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Storage volumes, revenues down sharply

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Worldwide personal and entry-level storage (PELS) shipments totalled 68,5-million units in 2015, representing a decline of -9,2% from a year ago, according to the International Data Corporation (IDC) Worldwide Personal and Entry-Level Storage Tracker.

Annual shipment values were down -15,1% year over year to $5,4-billion. Unit shipments in the fourth quarter (4Q15) experienced a -6,8% decrease from a year ago to 19,1-million units. Shipment values declined along with units in the fourth quarter, down -12,6% to $1,5-billion.

“2015 marks the first year of decline in the personal and entry-level storage market since the Thailand floods in 2011,” says Jingwen Li, senior research analyst: storage systems at IDC. “The growing utilization of cloud storage continues to negatively affect the demand for PELS. In response, players in the PELS market are being forced to either capture more market opportunities through M&A or go through re-organization to better position their PELS business.”

The relative shares of personal versus entry-level storage remained stable in 4Q15. Personal storage continued to account for almost 99% of total market shipments. The shrinking of the PELS market has been negatively impacting the entry-level storage segment throughout 2015. Shipments to this SMB-focused segment were down by -2,5% year over year in 2015.

PELS offerings with higher capacity points continued to gain market share as fierce price competition made these products more affordable. In the 3,5-inch segment, 3Tb to 5Tb drives continued to take share from 1Tb to 2Tb offerings and accounted for 51,5% units shipped. In the 2,5-inch space, 500Gb and 1Tb offerings still dominated the market. However, offerings of 2Tb to 4Tb managed to grow their shares over the past two years.

HDD vendors continued to dominate the personal storage segment (representing 80% of unit share) and gained shipment share in the entry-level segment (capturing 26% unit share). Both HDD and mainstream non-HDD players have been struggling in the PELS market. Western Digital acquired SanDisk to gain more opportunities in the SSD market. Toshiba has been experiencing shipment decline and will have to go through restructuring to better position its HDD business. Smaller vendors like Imation discontinued its personal storage product line while Imation acquired Connected Data to move up to the entry-level space.

USB remained the most popular interface in the PELS market as major players started to roll out offerings with USB Type-C connectors. These offerings are still in the early stages of development, but with speeds comparable to Thunderbolt, these products will potentially create competition with the Thunderbolt offerings.