Original URL: http://www.theregister.co.uk/2008/08/15/seagate_sandisk/

Seagate said to be sniffing SanDisk

Deal more about IP than Flash production?

By Tony Smith

Posted in Hardware, 15th August 2008 08:32 GMT

Is Seagate about to acquire SanDisk? That's one claim that's been doing the rounds at a US Flash storage conference this week.

According to an EETimes report, that's what attendees at the Flash Memory Summit have been whispering.

Neither party's commenting, of course. But would such a deal make sense? Solid-state storage may be a popular topic right now, but there's no sign it's about to kill off the traditional hard drive. As the biggest supplier of hard drives, Seagate has less to fear from SSDs than most.

But it does see a role for the technology, particularly in mobile applications, and has said it too will hop on the SSD bandwagon, early next year. Acquiring SanDisk would allow it to embrace Flash fully.

Not to mention expand its consumer product line through SanDisk's memory card and media player businesses - assuming Seagate keeps them. SanDisk is the world's second biggest supplier of MP3 players, second only to Apple.

But does Seagate need all this? It could buy Flash chips from, say, Samsung and combine them into its own drives, using its extensive storage know-how to deliver drives better tuned to the demands of today's operating systems than current SSDs are proving to be.

Ironically, perhaps, it was SanDisk itself that most recently admitted that the Windows-SSD pairing isn't as harmonious as previously promoted.

Seagate has made aggressive noises in the past about how it believes many SSDs infringe technology it owns. In April this year, Seagate launched legal action against SSD company STEC, alleging patent infringement. That appears to be a test case, gauging how strong Seagate's patent claim is. Buying SanDisk would add considerably Flash and SSD IP weight to Seagate.

Going forward, IP is going to become increasingly important in a market built on cheap Flash chips and the kind of production capacity the likes of Samsung and Intel can bring to bear.