Western Digital announced today in a press release that the arbitrator for a Seagate vs. Western Digital complaint sided with Seagate and ordered an award of $525 million paid to Seagate. The arbitration was initiated when Seagate alleged misappropriation of confidential information and trade secrets by Western Digital once a Seagate employee defected to Western Digital.

CEO John Coyne intends on challenging this award, stating that WD believes “the company acted properly at all times” and adding that the ruling “does not affect our ability to conduct our operations, to complete the recovery and recommencement of our Thailand operations”.

Along with most other hard drive manufacturers such as Toshiba, Hitachi, and of course Seagate, Western Digital is suffering losses after major flooding recently struck Thailand operations. DigiTimes reported that Seagate anticipates a 10-18% reduction in hard drive output as a result of the flooding, with other manufacturers surely similarly affected, resulting in a hard drive shortage for the coming months.

Source: Press Release

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  • C'DaleRider - Monday, November 21, 2011 - link

    No conspiracy, just simple economics. You want to decrease demand for an item in short supply, you raise the price. You have a glut of a product and want to move the built up inventory, you drop the price.

    In this case, the hike in prices are designed to curb sales, simple as that. The added profit is just a side benefit for the sellers.
  • ViRGE - Tuesday, November 22, 2011 - link

    Furthermore you have to contend with the fact that most HDDs are already claimed by OEMs in long term contracts. The only places the 20% could come out of are the spot market and the retail market (which in the case of OEM drives are one in the same). Hence OEMs are secure in the number of drives they need, but the number of drives that will be available for purchase for us has taken much more than a 20% hit.
  • anactoraaron - Tuesday, November 22, 2011 - link

    okay... then explain to me why seagate drives are as expensive as other drives. They weren't effected by the flooding. Sure they may have some problems with certain parts being in short supply but still.
  • ViRGE - Tuesday, November 22, 2011 - link

    Where do you think all of those WD customers went when spot market allocations were cut? Hard drives are a commodity, one drive is just as good a substitute for another.
  • Veroxious - Tuesday, November 22, 2011 - link

    Being in tech support for over a decade 80-90% of all failed drives have been WD, pre Seagate Maxtor and Hitachi drives with WD accounting for all the failed 3.5" drives. I would not touch the WD drives except for the Black series and the Raptors. Hitachi 2.5" drives really suck too.
  • ezorb - Tuesday, November 22, 2011 - link

    thats funny, cause I own about ~40 hard drives, about 50/50 WD/Seagate and I have had one WD external drive fail and about 4 segates fail in the last 5 years or so.
  • mino - Wednesday, November 23, 2011 - link

    I would not touch the WD drives except for the Black series and the Raptors.

    Then by your own account WD, as a company, is not the culprit.

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