwide supply shortages.

Two other enterprise-class storage vendors have also raised their hard drives prices in as many months, and Lenovo Group Ltd. said it had run short of certain drives for its PC systems.

Flooding in Thailand that began in August and lasted about three months has wreaked havoc on disk drive manufacturers , in some cases shutting down as much as 75 per cent of production.

“Similar to other vendors we have seen a negative impact to our drive costs. While we initially absorbed the cost increases to protect our partners and customers, we are no longer able to do so,” NetApp stated in its announcement.

IDC analyst John Rydning said the most “painful period” for drive shortages will last from December 2011 through February 2012.

“We expect the situation will improve, but it won’t feel as if things are back to normal until 2013,” he said.

In November, Hewlett-Packard Co. sent a letter to its customers stating that the reduction in available hard drives had caused “immediate and significant increases in the prices that HP and all other vendors pay for hard disk drives.”

Tom Joyce, HP ‘s vice president of marketing, told customers that component prices had risen about 20%, forcing HP to increase its prices for certain hard drives. He did not specify which hard drives were included in the price increases.

“In the ordinary course of business, we often adjust prices we charge for components based upon market conditions, and this situation is no exception. What is different now is that some of these component prices may rise significantly, and for an indeterminate period of time,” Joyce stated.

Last month, EMC Corp. also sent a letter to customers explaining that it would be jacking up its drive prices beginning this month across all EMC business lines for an indefinite period.

Also in November, Lenovo sent an email to its corporate IT customers telling them it is out of a number of hard disk drives, including the highly popular 7,200-rpm models.

In the email obtained by Computerworld U.S., a Lenovo representative stated that customers who normally purchase systems with 160GB 7,200-rpm drives, or various other drives that are unavailable, will have to settle for “off-spec” drives.

Most recently, drive prices on consumer sites have begun to settle down . According to Dynamite Data, the top 50 hard drives on sites such as Newegg.com and Tigerdirect.com, leaped in price by 50 to 150 per cent after the flooding.

(From Computerworld U.S.)

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