Data Backup Digest

The Internet of Things has meant that the amount of data we’re producing is increasing exponentially. Even common household appliances like washers, fridges, and watches can now produce their own data. This data about our personal lives is being collected and then being analysed, supposedly to make things more efficient and easier for us.

The problem is, there’s not enough storage to cater for all this data. That’s where companies like Seagate hope to benefit.

Seagate are a huge player in the data storage game. They research, manufacture and distribute data storage technology and solutions to both personal and business consumers. Seagate continues to expand in the industry because of their huge investments into research and development, plus the growing storage needs.

Ove the last ten years, storage manufacturers have struggled to meet data demands. Last year there was a demand for 30,800 exabytes worth of data and only 19,800 exabytes of storage were supplied. That’s 43% of data being not being catered for. This year, that gap is expected to rise to 53%.

This offers huge potential for Seagate who own a large part of the data market. In the enterprise space, the largest share is owned by Western Digital, who have 46%, but Seagate aren’t far behind with 41%. That’s impressive considering the third competitor is Toshiba with 13.3%.

Seagate are also in a good position because they serve customers from all over, with different capacity and types of drives (like those for the server industry). Business can choose between versatile, speed optimised, durable and smart secured storage devices. Many of Seagate’s competitors don’t offer such a wide range, meaning the company are in a good position to maintain the market share and gain through organic growth.

You may think that the growing storage demand means that Seagate’s profit lines will automatically grow too. However, competition has increased within the industry too, and it’s become easier to produce the drives, and so prices have fallen. So, while there might be more sales, it’s at a reduced rate.

That said, despite relatively flat revenue, Seagate’s net profits are growing. This is because they have managed to tame their research and development costs and lower their administrative expenses. From 2016 to 2019, net income has grown from $248 million to $2.01 billion.

Those looking for a storage company to invest it would be wise to go with Seagate for the long-term investment. Not only is growth happening currently, but there’s huge potential for more of it too. The Internet of Things isn’t going away – more devices are getting connected, are going to be producing higher quantities of data, and are also producing larger files too.

That said, many large technology firms are pushing for the next innovation in data. Storing on glass and DNA are two of the many methods being considered. For now, though, it doesn’t look like traditional hard drives are going away any time soon, and SSDs are now becoming increasingly affordable for the average consumer too.