Flash storage solutions provider SanDisk (NASDAQ:SNDK) closed its third-quarter earnings on a happy note, and is now working hard to maintain the same momentum in the last quarter of the fiscal year. Let’s take a look at how SanDisk is preparing itself to counter the increasing competition while working on adopting new technologies.
SanDisk Is Growing with SSDs
Last week, Asian PC-maker ASUTeK Computer or ASUS introduced its latest ultrabook, ZENBOOK UX301LA that features SanDisk’s two X110 Solid state drives (SSDs). The SSDs will enhance processing speed, application launch and data transfer, and reduce boot-up and shut-down time. SanDisk rolled out X210 SSDs few months back and currently has A110, X110 and U110 series of SSDs under its sleeves.
The SSDs mark the sweet spot in the broader storage market. The main features that make the SSD popular over the traditional hard disk drive are its speediness, flexibility and reliability. Even the big data analytics, which entail huge data-mining and mammoth storage operations, will be better addressed with cost-effective SSDs.
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The growing opportunity is attracting key storage vendors to explore this market. Disk-drive manufacturers Seagate (NASDAQ:STX) and Western Digital (NASDAQ:WDC) have pushed their offerings into the market. Western Digital acquired two SSD companies, STEC and Virident in 2013, to keep itself ahead of its peers. Also, it is the first to unveil a dual drive, WD Black2, which features both the SSD and HDD capabilities. The initiatives clearly show Western Digital’s urge to conquer the SSD space.
SanDisk, too, has been showering money to grow its market share. It acquired SMART Storage Systems in July 2013, FlashSoft in February 2012 and Pliant Technology in May 2011 to boost its SSD portfolio. At its analyst meeting held in May 2013, the company announced its plans to generate nearly 35% contribution from the SSD portfolio by 2016.
With increasing need for mobile computing and data center operations, SanDisk’s SSD offerings could bring in more revenue for the company.
Focusing on Next-Gen Technologies
Continuous upgrades/changes and innovations best describe the technology sector; how can SanDisk be an exception? In addition to exploring the SSD space, the company is also working hard to develop software defined storage (SDS), which is a recent trend in the enterprise storage space that could have a considerable impact on the next-generation data center operations. SDS has been evolved to simplify and automate the storage operations by reducing hardware dependency.
SanDisk has partnered with Nexenta Systems, a dedicated software-defined storage solutions provider, to make a mark in the growing data center market and the enterprise storage sector. SanDisk’s upcoming flash storage line-ups will combine Nexenta’s competence that would optimize data management and processing time and reduce cost of hardware acquisition. Industry experts are overtly positive on the growth of SDS, and SanDisk is believed to be in the right direction for a bigger market share.
SanDisk is also upgrading its flash memory technology from two-dimensional NAND architecture to three-dimensional architecture. The company’s next upgrade could be three-dimensional resistive RAM (ReRAM) technology, which will succeed three-dimensional NAND technology.
Although SanDisk’s focus on adopting next-gen technologies is encouraging, concerns about market share growth will co-exist. South Korea-based computing and electronics vendor Samsung Electronics has already started mass production of its three-dimensional NAND memory chips, which will be marketed any time soon. SanDisk will be a late entrant whose success will depend on its product superiority.
Distribution Strategy Is in Place
Apart from developing new technologies, SanDisk is keeping itself updated with its product distribution strategy. Last month, the flash-storage solutions provider sealed a distribution agreement with Avnet (NYSE:AVT), a global distributor of electronic and technological goods. This would make SanDisk’s products easily available across North America, Europe, the Middle East and Africa (EMEA), Asia Pacific and Latin America.
Competition in the storage space is heating up, and continuous technological inventions are critical for any company’s success. With new product offerings that match the industry trend, technology upgrades and a well-planned distribution strategy, SanDisk has the ability to beat the heat.