SSDs: Western Digital Acquires One Startup, Another Gets Funded

Hard drive vendor Western Digital this week completed a $65 million cash acquisition of SiliconSystems, an Aliso Viejo, Calif.-based developer of solid-state drives for embedded systems.

Also this week, Pliant Technology, a Milpitas, Calif.-based developer of enterprise flash drives, said it received $15 million in Series C funding.

Solid-state drives are one of the fastest growing parts of the storage market. Analyst firm IDC last year estimated SSD revenue to grow at a compound annual growth rate of 70 percent through 2012 from a base of $400 million in 2007. SSD shipments during that time are expected to grow 76 percent, IDC said.

SiliconSystems, founded in 2002, is a profitable manufacturer of SSDs with SATA, EIDE, PC card, USB and CF interfaces in 2.5-inch, 1.8-inch, CF and other form-factors.

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Prior to the acquisition, Western Digital did not have an SSD business, a company spokesperson said.

For Western Digital, the acquisition gives it a chance to quickly enter the SSD market, a move several traditional drive companies, such as archrival Seagate, and nontraditional drive companies, such as Intel, have already made.

John Coyne, president and CEO of Western Digital, said in a statement, "SiliconSystems' intellectual property and technical expertise will significantly accelerate WD's solid-state drive development programs for the netbook, client and enterprise markets, providing greater choice for our customers to satisfy all their storage requirements."

Western Digital said SiliconSystems will operate as its solid-state storage business unit.

For Pliant, which said it began delivery of its initial enterprise flash drives to major OEMs late last year, the new $15 million in venture capital funding gives it working capital to support volume production ramp-up of its first products.

The company is developing drives with the Serial Attached SCSI (SAS) interface.

There has been a flurry of activity in the past year or so as storage vendors start looking seriously at the potential of solid-state drives in the enterprise market.

Samsung Electronics in January entered the enterprise solid-state drive market with a line of 100-GB drives featuring high-performance single-level cell (SLC) memory technology that is optimized for performance and data reliability.

Hitachi GST and Intel said in December that they had agreed to jointly develop enterprise-class solid-state hard drives. They are collaborating to develop drives featuring SAS and Fibre Channel interfaces aimed at the enterprise data center market, and plan to have drives in OEM qualifications early next year.

Intel in October introduced a line of solid-state drives based on the SATA interface for the server, workstation and storage system market. Those 32-GB drives followed the introduction earlier last year of solid-state drives for the PC and notebook markets.

Other vendors, including Seagate, Samsung, Toshiba and SanDisk, also are offering solid-state hard drives.