Fujitsu aims to become bigger hard-disk player

Company wants to double the number of drives it ships by 2008

See correction below.

Fujitsu set out on Friday a strategy that it hopes will propel its hard-disk drive business to grow at about three times the pace of the overall market between now and 2008 to place it among the world's three largest hard-disk drive makers at the end of the period.

The Tokyo-based company is hoping to ride on the back of an anticipated increase in demand for hard-disk drives for consumer electronics and laptop PCs, said Ichiro Komura, corporate senior vice president of Fujitsu, at a Tokyo news conference.

Fujitsu expects worldwide demand for 2.5-inch mobile PC drives to rise from 81 million in 2005 to 210 million units in 2010 and for 1.8-inch drives to rise from 16 million units to 90 million units over the same period.

The company wants to increase its drive shipments to 54 million units in 2008, which is just over double the 26 million drives it shipped in 2005. To achieve this goal, the company is planning to focus on the expanding market for 2.5-inch drives for both consumer electronics products and laptop PCs, begin making 2.5-inch drives for servers, and enter the 1.8-inch drive market for laptops and products like portable digital music players.

Demand from consumer electronics makers is likely to play an increasingly important role in the hard-disk drive market, Komura said. In 2005, the non-IT market represented about 20 percent of the overall market but this is expected to grow to one-third in 2008 and 44 percent in 2010, according to Fujitsu figures.

One of the fast-growing sectors is for 1.8-inch hard-disk drives. Such drives are currently used in products like Apple Computer's iPod music player and Fujitsu isn't in this market. To break into this market, Fujitsu will tie-up with Cornice Inc. to develop a 1.8-inch drive.

Cornice currently manufactures 1-inch drives that are used in a range of portable music players and some cell phones but doesn't have a 1.8-inch drive either so the deal marks an expansion for both companies.

"1.8-inch is exploding right now," said Camillo Martino, president and CEO of Cornice in a telephone interview. "The new Apple iPod volumes are just phenomenal. Companies are like Toshiba and Hitachi are benefiting from that. I think the market will continue to expand very rapidly and it will create many opportunities for suppliers in the next few years."

Fujitsu hopes to unveil the first product from the joint development, a 120GB drive, sometime between April and September of 2007, it said. All sales of the first-generation drive developed under the partnership will be handled by Fujitsu, it said.

Correction: This story as originally posted contained several incorrect figures related to hard-disk drive shipments. The story has been corrected.

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