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China's Disk Dive

Seagate sticks with Uncle Sam

It has been an eventful few days in Scotts Valley, Calif.

Seagate hit the headlines last weekend when reports suggested that the disk drive vendor was a possible acquisition target for an un-named Chinese technology firm. (See On 3Com's Storage Trail, Huawei & Symantec Make It Official, and In Memory of Al.) Cue the usual rumblings of discontent about U.S. national security, and a swift move by Seagate to dispel the acquisition rumor. (See US Checks Check Point, Sourcefire Glows on Debut, and Check Point Spends on Protection.)

Whether there was any truth in the scuttlebutt or not, it is nonetheless an interesting sign of the storage times. Ten years ago, would anyone have expected to see a vendor of Seagate's size cited as acquisition bait for a firm in China, of all places? Unlikely.

Certainly, there is plenty going on in the Asian disk drive market at the moment. Japanese firm TDK, for example, which was itself bought by Imation earlier this year, spent $123 million for a 73.4 percent stake of Thai disk drive specialist Magnecomp Precision Technology (MPT) a couple of days ago. (See TDK Buys Magnecomp, Imation to Acquire TDK, and Imation Outlines Strategy.)

As for the future... well, who knows? Seagate raised its outlook for the first quarter of 2008 earlier this week and appears to be in rude health. (See Seagate Updates Outlook.) Citing strong demand from users, Seagate execs upped their first-quarter outlook from between $2.9 billion and $3 billion to a range of $3.15 billion to $3.25 billion.

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