HDD shortage may last through Q1 2011

As notebook brand vendors are starting to prepare their shipments for the end-of-year holidays, hard drive makers, which had conservative production plans for the fourth quarter due to a weaker-than-expected third-quarter performance, have recently started seeing short supply of hard drives and the problem is likely to persist through the first quarter of 2011, according to sources from hard drive makers.

Due to Europe's bond crisis, the euro exchange rate to the US dollar dropped significantly in the second quarter, causing notebook brand vendors to lower the specifications of their notebooks in Europe to maintain profitability, with hard drives being a feature lowered by the vendors. As a result, demand for large storage hard drive dropped significantly in the second and the third quarters.