1980 – The world’s first gigabyte-capacity disk drive, the IBM 3380, was the size of a refrigerator, weighed 550 pounds (about 250 kg), and had a price tag of $40,000( $113 thousand in present day terms ), 2.52 GB
1980 – ST-506 first 5¼ inch drive released with capacity of 5 megabytes, cost $1500
Last week, I was contacted by Finis Conner who is best known for his career in the disk industry (more later). I have known Finis since 1980 and we have communicated off an on during this vast expanse of time. We had a drink and talked about the early days of personal computers as well as the future of mobile computing. I have always liked Finis as a person. He has a warm and engaging personality. And he, like me, has dared to put his vision to the test time and time again.
The Story Begins in 1980
This story begins sometime in 1980. I was working at Digital Equipment Corp as a Senior Group Engineering Manager and I was responsible for the low end computer hardware group. I had joined the company in the summer of 1979 when I returned to the United States from Israel. For those that were around and can still remember, my group did the engineering on all Q-bus computers as well as Decmate (word processor).
The Central Engineering organization led (maybe that is too strong a word), by Gordon Bell, had a yearly strategy meeting off site. In those days, such meetings where called “woods meeting” because they happened in either Massachusetts or New Hampshire at some hotel located in a forest area. The senior managers of the Central Engineering Organization would nominate the individuals they thought were the brightest and had the most promise to participate. I was invited to attend. It was a two day event, I think. Outside speakers/presenters were invited.
At this meeting, the legionary Al Shugart spoke. Al had an amazing career spanning 45 years and did more than anyone to create mass storage for personal computer. His career began at IBM (1951) working on Winchester Drive Technology for Mainframes. Later he worked for Memorex, a mainframe disk manufacture. In 1973, he started Shugart Associates which pioneered the floppy disk, first with 8-inch drives and then introducing a 5 1/4 inch in 1976 (the capacity was 87,5k). Al was forced out of his own company in 1974. He moved to Santa Cruz and opened a bar with a friend and bought a fishing boat. Sometime around 1979 Finis got the idea for the 5 1.4 inch drive. His concept was that if you could create a drive in the same form factor as a 5 1/4 inch floppy drive, you could replace one of the two drives that personal computers had with a hard disk. In 1979, he approached Al Shugart with the idea. Together they founded Seagate Technology with only $1,500,000 in venture capital. Seagate went on to become the largest independent manufacture of disk drives.
Back to the Central Engineering Woods Meeting
At that time, I really did not know any thing about disk technology. Digital Equipment had its own disk engineering group run by Grant Saviers and a manufacturing group run by Bob Peffer. I remember that there as a disk called the RL02 which was sold with PDP-11s at that time. It was 10MB. It think it was a 14 inch disk but I am not sure. The disk itself was actually removable which was important. If you had at least two of these units you could back up your disk quickly. Otherwise you had to use DecTape which had a capacity of 258k per tape. Digital, like all computer companies at that time, was pretty much vertically oriented in the sense that it designed, manufactured and sold all the major components including software that made up their computer lines. That meant the company had a memory group, a printer group, a disk group, a terminal group, and an operating system software group. Little did we know at this Woods Meeting, that the structure of the computer industry was about to be turned on its side and Digital would slowly slide into the abyss. I was 35 years old at this time and Al was about 50.
I become one of the first and largest customers for a short time
So Al gets up to talk and educates most of us about disk technology. Then he pulls out a 5-1/4 inch Winchester drive with a capacity of 5 mega bytes that his company was developing. I was blown away with the concept and since I was involved in making small computer systems, my brain lit up with the possibilities. After his talk, almost no one went up to Al. I was surprised at the lack of interest. I went up to him and introduced myself and we chatted for a few minutes. We exchanged business cards and he said he would follow up with me. I think, soon after, I was contacted by someone in his sales organization. A month or so later, I was selected by Ken Olsen to lead the development of personal computers (we did not call them that). Knowing about the 5 1/4 inch disk effected my thinking greatly. Ken wanted me to build a product that only used floppy disks. This was driven by cost factors and because Ken had little understanding of software. I did develop such a product called the Professional 320 but my heart was in a hard disked based product called the Professional 350 which would feature a built in 5 1/4 inch Winchester drive. Both products failed in the market place for many reasons which I have already written about. And in some ways, the IBM PC, which was release a year after I started the CT program (the code name for our effort), proved Ken right but not for long. In 1983, IBM launched the IBM XT which featured a Seagate drive. Apple also used the Seagate drive (but not the electronics) as an option for the Apple III and later the Lisa.
Going outside for a Disk
Soon after Al’s talk, I learned that Digital’s Disk group was developing a competitor to the Seagate drive. It would never had occurred to that group to go outside for a complete drive. I felt that the group would never deliver on time since they started much later than Seagate. So in order to use the Seagate drive, I went to them and pleaded with them to go directly to a 10mega byte drive, committing that I would switch over to their drive as soon as they got it done. I told them that they would leap frog Seagate that way. Later, when Seagate announced their 10 mega byte drive, I persuaded the Desk Group to move directly to 20 mega bytes. You probably have the idea by now that I did not really want to reply on Digital as a supplier. I had to do the same thing with the printer group but that is another story.
I think it is important to stop for a second and pause on the size of this disk. 5MB is less then the memory used for the average photo we take today with a digital camera. The Seagate drive probably cost end users about $2,000 in todays dollars. Today we can buy a terabyte drive which is 200,000 times as large for less than a $100. In other words, it would have cost more than a million dollars to have a mega byte of storage in 1980
Now it cost about ten cents.
Sell, Manufacture and then Design
The drive was not without its problems. While most product development started with design, then went to manufacturing, and then was marketed and sold, Al had reverse this by selling the product, then manufacturing and finally getting around to designing it 🙂 Eventually the product worked as specified.
Seagate Goes Public with my help
Sometime in Aug. of 1981,I got a call from Finis, Al Shugart’s partner asking if I could place an order for something like 1,000 units which was valued at a million dollars. Al wanted the order on the books because the company was going public in about a month. I said I would do my best and was able to get the order processed in time. Of course, such a conversation these days would not be permitted by the SEC. Finish, tells me that he cut a deal with the buyer from Digital at the Crow’s Nest restaurant in Santa Cruz. He wrote out his offer on a napkin and agreed to sell Dec the 5MB drives over three years starting at $525, then $500 and finally $475 in the third year.
The only major company to actually ship the Seagate 5MB drive was Apple. They bought the drive but not the electronics from Seagate and sold about 20,000 units at a list price of $3,499 (they only paid $400 for the drive). Seagate only manufactured 25,000 units that year. Finis deal with Steve Jobs on the Apple product (Steve was not the CEO at that time-Michael Scott was).
Later IBM would become the biggest customer with the introduction of the IBM PC XT. Finis signed the deal with Don Estridge who unfortunitly died in the crash of a Delta flight in Dallas in 1985.
The Pro 350 did not ship until early 1983 much later than originally planed. Just after that, I left Digital to become President of Franklin Computer, an Apple II clone company that did 80 million dollars in sales in its first year of operations before being crushed by Apple in a lawsuit. By April, I was out of Franklin, pushed out but happy to go. We did have a clone of the IBM XT underdevelopment but never released. I saw Finis from time to time at industry meetings. In 1985, he started Conner Peripherals.
Finis goes on to start Conner Peripherals and pioneers the 3 1/2 inch drive
Finis left Seagate and started Conner Peripherals in 1985. Soon after, that company merged with CoData which developed the first 3 1/4 inch disk. The company did very well and had revenues of more than 1.3 billion dollars by 1990 and was eventually acquired by Seagate in 1996. After than Finis started two more companies, Conner Technology which manufacture 3 1/4 inch disk in China but was not successful, and BluStor where Finis is still CEO. Al Shugart died in 2006 at the age of 76.
iPod Changes everything with a 1.8″ drive (2001)
I am not going to go into this now but clearly the introduction of the iPod with a 10 gigabyte hard drive (20 years after Seagate introduced the 5 1/4 inch 5MB drive) was a major discontinuity in the evolution of computing and broke the hold of desktop/notebook computers.
The Future of Disk Capacity and the end of the consumer disk industry
There is no reason to think that disk capacity will not continue to follow Moore’s law and grow exponentially for, lets say, at least the next ten years. I just bought a new Mac which has the new Fusion Drive which combines a one terabyte hard drive with a 256 GB flash memory. In ten years, we could expect to see two orders of magnitude increase. That means I would have a 100 terabyte hard drive and a 25 terabyte flash memory. But what would I do with such a capacity especially since my internet connection will probably be between 100 and 1000 Mbits? Movies are the content that uses the most capacity. An HD movie can be easily compressed into 7 GBs on average. Lets make it easy on ourselves and say that the most we will need for the average movie will be 10 gigabytes. That means we can store a 100 movies in one tera byte or 10,000 movies on the hard disk that I could theoretically have in 2013. But that makes no sense when I will be able to stream any movie from the internet with the same resolution. I would never buy 10,000 movies and even if I was so inclined, I can’t imagine ripping or illegally down loading 10,000 movies (although I have one friend who would try to do this). I certainly could not use up the storage with photos. So what is going to happen? I think consumers will slowly move to all solid state (flash) memory. We will see the consumer hard disk go the way of the tape drive, floppy disk, and optical disk (DVD). There is no longer a disk in any IOS device like the iPhone or iPad. My Macbook Air does not have a hard drive. I am not sure what will happen with the disks the will be used to store things on the cloud.