Seagate and Micron Sign Multi-Year Agreement

http://www.forbes.com/sites/tomcoughlin/2015/02/12/seagate-and-micron-sign-multi-year-agreement/

Micron Technology and Seagate Technology, both significant players in flash memory and HDDs, announced a strategic agreement that according to the press release “…establishes a framework for combining the innovation and expertise of both companies.” This agreement may exceed in its scope prior agreements on flash memory technology by a HDD company.
Seagate and Western Digital, the two biggest HDD companies, have made acquisition of various companies involved in flash memory technology. These have included Seagate’s acquisition of LSI’s flash memory controller business as well as Western Digital’s acquisition of Skyera and before that Virident. In addition Seagate obtained some flash memory supply as part of its acquisition of Samsung’s HDD business, while HGST (a division of WD) has a multi-year agreement with Intel on design and supply of flash chips for enterprise SSDs.

The Micron-Seagate agreement will have the two companies working on next-generation SAS SSDs and also supplies Seagate a strategic NAND supply. The companies believe that this agreement will lead to future collaboration on enterprise storage solutions featuring Micron NAND flash memory. Note that Micron is the third largest flash memory chip supplier after Samsung and Toshiba/SanDisk (who have joint fabrication facilities).

Considering Seagate’s recent announcements on storage systems (leveraging their acquisition of Xyratex’s storage systems business in 2013) this might include future offerings that combine SSDs and HDDs in interesting ways. The Seagate release includes quotes from EMC and HP indicating support by enterprise storage companies for joint development by Micron and Seagate for enterprise flash memory solutions.

While we are a few years away from SSD industry maturity, as the SSD industry matures the profit margins will decline and the number of suppliers will decrease.   This will put pressure leading to vertical integration of flash chip supplies (as well as flash controllers) with the SSD suppliers.   If the HDD companies are going to become leading SSD suppliers they must have access to low cost flash memory supplies.

So it should not be surprising to see additional partnerships and perhaps consolidation between HDD and flash memory companies in the next few years.   Digital storage for enterprise applications will likely require multiple technologies used together to create multi-tiered automated storage solutions and providing the best combination of cost and performance.