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Seagate to buy Samsung hard drive business

Published on 19th April 2011 by Paul Goodhead

Samsung's F3 range of SpinPoint hard drives are popular with enthusiasts.

Yesterday's rumours about Seagate taking over Samsung have now been confirmed, as the two firms have just announced a deal that will see Seagate absorbing Samsung’s hard disk operations.

The two storage giants claim the deal is designed to enable Seagate to ’achieve greater scale and the companies to deliver a broader range of innovative storage products and solutions to its customers.’ They also pointed out that this deal is simply an extension of an existing strategic relationship, which the two companies entered into in August 2010.

In return for handing over its hard disk business, Samsung will receive a considerable sum of $1.375 billion, which will be made up of 50 per cent stock and 50 per cent cash. This means that Samsung will come out of the deal holding a stake of just under 10 per cent in Seagate.

Samsung will also benefit from an agreement to supply Seagate with NAND flash memory for its range of enterprise SSDs and solid state hybrid drives. To cement the relationship between the two companies further, Samsung will also be able to appoint an executive to Seagate’s board of directors.

The announcement states that the deal is expected to be done and dusted by the end of 2011 and shouldn’t lead to any significant number of layoffs or facility closures. The two companies don't expect any significant regulatory concerns either.

Are you sad to see Samsung ducking out of the hard disk business? Let us know your thoughts in the forums.

29 Comments

Discuss in the forums Reply

ZeDestructor 19th April 2011, 11:41

I'll miss Samsung. They were essentially my goto HDD manufacturer because they were the most reliable in my experience. Guess I'll be WD only from now on :(

Kacela 19th April 2011, 11:51

I too, will miss Samsung. In my over 30 years of selling hardware, Samsung was the most reliable out there, bar none. Seagate also seems to historically have had real difficulty with change - hopefully the appointment of one of Samsungs people onto the board of Seagate will give them the shot in the arm they need to step up. Time will tell.

Snips 19th April 2011, 12:04

As long as Spinpoints still exist in this arrangement then cool. Well until SSDs come down a bit more in price.

Podge4 19th April 2011, 12:11

If it makes for a better and possible cheaper set of hdd and ssd devices then so be it. Im sure they'll be around in one form or another just not under a Samsung name.

feathers 19th April 2011, 12:12

It will mean the end of reliable samsung hard disks. Seagate make hard disks with short lifespans.

Instagib 19th April 2011, 12:26

I personally have found seagate drives to be as reliable as their samsung counterparts, so really don't see a problem there. My main concern is now the shortage of compitition in the hdd market. Who's left: Western Digital? I hope prices don't suffer.

Mankz 19th April 2011, 12:33

Its sad because as others have said, Samsung's were just my simple default go-to HDD, which I recommended to everyone. I might actually have to start looking at the HDD reviews.

feathers 19th April 2011, 12:45

Quote:

Originally Posted by Instagib
I personally have found seagate drives to be as reliable as their samsung counterparts, so really don't see a problem there. My main concern is now the shortage of compitition in the hdd market. Who's left: Western Digital? I hope prices don't suffer.

I have found just the opposite. Every seagate drive I have owned has developed sector errors after a few years. A friend also experienced the same. Also someone else I know had a screwed system last year. Turns out one of the drives was screwed. Shock, surprise - it was a seagate! There was only one company worse than seagate and that was maxtor. Maxtor were bought out by seagate. It would be a shame for samsung to go the same way.

Bungletron 19th April 2011, 12:57

Samsung drives are great, super reliable, solid performance and often the cheapest component on the market. It is this kind spec that may be losing them money (they obviously did not catch as much of the market share as their bean counters predicted) so with Samsung out of the picture I am worried that mediocre product and inflated pricing may become the standard.

loftie 19th April 2011, 12:58

I have an old 250 GB maxtor drive, it's 7 years old, still going. Obviously not as fast as the WD or F1 i have next to it, but it still works. I am sad to see samsung go, and I'm worried about competition.

Oggyb 19th April 2011, 13:11

Like lots of others, Samsung are my go-to company for HDDs. I hope they read these enthusiast mag columns and see the mistake they've made.

Bungletron 19th April 2011, 13:30

Quote:

Originally Posted by Oggyb
Like lots of others, Samsung are my go-to company for HDDs. I hope they read these enthusiast mag columns and see the mistake they've made.

I reckon they know that already, we just do not make up enough of the market to make it economically viable. If you break up a Dell or HP you will most likely find a WD or Seagate drive inside, I think Samsung would have liked to have gotten some of these contracts by now but without it they were onto a loser no matter how good their drives are. With shares and a clear revenue stream the Seagate deal must look very solid to Samsung at the moment.

Th3Maverick 19th April 2011, 13:50

Rather than nay-saying this deal, I'm gonna go out on a limb and say that I hope Seagate learns a lesson from Samsung on how to produce a decent drive. Sadly, I feel it's gonna take a few years before we see any results from the deal, though.

snootyjim 19th April 2011, 14:01

I love how all the comments are people arguing the toss about which drives are the most reliable...

Surely the huge concern is that there will now be just 3 main hard drive competitors in Seagate, Western Digital and Hitachi (plus Fujitsu/Toshiba perhaps)?

The numbers have been dwindling for years... can't do any good for the consumers.

azazel1024 19th April 2011, 15:43

Well I guess I know I'll be buying a Samsung F4eg or two before the year is out then. *sigh*

One more product/company to be run in to the dust.

I hope it means that Seagate will at least adopt Samsungs better stuff. Like, oh their entire drive line and drop their own drive line. The LP/green Seagates seem decent at first, until you have experience with them. I want low power, quite and speed (and reliability) that equals Samsung.

Xir 19th April 2011, 16:08

I'll buy a drive or two before they disappear, should be on the safe side for a few years.

pingu666 19th April 2011, 16:51

damn :(
modern seagoats drives ive had have been disapointing, had a couple with clunk of death :/

Fizzban 19th April 2011, 16:56

Quote:

Originally Posted by Mankz
I might actually have to start looking at the HDD reviews.

What HardDrive reviews? I don't think bit-tech has done one since the F3's first shipped (not counting SSD's or externals). Can't say I've noticed others around either, not that I've been looking. No need, what with the F3 being so good.

FelixTech 19th April 2011, 17:36

I would have been a Samsung person following the good revies in Custom PC, but after finding that Samsung drives were incompatible with my P5K Premium I ended up with a Seagate. The real question is whether they will keep both brands going, as Seagate and Samsung are kind of at opposite ends of the price bands.

play_boy_2000 19th April 2011, 17:51

With the price/GB for HDDs having come down so much in the last 5 years, it's not suprising that samsung is ditching a market with what I assume must be razor thin margins to focus on more lucrative aspects of their business (smartphones, tablets, TVs, etc).

I am a bit worried that toshiba/fijitsu dosn't have the required market share to prevent a duopoly, although price fixing would be dead obvious for consumer class bare drives.

DXR_13KE 19th April 2011, 18:18

NOOOOOOOOOOOOOOOOOOOOOO!!!!!!!!!! WHYYYYYYYYY?!?!?!?!?!?!?!?

Chocobollz 19th April 2011, 19:46

Quote:

Originally Posted by feathers
Quote:
Originally Posted by Instagib
I personally have found seagate drives to be as reliable as their samsung counterparts, so really don't see a problem there. My main concern is now the shortage of compitition in the hdd market. Who's left: Western Digital? I hope prices don't suffer.

I have found just the opposite. Every seagate drive I have owned has developed sector errors after a few years. A friend also experienced the same. Also someone else I know had a screwed system last year. Turns out one of the drives was screwed. Shock, surprise - it was a seagate! There was only one company worse than seagate and that was maxtor. Maxtor were bought out by seagate. It would be a shame for samsung to go the same way.

It probably just a coincidence because according to my own experience, it was Samsung which (once again) the least reliable manufacturer between the three. I have a maxtor drive here and it is still kicking after 10 years (LOL), and I know several peoples who have maxtor and so far, they're very reliable. In fact, when Maxtor was bought by Seagate, I feel a little sad because they were the drive manufacturer I woud recommend to anyone.

And the same couldn't be applied to Samsung because there are some of my friends who got a broken drives and some of 'em are Samsung (the other would be Seagate). So, from my own experience, WD, Toshiba, etc. are okay, while Samsung & Seagate are the brands to avoid.

One thing I've found Samsung lacking is their supporting softwares. While Seagate has the SeaTools & WD has the xxx (forgot the name LOL), Samsung have a bunch of different software for each model. This would be a problem when someday the drive is having problem (though I don't know if it is still the case now because I don't know anyone here with a Samsung drive anymore).

Cerberus90 19th April 2011, 22:28

Looks like its gone ahead.

Seagate paid $1.75 billion USD.

Link

DragunovHUN 19th April 2011, 22:32

http://www.nooooooooooooooo.com/

dark_avenger 20th April 2011, 01:14

Just FYI if you read the first article this just leaves Seagate, WD and Toshiba. Hitachi and Fujitsu were bought by WD already...

NethLyn 20th April 2011, 01:31

Quote:

Originally Posted by Cerberus90
Looks like its gone ahead.

Seagate paid $1.75 billion USD.

Link

Good business for Seagate, Samsung were going to go whatever happened and WD stuck with buying the next firm to inherit IBM's tech.

It's all in the method though, deliberately dropping prices to get in one last Christmas of good sales, it's like an air tour operator going out of business and taking orders up to the last day.

So when it's time to buy a flat TV, or a new phone, guess which firm is off the list?

Xir 21st April 2011, 12:00

Looking at Samsung 1TB drive at the moment.
Can anyone tell me what the difference between the F3, F3R and F3EG is?

Pete J 21st April 2011, 12:59

Quote:

Originally Posted by DXR_13KE
NOOOOOOOOOOOOOOOOOOOOOO!!!!!!!!!! WHYYYYYYYYY?!?!?!?!?!?!?!?

Pretty much this. Looks like I'll be switching to WD.

Quote:

Originally Posted by Xir
Looking at Samsung 1TB drive at the moment.
Can anyone tell me what the difference between the F3, F3R and F3EG is?

Get the F3. The F3EG is a wimpy 'green' version and the F3R is the enterprise version, which cost a lot more.

chrismarkham1982 23rd April 2011, 22:57

oh well looks like a couple of 1tb drives coming my way before the end of summer although id imagine that seasgate will probably take on more of what makes the f3's great to possibly put them into the same position as samsung are at the moment