This allows prioritizing and staging of all engineering projects. And Seagate is simultaneously developing a highly efficient manufacturing process to build these new product designs. This investment could not come at a more crucial juncture in the company's history. The fundamental technologies used in disc drives are on the verge of changing more radically than at any time since Seagate pioneered the 5-inch hard drive 20 years ago. And even as company scientists and engineers confront technological challenges imposed by the laws of physics the changes are coming at a time when cost has become a primary design consideration.
Vertical integration addresses a tough marketplace.
The disc drive industry continues to experience ever ever-increasing market pressures. Historically product performance and quality determined which companies captured an OEM customers' business, now performance and quality are a given and price is key. And more competition in the high-end enterprise sector is pressuring profit margins there too. Like all drive makers, Seagate is feeling the brunt of these market forces. But the company has advantages beyond its healthy balance sheet to weather this climate and emerge as one of the strongest players.