back to article China's STILL holding up the full WD-HGST integration. Why?

WD's buyout of HGST took place in 2012. MOFCOM, China’s Ministry of Commerce – here concerned with competition – said it was delaying its approval for two years. During that time, HGST and WD had to be run as two separate businesses subject to strict conditions. Those conditions were: Maintenance of HGST at pre-transaction …

  1. Anonymous Coward
    Anonymous Coward

    I'm with China on this one, not enough competition in the HDD market to keep a lid on prices.

  2. Anonymous Coward
    Anonymous Coward

    eating your cake

    Let me get this straight: the gods of vulture capitalism are upset because, having transferred most of the West's industrial capacity to China, they find the Chinese actually acting in the best interests of their own domestic workers by stonewalling a mega merger -- who understandably would be quite upset at losing their jobs due to Western-style M&A "workforce reorganization".

    The whole "we're paying more so they can pay less" argument is an interesting one, given that it seems to be based on the assumption that consolidation leads to greater efficiency than competition. Instead of a vibrant marketplace full of merchants driven to efficiency by competition, it seems to propose a few very large private corporations whose operations, although protected by sovereign national governments, are not subject to regulation by them.

    Frankly, I think the Chinese took the coward's way out here. Instead of delaying this merger to death they should have outright denied it. There's no way that an end game where China is pitted against a few very large and powerful corporations is going to benefit either the Chinese people or their leadership (a leadership whose lives ultimately depend on not driving their people to revolt).

  3. Tannin

    Who wrote this? A Western Digital employee? Or just someone cutting and pasting from a company press release? It is an absurd nonsense to pretend that reducing competition even further would lower prices. Good for China! Nice to see that someone (for whatever reason) is acting in the interests of consumers and businesses the world over instead of spinelessly caving in to oligopoly.Damn shame that none of our own governments have the balls to do their duty.

    1. unitron

      It isn't about reducing (or not) competition, it's about reducing overhead for the merged entity that used to be separate companies WD and HGST.

      If the cost of being in business is lower, they can better compete with Seagate on price.

      (whether *anyone*--WD, Seagate, Toshiba, Fujitsu, Samsung, HGST--anyone, in all of this will actually be producing better drives is a separate issue)

      1. Alan Brown Silver badge

        "it's about reducing overhead for the merged entity that used to be separate companies WD and HGST."

        And the resistance is about preventing HGST reliability fall to WD levels (they will), or that there would effectively be only 2 makers of commodity HDDs worldwide(*), both of whom are scaling back on warranties at the same time as reliability is plummeting and who are both increasingly reliant on the same single-sources for components.

        If I was the chinese I'd be holding this line until SSDs are cheap enough that they're giving spinning media some real competition. It's almost there.

        The HDD market in the last 5 years (Since the Thai Floods) looks amazingly like the RAM market did in the 5-10 years following the 1992 Sumitomo Fire and for much the same reason - futures traders got in on the action and screwed up a technical market in their pursuit of limitless profit.

        The difference between then and now is that unlike RAM (where multiple fabs and plastics makers were able to come onstream and kill the market manipulators), HDDs are mechanically fiddly and not easy to fabricate - platters almost all come from one source, heads from another. The answer is more solid-state storage and that's happening, although not quite as fast as some of us had envisaged (3D fabs will probably change that daramatically).

        (*) Toshiba aren't shipping enough to affect prices.

  4. mathew42

    With storage devices, I'm typically more concerned about reliability and just possibly given the 3TB failure rate Seagate might want to consider employing some more people in their QA team.

    1. Anonymous Coward
      Anonymous Coward

      I read about those, pretty horrific and made the old deskstars look failure proof.

      1. Anonymous Coward
        Anonymous Coward

        Wow so OCZ (pre Toshiba) failure type rates then.

    2. Anonymous Coward
      Anonymous Coward

      That's a one-eyed point of view. Ever taken a look at the failure rate of WD's green drives? Makes those Seagates look positively reliable in comparison.

      The truth is that every drive manufacturer has had some lemons, but in every thread on this issue there is always at least one Seagate-basher. Please understand that WD have made some real stinkers in the past, and currently hold the crown for least reliable consumer grade HDD.

      1. unitron

        The only brands of drives at least one of which I haven't had go bad on me are the ones I never owned.

      2. Alan Brown Silver badge

        "WD have made some real stinkers in the past, and currently hold the crown for least reliable consumer grade HDD."

        BOTH are crap compared to the reliability of current consumer SSDs (OCZ was an abberation).

        HDD failure rates at $orkplace run at least 10-15 times that of SSDs and we're not alone in experiencing that.

      3. N13L5

        Re: in every thread on this issue there is always at least one Seagate-basher

        And at least one WD basher :p

        You know internet forums are full of paid shills anyway.

        But it doesn't matter if Seagate bashers and WD bashers find an equilibrium in forum threads...

        The annoying part is, that both do it without a shred of evidence, or anecdotal evidence at best.

        The only people who do meaningful testing in companies that actually use enough drives to have any statistical relevance immediately get picked appart by people paid by whoever had the highest failure rates.

        Or its said that drive testing in a corporate environment has no bearing for consumers, since they are not heavy users.

        According to any real data I've seen past and present (been in the business since 1987) and the massive differences between actual drive models from the same manufacturer, if I had to make a purchasing choice by brand alone without knowing the history of a particular drive model, I'd go for HGST first, anything still bearing the Samsung brand second, Toshiba third, WD forth and Seagate last.

        Now I won't buy drives without knowing something about them, so in reality, choice isn't so much by brand, but still influenced by the brand's customer support and warranty details.

    3. K

      "the 3TB failure rate"

      Thats a great shame, was considering upgrading. I've been running some of their older 1.5TB 5400RPM green drives in my NAS, all advise said don't do it, but these things have been spinning for 5 years without a failure (touch wood).

      1. Alan Brown Silver badge

        You'd be leaping from frying pan to fire.

        The only thing with comparable failure rates to 3Tb drives (WD and Seagate both) have been 1.5Tb drives.

  5. TrevorH

    Or perhaps they've seen the failure figures for both companies drives and want to retain one company that makes stuff that works.

  6. asdf


    I guess I should go research it but why the hell didn't WD back out as soon as China started putting conditions on in the first place? If they were stupid enough to have allowed a poison pill payout if the M/A didn't happen with a Chinese company then the share holders need to be getting rid of some board members.

  7. Brian Allan 1

    Regardless, I'll pay more for WD drives. Seagate drives may be less $$$'s but are terrible quality!

    1. Anonymous Coward
      Anonymous Coward


      Samsung or Intel is more like it. Oh you still buy spinning rust?

      1. Paul Crawford Silver badge

        Re: hmm

        Some of us cant afford 10TB in SSD

        1. Alan Brown Silver badge

          Re: hmm

          5 times the price (and falling fast), 5-10 times the warranty (not that you'll need to claim on it much)

          If you can afford the upfront costs it's a no-brainer.

    2. David Austin

      All depends on the drive family.

      I've stayed away from the entry level consumer drives (WD Blue, Barracuda) since both Seagete and Western digital would only warranty them for a year, which should tell you all you need to know about the quality and expected failure rate.

      While the Seagate Constellation drives are just as good, but WD Black's are that little bit cheaper and easier to find.

      1. unitron

        WD Blacks are easy to find.

        If you have thermal imaging equipment.

      2. Alan Brown Silver badge

        "While the Seagate Constellation drives are just as good"

        Our in-warranty failure rate on Constellations stands at 180% (yup, that means replacements for failed drives have themselves failed and we've replaced _every single_ constellation drive in our raid arrays at least once.)

        1. Anonymous Coward
          Anonymous Coward

          Re: "While the Seagate Constellation drives are just as good"

          That's funny...

          Of course, you only get refurb drives as replacements anyway...

          Seagate doesn't only make bad drives, they're also dishonest.

          After advertising Barracuda drives with their "Power of One" claim - meaning 1 TB per platter, it turns out they were also selling Barracudas with 3 platters of 667 MB, with identical model number and no way for customers to tell what they were getting.

          You had to weigh the damned things to figure out if you got what you paid for or if you got screwed with the output from an older plant (compared to the models they sent to reviewers), cutting speed by a third, running hotter and having lower reliability.

          I'd call that fraud.

          Just out of principle, I wouldn't buy from that den of thieves

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