| Hitachi Marshals Resources to Double 2005 Output of Consumer Electronic Hard Drives Arsenal of CE-Specific Hard Drives to Target High-Growth Segments; Company Catapulted to Leadership Position in 4Q04
SAN JOSE, Calif. -- (BUSINESS WIRE) -- March 1, 2005 -- After leading the industry in hard drive shipments for consumer electronics (CE) in the fourth quarter of 2004 (IDC(1)), Hitachi Global Storage Technologies is rallying company resources to more than double the total shipment of CE hard drives in 2005.
To achieve this aggressive growth rate, the company will tailor product development, customer support and marketing efforts to target three key consumer segments -- MP3/personal media players (PMP), digital video recorders (DVR) and mobile phones. Already the leader in one-inch hard drives for MP3 players, Hitachi will apply that success formula to capture the PMP, DVR and mobile phone segments.
In 2005, Hitachi plans to more than double production of the one-inch Microdrive, including the newly announced smaller one-inch drive, "Mikey," which is designed to spur the growth of hard-drive-based mobile phones.
Hitachi will also triple production of its 1.8-inch Travelstar product to further penetrate the music jukebox/PMP segment. With the recent announcement of "Slim" -- Hitachi's smaller 1.8-inch product -- the company has received tremendous interest in the form factor, with demand potentially rivaling that of the one-inch Microdrive.
In addition, Hitachi plans to increase production of the 3.5-inch Deskstar product for CE applications by more than 50 percent. With enhanced video streaming functionality and 500 GB(2) of storage, the Deskstar product line will provide a powerful storage solution for the DVR segment.
Industry analysts watching the adoption of hard disk drive in consumer electronics have recently predicted that 20-22 percent of all hard drives shipped in 2005 will go into CE devices as compared to 15 percent in 2004. In 2005, based on current data, Hitachi's doubling of CE hard drive shipments is expected to surpass the overall industry projection.
"Hitachi's strength in CE hard drives is now validated with IDC's recent findings and provides a strong basis from which to accelerate our CE business in 2005," said Bill Healy, senior vice president, product strategy and marketing, Hitachi Global Storage Technologies. "Hitachi's intensified focus in the CE segment hard drive will mean good news for end-users as we work on developing smaller, high-capacity hard drives that are more rugged, require less power and cost less."
"In 2004, Hitachi established a credible leadership position on the CE hard drive landscape," said John Buttress, IDC research manager. "Hitachi's aggressive plans for 2005 indicate a serious and strong commitment to maintaining a leadership position in this very competitive and high-growth segment."
According to IDC(1), Hitachi was in first place in total hard drives shipped for CE devices in fourth quarter 2004 and in second place for the full year. Hitachi led the final quarter of year with 24.7 percent of the CE segment and finished the year with 19.8 percent.
To further support Hitachi's push into the consumer electronics space, the company plans to expand both the number of retail products offered and the number of traditional and online stores through which they can be purchased. Hitachi plans these developments for the second quarter of this year.
Also as part of its 2005 CE strategy and announced separately, today, Hitachi will open five worldwide Hitachi Design Studios that will specialize in helping customers integrate hard drives into consumer electronic devices. By April, the centers will be open for business in Fujisawa, Japan; Havant, UK; Rochester, Minnesota; Shenzhen, China and Taipei, Taiwan. This strategic move will enable Hitachi to accelerate the adoption of hard drives in CE devices and lead the fastest-growing segment of the hard disk drive industry.
CE Hard Drive Arsenal
Hitachi has custom designed hard drives for CE devices by fine-tuning specifications to the needs of consumers, including lower power consumption for longer battery life, smaller device size, higher capacity, lower cost, easier interface for integration and higher shock tolerance. Many of these features have gone into developing the Hitachi CE hard drive line-up for 2005:
-- "Mikey" -- world's smallest one-inch with industry-leading capacity(8-10 GB) for mobile phones and other portable, handheld devices
-- Microdrive 3K6 -- world's most popular and highest capacity one-inch shipping in volume for MP3, PDAs, digital video and still cameras
-- "Slim" -- world's smallest 1.8-inch drive, tailored for CE -- ideal for MP3, PMP, external portable storage, converged application devices
-- Deskstar 7K500 -- world's highest capacity 3.5-inch drive for DVRs, HDTVs, high-end media centers (with "Smooth Stream" technology, based on newly ratified ATA-7 AV Streaming Feature Set standard, to enhance video streaming functionality)
-- Endurastar J4K30 -- wider temperature range (-20 degrees C to +85 degrees C) for rugged environments -- automotive, navigation applications
(1) IDC Q404 analysis and 2005 forecast
(2) 1 gigabyte = 1 billion bytes
About Hitachi Global Storage Technologies
Hitachi Global Storage Technologies was founded in 2003 as a result of the strategic combination of Hitachi's and IBM's storage technology businesses. By the end of 2003, Hitachi GST became the industry's second largest hard disk drive manufacturer in revenue, and maintained that position into 2004.
The company's goal is to enable users to fully engage in the digital lifestyle by providing access to large amounts of storage capacity in formats suitable for the office, on the road and in the home. The company offers customers worldwide a comprehensive range of storage products for desktop computers, high-performance servers and mobile devices. For more information on Hitachi Global Storage Technologies, please visit the company's Web site at http://www.hitachigst.com.
About Hitachi, Ltd.
Hitachi, Ltd. (NYSE:HIT), headquartered in Tokyo, Japan, is a leading global electronics company, with approximately 326,000 employees worldwide. Fiscal 2003 (ended March 31, 2004) consolidated sales totaled 8,632.4 billion yen ($81.4 billion). The company offers a wide range of systems, products and services in market sectors, including information systems, electronic devices, power and industrial systems, consumer products, materials and financial services. For more information on Hitachi, please visit the company's Web site at http://www.hitachi.com.
These materials contain forward-looking statements within the meaning of the federal securities laws, including statements about the following: the future demand for hard disk drives, the potential development of future products, projections for future investment in manufacturing capacity, and projections for future demand for consumer products. These statements are subject to risks and uncertainties that could cause actual results and events to differ materially, including the following: possible fluctuations in the demand for our products; the introduction of new products by competitors or the entry into the market of new competitors; possible delays in developing new products, and the possibility of legal disputes. A detailed discussion of other risks and uncertainties that could cause actual results and events to differ materially from forward-looking statements is included in Hitachi, Ltd.'s most recent filings and reports with the Securities and Exchange Commission. Hitachi, Ltd. and Hitachi GST undertake no obligation to update forward looking statements to reflect events or circumstances occurring after the date of this press release.
New Hitachi Design Studios to Incubate Hard-Drive-Based Consumer Devices; Worldwide Design, Integration Centers to Hasten & Ease Adoption of Hard Drives
SAN JOSE, Calif. -- (BUSINESS WIRE) -- March 1, 2005 -- Hitachi Global Storage Technologies is announcing the opening of five new centers around the globe that will specialize in helping customers integrate hard drives into consumer electronic (CE) devices. By April, the new centers -- called the Hitachi Design Studios -- will be open for business in Fujisawa, Japan; Havant, UK; Rochester, Minnesota; Shenzhen, China and Taipei, Taiwan.
This strategic move will enable Hitachi to accelerate the adoption of hard drives in CE devices and lead the fastest-growing segment of the hard disk drive industry. Hitachi is one of the top two providers of hard drives for CE devices, according to IDC(1). The analyst firm also predicts that the HDD industry will ship more than 200 million hard drives for consumer electronics (including home networking and storage) in 2008(1), accounting for about 40% of all HDDs.
"We're focusing on consumer electronics in big way with the worldwide opening of the Hitachi Design Studios," said Bill Healy, senior vice president, product strategy and marketing, Hitachi Global Storage Technologies. "Hitachi's expertise in miniature hard drives and background in developing consumer electronics gives us an unmatched skill set to offer credible and critical guidance to our customers. We also believe that the Hitachi Design Studios will help to stimulate and incubate fresh ideas for usage of hard drives in consumer devices that lie beyond the immediate stretch of the imagination."
To support Hitachi's overall 2005 CE strategy, the Hitachi Design Studios will focus on three key CE segments, which are the highest-growth segments -- MP3/personal media players (PMP), digital video recorders (DVR) and mobile phones. The Hitachi Design Studios will provide support to small- and medium-sized customers, where some of the most innovative applications are born and, often, where hard-drive integration support is most needed. The Design Studios will also provide support to select large customers with newly emerging applications such as hard drive-enabled mobile phones.
Integrating hard drives into CE devices requires a level of understanding and approach different from IT devices. For example, consumer usage patterns require longer battery life, more rugged designs, higher capacities, smaller footprint, less focus on performance and greater emphasis on value. These are the factors that Hitachi CE engineers keep in mind as they advise customers on selecting the right hard drive, software compatibility with various operating systems, reliability and mounting considerations, and design integration. In working with CE customers, Hitachi will also be able to identify the direction in which consumer trends are heading and can work with its Research and Development departments to tailor new hard drives for this segment.
"Design centers such as Hitachi's reaffirm the growing importance of the consumer electronics segment of the disk drive business. This latest effort further illustrates the company's commitment in small-form-factor HDDs," said Dave Reinsel, IDC Storage Program Director.
Vision Technology Corporate Limited, a leading distributor of computer peripherals and consumer electronics products, was the first company selected by Hitachi GST in 2003 to develop consumer electronics business in the China market.
"With nearly 80 percent of the integration work for consumer devices being done in Asia Pacific, we are clearly in need of this type of support," said Lewis Lo, CEO, Vision. "Hitachi has long been at the forefront of small-form-factor hard drives and is in the best position to advise manufacturers on how to incorporate them into devices across a variety of consumer applications."
The new Hitachi Design Studios will initially provide support on eight application areas, with special emphasis on MP3/PMP, DVR and mobile phone applications:
-- Recording -- digital video recorder, personal video recorders, set-top box, digital audio recorder, iVDR, CCTV
-- Photography -- digital still & video cameras
-- Entertainment -- personal video player, video viewer, personal media player, MP3, flat panel TVs
-- Industrial -- external storage, USB applications, industrial applications (printer, copiers, switches, routers, PBX, robotics, test & measurement)
-- Handhelds -- smart phones, PDA, wearable PC, GPS, converged devices
-- Automotive -- automotive systems, navigation systems, telematics
-- Gaming -- game consoles (information appliances)
-- Reference designs -- provide help for developing prototype designs with hard drives
Customers working through the Hitachi Design Studios can also qualify for the "Hard Drive by Hitachi" ingredient branding program. This red-and-white sticker, affixed to the outside of the end-user device, signifies the high quality and integral role that the Hitachi's hard drive plays within the device.
Locations and contact details for the Hitachi Design Studios can be found at http://www.hitachigst.com/designstudios.
(1) Source: IDC, The HDD Industry 2004 and Beyond, Salient Dynamics and the Impacts to Forecast, 16 February 2005.
About Hitachi Global Storage Technologies
Hitachi Global Storage Technologies was founded in January 2003 as a result of the strategic combination of Hitachi's and IBM's storage technology businesses. By the end of 2003, Hitachi GST became the industry's second largest hard disk drive manufacturer in revenue, and maintained that position into 2004.
The company's goal is to enable users to fully engage in the digital lifestyle by providing access to large amounts of storage capacity in formats suitable for the office, on the road and in the home. The company offers customers worldwide a comprehensive range of storage products for desktop computers, high-performance servers and mobile devices. For more information on Hitachi GST, please visit the company's web site at www.hitachigst.com.
About Hitachi, Ltd.
Hitachi, Ltd. (NYSE:HIT), headquartered in Tokyo, Japan, is a leading global electronics company, with approximately 326,000 employees worldwide. Fiscal 2003 (ended March 31, 2004) consolidated sales totaled 8,632.4 billion yen ($81.4 billion). The company offers a wide range of systems, products and services in market sectors, including information systems, electronic devices, power and industrial systems, consumer products, materials and financial services. For more information on Hitachi, please visit the company's Web site at www.hitachi.com. |
