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                                                                    EXHIBIT 10.1

                              EMPLOYMENT AGREEMENT

        This Employment Agreement (the "Agreement") is entered into by and
between Western Digital Corporation (the "Company") and John Coyne
("Executive"), as of the 31st day of October, 2006 ("Effective Date").

        1. EMPLOYMENT.

        The Company hereby employs Executive and Executive hereby accepts such
employment, upon the terms and conditions hereinafter set forth including but
not limited to provisions governing early termination, from the Effective Date
to and including January 1, 2012 ("Employment Period"). Unless Executive's
employment is terminated pursuant to any early termination provision hereof or
the parties mutually agree otherwise in writing, Executive's employment with the
Company shall terminate without further action by either party on January 1,
2012.

        2. DUTIES.

                A. President and Chief Operating Officer. From the Effective
Date until January 1, 2007, Executive shall continue to serve as President and
Chief Operating Officer of the Company, and shall report to the Company's Chief
Executive Officer.

                B. President and Chief Executive Officer. From January 2, 2007,
through January 1, 2012, Executive shall serve as President and Chief Executive
Officer of the Company. In this capacity, Executive shall report to the Board of
Directors of the Company, and shall have such duties and responsibilities
consistent with his position as President and Chief Executive Officer as the
Board of Directors of the Company shall determine from time to time.

                C. Executive Commitment. Executive agrees to devote
substantially all of his time, energy and ability to the business of the
Company, subject to paragraph E of Section 3.

        3. COMPENSATION.

                A. Base Salary. From the Effective Date through January 1, 2007,
the Company will pay to Executive a base salary at the rate of $650,000 per
year. Effective January 2, 2007, the Company will pay to Executive a base salary
at the rate of $800,000 per year. Such salary shall be earned monthly and shall
be payable in periodic installments in accordance with the Company's customary
practices. Amounts payable shall be reduced by standard withholding and other
authorized deductions.

                B. Bonus. Executive's target annual bonus each fiscal year
during the Employment Period for purposes of the Company's semi-annual Incentive
Compensation Plan (ICP) bonus program for such fiscal period shall be 100% of
his semi-annual base salary from the Company in effect on the last day of such
fiscal period. In addition, concurrent with the execution of this Agreement,
Executive shall receive a Performance Cash Award, in the form attached hereto as
Exhibit "A" that provides an opportunity for



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a bonus with a target amount of $1,000,000 for the July 1, 2006, through June
29, 2007, performance period and shall receive a Performance Cash Award in the
form attached hereto as Exhibit "B" that provides an opportunity for a bonus
with a target amount of $1,000,000 for the July 1, 2006 through June 27, 2008
performance period, the corresponding performance objectives to be determined by
the Compensation Committee of the Board of Directors in its good faith
discretion. In addition, while employed by the Company under this Agreement,
Executive shall be eligible for and shall receive a Performance Cash Award
annually under the Company's Long Term Incentive award program with a target
amount of no less than $2,000,000. Each such award will be based on a 24-month
performance period. The first such Performance Cash Award will be awarded in
August or September 2007, and will be based on the performance period commencing
on the first day of fiscal year 2008 and ending on the last day of fiscal year
2009. The parties intend that the performance objectives for such annual awards
will be determined each year by mutual agreement between Executive and the
Compensation Committee of the Board of Directors following good faith
discussions and consideration of the Company's strategic and operational
initiatives. In the event that the parties cannot reach mutual agreement, the
performance objectives for the applicable award will be determined by the
Compensation Committee in its good faith discretion. The other terms and
conditions of such awards will be in the Company's standard form attached hereto
as Exhibit "A".

                C. Retirement and Welfare Benefit Plans; Fringe Benefits.
Executive (and, in the case of welfare benefit plans, his eligible dependents,
as the case may be) shall be eligible for participation in the retirement,
welfare, and fringe benefit plans, practices, policies and programs provided by
the Company on terms consistent with those generally applicable to the Company's
other senior executives and approved by the Compensation Committee of the Board
of Directors.

                D. Expenses. Executive shall be entitled to receive prompt
reimbursement for all reasonable employment expenses incurred by him in
accordance with the policies, practices and procedures as in effect generally
with respect to other senior executives of the Company.

                E. Vacation and Other Leave. From the Effective Date through
December 31, 2009, Executive shall receive paid vacation in an amount determined
by the Company's then-existing policies based upon Executive's years of service
with the Company. For each of calendar year 2010 and 2011, Executive shall
receive eight (8) weeks paid vacation. Such vacation shall be scheduled and
taken in accordance with the Company's standard vacation policies applicable to
Company executives. Executive shall also be entitled to all other holiday and
leave pay generally available to other executives of the Company.

                F. Modification. The Company reserves the right to modify,
suspend or discontinue any and all of the above plans, practices, policies and
programs at any time without recourse by Executive so long as such action is
taken generally with respect to other senior executives of the Company and does
not single out Executive.



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        4. RESTRICTED STOCK; OTHER EQUITY AWARDS.

                A. Restricted Stock Units. On January 31, 2007, the Company
shall grant to Executive an award of 1,100,000 restricted stock units
("RESTRICTED UNITS") in the form attached hereto as Exhibit "C" provided that
Executive is then employed as the President and Chief Executive Officer of the
Company. Such Restricted Units shall vest as follows: (i) Ten percent of such
Restricted Units shall vest on January 1, 2008; (ii) Ten percent of such
Restricted Units shall vest on January 1, 2009; (iii) Thirty percent of such
Restricted Units shall vest on January 1, 2010; (iv) Ten percent of such
Restricted Units shall vest on January 1, 2011; and (v) Forty percent of such
Restricted Units shall vest on January 1, 2012; provided, in the case of each
such vesting installment and except as expressly provided otherwise in Section 5
below, that Executive has remained continuously employed by the Company through
such vesting date. In the event of Executive's death after January 31, 2007,
while employed by the Company, an additional number of Restricted Units shall
accelerate and become vested on the date of Executive's death, with such number
of additional Restricted Units equal to: (1) the total number of Restricted
Units multiplied by a fraction (not greater than one), the numerator of which is
the total number of calendar days during the period commencing with January 31,
2007, through and including the date of Executive's death, (but not less than
182 days) and the denominator of which is the total number of calendar days
during the period commencing with January 31, 2007, through and including
January 1, 2012, less (2) the total number of Restricted Units that otherwise
vested on or before the date of Executive's death. The Restricted Units will be
evidenced by and subject to such other and further terms and conditions as are
set forth in a written restricted stock unit award agreement in the form
attached hereto as Exhibit "C".

                B. Stock Options. On January 31, 2007, and in each of the four
fiscal years commencing with fiscal year 2008, the Company shall grant to
Executive a nonqualified stock option (the "Option(s)") to purchase a number of
shares of Common Stock in the form attached hereto as Exhibit "D". The date of
the Option grants subsequent to January 2007 shall be at the same time as the
Company's annual grant of options to other members of senior management. If the
Company is in a blackout period (pursuant to the Company's policies on trading
Company securities applicable to the Company's executive officers generally) on
the applicable date, the Compensation Committee of the Board of Directors may,
in its discretion, delay the date of grant of the applicable Option until after
such blackout period ends, in which case the Compensation Committee shall
approve the grant promptly following the end of such blackout period (and the
date of grant of the Option shall be the date of such approval). The number of
shares of Common Stock subject to the January 31, 2007 Option will equal 120,000
(such number subject to proportionate and equitable adjustments for stock
splits, stock dividends, reverse stock splits, and similar changes in
capitalization). The number of shares of Common Stock subject to the subsequent
Options will be determined in the good faith discretion of the Compensation
Committee of the Board of Directors based on (among such other facts and
circumstances the Compensation Committee may determine to be relevant in the
circumstances) Executive's individual performance, the Company's performance,
and market benchmark comparisons of compensation data for chief executive
officers against both peer group and general industry survey data. The exercise



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price per share of the Option(s) will be equal to the fair market value
(determined consistently with the Company's Amended and Restated 2004
Performance Incentive Plan) of a share of Common Stock on the date of grant of
the Option(s). The Option(s) will be evidenced by and subject to such other and
further terms and conditions as set forth in a written stock option award
agreement in the form attached hereto as Exhibit "D".

                C. Future Award Eligibility. Executive shall also be eligible to
receive additional grants of stock options, restricted stock awards, and/or
other long-term incentives, each in the good faith discretion of the
Compensation Committee of the Board of Directors based on (among such other
facts and circumstances the Compensation Committee may determine to be relevant
in the circumstances) Executive's individual performance, the Company's
performance, and market benchmark comparisons of compensation data for chief
executive officers against both peer group and general industry survey data.

                D. Special Incentive Vesting and Exercisability. In the event
Executive remains employed by the Company as its President and Chief Executive
Officer through January 1, 2012, following the termination of Executive's
employment with the Company (regardless of the reason, other than a termination
by the Company for Cause (as defined in Section 5)), Executive will (i) be fully
vested in any stock options granted to him by the Company during the Employment
Period and Executive will have three years from the date of such termination to
exercise such stock options (subject to earlier termination on the expiration of
the maximum applicable term of such stock options or, as provided in the
applicable agreement evidencing such options and the equity incentive plan of
the Company under which they are granted, the occurrence of a change in control
of the Company and similar events) and (ii) be eligible to receive a pro-rata
portion of any outstanding Performance Cash Award equal to the amount that
Executive would have been entitled to had he continued to be employed through
the applicable payment date, multiplied by a fraction the numerator of which is
the number of days in the performance period that Executive was employed by the
Company and the denominator of which is the total number of days in the
performance period. Any such payment(s) shall be made at the same time as
amounts are paid generally with respect to the applicable performance period.

        5. TERMINATION.

                A. Death. This Agreement and Executive's employment shall
terminate automatically on the death of Executive.

                B. Disability. The Company, at its option, may terminate
Executive's employment upon the Disability of Executive. For purposes of this
Agreement, "Disability" shall mean physical or mental incapacity that renders
Executive unable to perform the normal and customary duties of employment of
Executive even with a reasonable accommodation for (A) 120 days in any twelve
(12) month period or (B) for a period of ninety (90) successive days.



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                C. Cause. The Company may terminate Executive's employment for
Cause. For purposes of this Agreement, "Cause" shall mean that the Company,
acting in good faith based upon the information then known to the Company,
determines that Executive has engaged in or committed: (i) willful misconduct,
(ii) fraud, (iii) failure or refusal to perform the duties of Chief Operating
Officer and President prior to January 2, 2007, or President and Chief Executive
Officer on or after January 2, 2007, as the case may be, or (iv) a conviction of
or a plea of nolo contendre to a felony.

                D. Other than Cause, Death, or Disability. The Company may
terminate Executive's employment at any time, with or without cause, upon 30
days' written notice.

                E. Obligations of the Company Upon Termination.

                        (i) Cause or Disability. If Executive's employment is
terminated by the Company for Cause or on account of Disability, Executive's
employment shall terminate without further obligations to Executive other than
for the timely payment of the sum of (i) Executive's annual base salary through
the date of termination to the extent not theretofore paid and (ii) any
compensation previously deferred by Executive in accordance with the Company's
deferred compensation plans (together with any accrued interest or earnings
thereon pursuant to the terms of the applicable plan) and any accrued vacation
pay, in each case to the extent not theretofore paid (the sum of the amounts
described in clauses (i) and (ii) shall be hereinafter referred to as the
"Accrued Obligations"). If it is subsequently determined that the Company did
not have Cause for termination under Section 5.C or Executive was not Disabled
as defined in Section 5.B, then the Company's decision to terminate shall be
deemed to have been made under Section 5.D, and the amounts payable under
Section 5.E(iii) shall be the only amounts Executive may receive for his
termination.

                        (ii) Death. If Executive's employment is terminated on
account of Executive's Death, Executive's employment shall terminate without
further obligations to Executive's heirs other than for the timely payment of
Accrued Obligations and the adjusted vesting of Restricted Units set forth in
Section 4.A above.

                        (iii) Other than Cause, Death, or Disability. If the
Company terminates Executive's employment for other than Cause (and other than
due to Executive's death or Disability) effective prior to January 1, 2012,
Executive's employment shall terminate without further obligations to Executive
other than:

                                (a) The Company's timely payment to Executive of
Accrued Obligations; and

                                (b) The Company's provision to Executive of the
Tier I benefits under the Company's then-existing Executive Severance Plan or,
if applicable, the benefits under the Company's Amended and Restated Change of
Control Severance Plan, provided that Executive satisfies all of the terms and
conditions of the applicable



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plan (including in the case of the Executive Severance Plan, but not limited to
the condition that Executive execute a general release in a form acceptable to
the Company).

                                (iv) Expiration. Upon the expiration of this
Agreement, Executive's employment shall terminate without further obligations to
Executive other than (i) the timely payment of Accrued Obligations, (ii) any
benefits or amounts due under Section 4(D) above, and (iii) eligibility to
receive an ICP bonus with respect to the first half of fiscal year 2012 in such
amount and at such time as ICP bonuses, if any, are determined on a Company-wide
basis.

                F. Exclusive Remedy. Executive agrees that the payments and
benefits contemplated by this Agreement shall constitute the exclusive and sole
remedy for any termination of his employment, and Executive covenants not to
assert or pursue any other remedies, at law or in equity, with respect to any
termination of employment.

        6. CONFIDENTIALITY AND INVENTION.

        Executive has previously executed an Employee Invention and
Confidentiality Agreement ("Invention Agreement"), dated March 3, 1997, which is
incorporated herein as if fully set forth. In the event of an inconsistency
between a provision of this Agreement and a provision of the Invention
Agreement, the provision of this Agreement controls.

        7. NON-INTERFERENCE.

        Executive promises and agrees that during the term of this Agreement,
and for a period of twenty-four (24) months thereafter, he will not influence or
attempt to influence any customer, supplier, or distributor of the Company to
alter or reduce its business relationship with the Company.

        8. LITIGATION ASSISTANCE.

        Executive agrees to cooperate with the Company in any actual or
threatened litigation that arises against or brought by the Company at any time
during or after the Employment Period, including but not limited to
participating in interviews with the Company's counsel to assist the Company in
any such litigation.

        9. ARBITRATION.

        Any controversy arising out of or relating to Executive's employment,
this Agreement, its enforcement or interpretation, or because of an alleged
breach, default, or misrepresentation in connection with any of its provisions,
shall be submitted to arbitration in Orange County, California, before a sole
arbitrator selected from Judicial Arbitration and Mediation Services, Inc.,
Orange County, California, or its successor ("JAMS"), or if JAMS is no longer
able to supply the arbitrator, such arbitrator shall be selected from ADR
Services, Inc., and shall be conducted in accordance with the provisions of
California Civil Procedure Code Sections 1280 et seq. as the exclusive remedy of
such dispute; provided, however, that provisional injunctive relief may, but
need not, be



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sought in a court of law while arbitration proceedings are pending, and any
provisional injunctive relief granted by such court shall remain effective until
the matter is finally determined by the Arbitrator. Final resolution of any
dispute through arbitration may include any remedy or relief which the
Arbitrator deems just and equitable. Any award or relief granted by the
Arbitrator hereunder shall be final and binding on the parties hereto and may be
enforced by any court of competent jurisdiction. The parties agree that they are
hereby waiving any rights to trial by jury in any action, proceeding or
counterclaim brought by either of the parties against the other in connection
with any matter whatsoever arising out of or in any way connected with this
Agreement or Executive's employment.

        10. SUCCESSORS.

                A. This Agreement is personal to Executive and shall not,
without the prior written consent of the Company, be assignable by Executive.

                B. This Agreement shall inure to the benefit of and be binding
upon the Company and its successors and assigns and any such successor or
assignee shall be deemed substituted for the Company under the terms of this
Agreement for all purposes. As used herein, "successor" and "assignee" shall
include any person, firm, corporation or other business entity which at any
time, whether by purchase, merger or otherwise, directly or indirectly acquires
the stock of the Company or to which the Company assigns this Agreement by
operation of law or otherwise.

        11. WAIVER.

        No waiver of any breach of any term or provision of this Agreement shall
be construed to be, nor shall be, a waiver of any other breach of this
Agreement. No waiver shall be binding unless in writing and signed by the party
waiving the breach.

        12. MODIFICATION.

        This Agreement shall not be modified by any oral agreement, either
express or implied, and all modifications hereof shall be in writing and signed
by the parties hereto.

        13. SAVINGS CLAUSE.

        If any provision of this Agreement or the application thereof is held
invalid, the invalidity shall not affect other provisions or applications of the
Agreement which can be given effect without the invalid provisions or
applications and to this end the provisions of this Agreement are declared to be
severable.

        14. COMPLETE AGREEMENT.

        This Agreement (and all other agreements, exhibits, and schedules
referred to in this Agreement, including without limitation the Invention
Agreement) constitutes and contains the entire agreement and final understanding
concerning Executive's employment with the Company and the other subject matters
addressed herein between



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the parties. It is intended by the parties as a complete and exclusive statement
of the terms of their agreement. It supersedes and replaces all prior
negotiations and all agreements proposed or otherwise, whether written or oral,
concerning the subject matter hereof. Any representation, promise or agreement
not specifically included in this Agreement shall not be binding upon or
enforceable against either party. Notwithstanding the foregoing, this Agreement
shall not supersede and replace the Letter Agreement dated May 25, 2005 between
Executive and Western Digital Technologies, Inc. This is a fully integrated
agreement.

        15. GOVERNING LAW.

        This Agreement shall be deemed to have been executed and delivered
within the County of Orange, State of California and the rights and obligations
of the parties hereunder shall be construed and enforced in accordance with, and
governed by, by the laws of the State of California without regard to principles
of conflict of laws.

        16. CONSTRUCTION.

        Each party has cooperated in the drafting and preparation of this
Agreement. Hence, in any construction to be made of this Agreement, the same
shall not be construed against any party on the basis that the party was the
drafter. The captions of this Agreement are not part of the provisions hereof
and shall have no force or effect.

        17. COMMUNICATIONS.

        All notices, requests, demands and other communications hereunder shall
be in writing and shall be deemed to have been duly given if delivered or if
mailed by registered or certified mail, postage prepaid, addressed to Executive
at Western Digital Corporation, 20511 Lake Forest Drive, Lake Forest, California
92630, or addressed to the Company at: Western Digital Corporation, Attn.
Corporate Secretary, 20511 Lake Forest Drive, Lake Forest, California 92630.
Either party may change the address at which notice shall be given by written
notice given in the above manner.

        18. EXECUTION AND EFFECTIVE DATE.

        This Agreement is being executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument. Photographic copies of such signed counterparts may
be used in lieu of the originals for any purpose. Notwithstanding any earlier
execution of this Agreement by the Company and/or John Coyne, this Agreement
will be effective as of the date that the Company and Arif Shakeel, the
Company's current Chief Executive Officer, enter into an amendment of Mr.
Shakeel's Employment Agreement providing for the appointment of Mr. Shakeel to
the position of Special Advisor to the Chief Executive Officer, effective as of
January 2, 2007.


                       [Signatures on the following page.]



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        In witness whereof, the parties hereto have executed this Agreement as
of the date first above written.


                             THE COMPANY:


                             By: /s/ Arif Shakeel
                                -----------------------------------------

                             Name:  Arif Shakeel

                             Title: Chief Executive Officer


                             EXECUTIVE:

                             /s/ John Coyne
                             --------------------------------------------
                             John Coyne



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