Reuters reports Hitachi will quit production of 1" and 1.8" HDDs around next summer as demand is shifting to flash memory chips.
The Nikkei also said Hitachi rival Fujitsu Ltd has given up on plans to enter the market for small drives. Fujitsu had been developing 1.8-inch drives with U.S.-based Cornice with plans to bring a product to market in 2007.
No one at Hitachi or Fujitsu could be reached for comment.
Small hard drives are increasingly being replaced by flash memory chips as the memory storage device in video cameras and portable music players, such as Apple Inc's popular iPod, as flash memory capacity improves and prices come down.
Hitachi will focus on 2.5-inch and 3.5-inch drives, anticipating strong demand for the bigger drives that are used in personal computers and digital electronics such as DVD recorders, the Nikkei said.