Hard Drive Shortage Nails Industry (i.e., stupid greedy CEO's)

[Beck38]

As if it wasn't apparent to everyone just about now, the idea of chasing Slave Labor markets in the far east for the production of hard drives is beginning to come home to roost.

http://www.tomshardware.com/news/HDD-IDC-shortage-supply-thailand,14232.html

http://www.zdnet.com/blog/btl/intel-cuts-sales-outlook-blames-hard-drive-shortage/65179

Tons more....

will any of these CEO's see their christmas bonuses cut or disappear because of their stupidity?

oh.... nooo......!

Of course, they see platinum lining in that they can now sell more SSD's which are closer in price to the mechanical types as their prices (the mechanical) have jumped some 2-400%.

[clocker]

Hmm, what a conundrum.
Do you want to do away with "slave labor" or be able to buy a TB drive for $59.95?

BTW, Intel says it has NOT seen an increase in SSD sales because of the drive shortage.

[Beck38]

They can produce the drives at that level right here in America, right where I'm sitting, employing Americans whose hourly wage is certainly more, but whose output is far greater and with a fraction of the error rate.

Intel, as a matter of fact, hasn't 'bought into' this 'chasing of low-wage/slave labor' markets to produce their product, and are currently building the world's largest FAB plant just down the road from me in Oregon.

One of my first employers, Texas Instruments, at the time the world's largest chip maker (way back in the 1970's), started chasing low-wage/slave labor markets at about that same time, building plants in Thailand, the Philippians, and elsewhere around Asia, 'off-shoring' as much production as they could. Oh yes, they could build it cheap, but the 'bad build' rate was horrendous; they had to produce 2-3 times has much to get the same yield as a US plant, and spent (of course) a huge amount on finding those bad parts. When they tried to cut back testing, so many bad parts 'leaked' through to their customers, they soon got a VERY bad reputation, and to put it bluntly, their competition ate their lunch.

They are now, 30+ years later, still trying to recover from the off-shoring mania that gripped them so tightly, initially the darling of Wall St and ballooning stock prices, to an 'also-ran' company. Other companies of that era (the 70's) are in the same boat lurching along, if they still exist (auto industry, anyone?)

Just recently, another industry in the Pacific Northwest tried the 'out/offshore outsourcing' scheme to build an airplane, the Boeing 787. Even though a fair amount was done in the US, it was in areas of the country with a labor force of poor education and skills (the 'south'), as well as foreign suppliers, and led to a more than three year delay as parts came into the assembly plant 'out of spec' and needing large amount of time/money to rework them. This has resulted in the 'break even' point of the entire aircraft to shift toward the 1000-plane mark, i.e., they will have to build at least that number before actually seeing any profit, some 6+ years from now (if they're lucky).

This nonsense has NEVER worked. It's the 'trickle down' form of economics applied to goods production. A highly educated, highly skilled workforce will ALWAYS beat those that aren't, even on what at first appears to be a simple product (to our eyes). Only those looking for a 'quick buck' will profit from such thinking, everyone else (from the workers to the buyers) get the shaft.

[clocker]

If your claims of American manufacturing superiority are true, then why are companies outsourcing to the Far East?
Clearly, the fragile supply chain and higher reject rate don't outweigh the lower costs ...or they'd all be building factories in the Pacific Northwest, right?

The "quick buck" is the ONLY thing corporations care about.
Quality, reputation, customer goodwill...all meaningless.
Profit trumps everything.

[mjmacky]

If your claims of American manufacturing superiority are true, then why are companies outsourcing to the Far East?
Clearly, the fragile supply chain and higher reject rate don't outweigh the lower costs ...or they'd all be building factories in the Pacific Northwest, right?

The "quick buck" is the ONLY thing corporations care about.
Quality, reputation, customer goodwill...all meaningless.
Profit trumps everything.

I got the impression that Beck is thinking along the same lines, only interjecting his opinion that they wouldn't run into some of their many issues if they assembled domestically (to point out the short-sightedness of their actions). High level assembly still takes place in the U.S., then those parts are shipped overseas for the final assembly. I think we all know profit is bottom line, shafting employees and anyone else low in the chain is the main modus operandi for that directive.

[Artemis]

Of course we are overlooking the ACTUAL reason for the hard drive shortage here, an act of god in the form of torrential floods which damaged the factories and halted production. Acts of god can happen anywhere, and in fact the U.S. has more than its fair share of natural disasters, having an educated workforce doesn't really help when the workplace is underwater. Many of these 'poorer' less educated countries have a far better response to disaster than the U.S. has demonstrated.

[zot]

Many of these 'poorer' less educated countries have a far better response to disaster than the U.S. has demonstrated.
Let's not confuse technology (or lack of) with outright political corruption ... like George Bush appointing his country club buddies to run federal agencies despite having zero experience, people who couldn't care less about the actual job and valued their vacation time above all else.

[mjmacky]

people who couldn't care less about the actual job and valued their vacation time above all else.

When you put it that way, I'm not sure I would have done a much better job. Vacation time is awesome.

[zot]

people who couldn't care less about the actual job and valued their vacation time above all else.

When you put it that way, I'm not sure I would have done a much better job. Vacation time is awesome.
But let's not forget that the work-ethic that president set for himself and his friends was the total opposite of what he demanded for grunts in the military. Canceled leave, back-to-back tours-of-duty, retroactive stop-loss, and other nasty surprises. A policy signed off by someone who spent nearly as many "work" days relaxing at his Texas ranch as he did on the job.

[megabyteme]

Of course we are overlooking the ACTUAL reason for the hard drive shortage here, an act of god in the form of torrential floods which damaged the factories and halted production. Acts of god can happen anywhere, and in fact the U.S. has more than its fair share of natural disasters, having an educated workforce doesn't really help when the workplace is underwater. Many of these 'poorer' less educated countries have a far better response to disaster than the U.S. has demonstrated.

This. The quality of the Taiwanese electronics, and tool manufacturing, is some of the highest quality/lowest price available anywhere. They now have highly-skilled, knowledgeable people working in these plants. It was flooding of the plants, themselves, that has brought about the supply "shortages". Although, I have not seen the kind of price increases the fear-mongers were talking about...

[bijoy]

More bad news: seagate & WD are going to reduce their warranty period to 1 year.

Link: there are too many links. Just google.

[koolfaze]

I thought seagate and WD were reducing warranty by 1 year. Hard drive prices have started to decrease compared to a few months ago.

[MikeB]

new drives or existing drives?