@rick.merritt: is this more of business realignment from Samsung, trying to play safe? Seems to me that they want to leverage their expertise with SSD's and hybrid drives with a big name vendor like Seagate for some guaranteed revenue. On the flipside, Seagate may be also diversifying their SSD vendors/sources. Interesting times...
Actually the profit margins in the HDD business are going to grow. You no longer have 5 players who potentially may decide to drop prices, you only have 3. Toshiba may end up growing market share due to the consolidation. SSD is still years away from being cost competitive. Less than 1% of consumers are willing to pay a $200 upgrade to SSD on a $500 laptop. And everyone I know who buys a SSD ends up having to buy a HDD due to capacity reasons. And your backup drive is going to be a HDD. All the HDD players have SSD solutions. SSD will eventually undergo consolidation since there are many players involved. A SSD is like a cell phone, it lasts for 2-3 years and then become unreliable. HDD generally only become unreliable once you exceed 80% of capacity.
Hard drives seem to me to be a technology that is fading into the sunset as far as real innovation is concerned. The handwriting seems to be on the wall as far as the future being SSD. The current wave of consolidation only emphasizes this point.
The last thing I hoped to hear regarding Samsung HDD business was this. Lack of competition aint gonna help innovation. Moreover I am not sure, how this acquisition benefits Seagate for real.
"With these agreements, we expect to achieve greater scale" IMO they have all the scale they need as if now, further increase wont benefit much for anyone. Hope it wont end up like their Maxtor acquisition!