Shareholders approved the acquisition of hard disk manufacturer Maxtor to rival Seagate in May, giving a Seagate a 5 percent growth in market share. The sudden surge, however, has triggered a price war as rivals vie to cease lost market share.
Following the acquisition in the second quarter, Seagate projected it would garner half the market share previously owned by Maxtor, said Krishna Chander, senior analyst for storage at iSuppli. This meant the remaining half was up for grabs, spurring a flurry of activity as the major HDD suppliers vied for a piece of the pie.
Suppliers became aggressive with pricing, causing low-end desktop computers hard drives to experience pricing declines as high as seven percent, Chander explained. These severe drops affected prices for almost all HDDs across the board.
The market research firm believes the price wars may continue until the end of the year, when the market-share situation stabilizes.
With the holiday season approaching, every HDD supplier is viewing Maxtorâ€™s remaining share as a key opportunity to increase its sales to key OEMs, the firm stated.