Guest: Bill Watkins - Seagate
Host: Robert Scoble - The ScobleShow

Robert Scoble - The ScobleShow
So, who are you, and where the heck am I?

Bill Watkins - Seagate
I'm Bill Watkins. I'm the Chief Executive at Seagate, and you're at Scotts Valley, our headquarters.

Robert Scoble - The ScobleShow
Yeah, and you're my sponsor.

Bill Watkins - Seagate
Am I your sponsor?

Robert Scoble - The ScobleShow
You are the guy paying me...

Bill Watkins - Seagate
Well, okay.

Robert Scoble - The ScobleShow
...which I greatly appreciate. What -- all of those that are out there, why are you sponsoring blogging and podcasting and video blogging? What do you guys see as the opportunity there to get Seagate out in front of people?

Bill Watkins - Seagate
Well, I think as we think about where we're going with our retail products or consumer products and even the standard storage stuff, I actually think the community that is going to be probably most aware, and actually be very receptive to our -- it's going to be people that are on the blogs. Its amazing, we do -- the way we think about it, a lot of our market, and a lot of our people are people under -- definitely under 40, but under 30 and if you think about some of the way we do branding, whether it's X Games, whether it's the gaming tours that we do, whether it's obviously in your -- in your world of blogging, those are the people who I think are the most willingness to do some of these things, the digitalization of content, to start distributing the content electronically, versus someone like -- people who are just near to age.

And so we wouldn't -- you know, it's like -- we've wouldn't sponsor a golf tour; why would you want to sponsor the senior golf tour? Because that group is not going to -- it's not going to embrace all the change that's going on in how people use technology or apply technology. It's going to be people again that I think are much younger and as they go up they'll -- when they are in 40 to 50, they'll even apply technology more. So, it's really getting at -- at I think at the market segment, that's going to be the most receptive (ph).

Robert Scoble - The ScobleShow
Where I see Seagate's name mostly is on disk drives; in fact you are on 900 disk drives.

Bill Watkins - Seagate
Yeah, Right. (Voice Overlap)

Robert Scoble - The ScobleShow
That's your actual street name.

Bill Watkins - Seagate
Right, right.

Robert Scoble - The ScobleShow
So it sets in motion the history of this company, and it's great history. I have been part of Silicon Valley and seen Seagate grow up, but is it a disk drive company today? What is Seagate? We don't know about Seagate other than, oh they make the disk drives; we open our laptop and we see a Seagate drive...

Bill Watkins - Seagate
Right, I think that as a lot of people think about the storage, or they have thought about the storage device that way, it was kind of like what's the old story about the man behind the curtain in the Wizard of Oz. I mean -- and that's where you have the storage devices been on that - on your PC, on your notebook, but it's kind of like that man behind the curtain - it's been hidden, no one knows what's going on, but it's totally critical; you can't do the things you want to do without a storage device. As we come morph ourselves -- and this is what's going on, I think this whole valley - as people and companies change, whether you're at Microsoft or Intel or Apple whatever, we live in a sort of, client-server world of PCs, and we are moving into a consumer world; and it's changing everything about it. And so, in this world, a lot how we play now is about distributing content; and it's about people, you and everybody else, is about distributing your content electronically over the web. And not physical distribution, not a DVD or CD or a film or whatever, it's electronically moving this.

So, as we change and morph ourselves, what enables you to do that is a storage device. And that storage device can be a hard drive, or it can be a flash device storage, but that's what's enabling it and as this sort of the distribution of content explodes, the importance of storage is becoming more and more aware to people; people are starting to see it; you see it in retail stores, people are buying backup storage. They're buying devices that allow them to store and backup and move their content through their storage devices. So again, what we're trying to do, and probably a lot of why we're talking to people like you is, get us behind from that curtain; get us away from being behind that curtain and up front and we have this little thing about, 'This is not your daddy's disk drive company anymore.' It's a whole new world and we're hoping that we'll obviously (ph) get that message out and they'll take advantage of it.

Robert Scoble - The ScobleShow
Today at lunch I was meeting with some VCs and we were just reminiscing about our first hard drives, because I told them I was coming over to see you. And we were all talking about our first -- like my first hard drive was a 20 megabyte hard drive.

Bill Watkins - Seagate
Oh Yeah!

Robert Scoble - The ScobleShow
And it cost like four grand.

Bill Watkins - Seagate
Oh yeah.

Robert Scoble - The ScobleShow
What's the bleeding -- the bleeding edge today; I just got a 750 gigabyte drive.

Bill Watkins - Seagate
Right. Yeah, that 750 gigabyte drive is the highest pure capacity that we sell. So, you'll see terabytes here within six months or so I bet. But just to give you a point; Seagate was formed in 1980, and they couldn't raise money from the investment community because their first drive was a five megabyte hard drive; and this was a five and a quarter inch hard drive that stored five megabytes and nobody thought that anyone needed five megabytes. And there was some great letters from HNQ (ph) and all these people saying, "You know, it's a neat idea, but no one needs five megabytes; you'll never sell any." And in a lot of ways, that attitude keeps -- has been there for ever; people keep saying, why are you need so much storage? And people just keep using more and more storage.

Robert Scoble - The ScobleShow
Oh yeah.

Bill Watkins - Seagate
But it's... (Voice overlap)

Robert Scoble - The ScobleShow
(Voice Overlap) everybody in the world gets one of these HD Camcorders.

Bill Watkins - Seagate
Yeah, (Inaudible).

Robert Scoble - The ScobleShow
The 750 gig drives; they don't last very long with an HD video.

Bill Watkins - Seagate
Well, I mean I have -- I actually at my home, I have over two terabytes of storage. And I have got it with DVDs on it, I have got it with music, I got -- we take pictures, we go on vacation and we will take a 1000-1500 pictures and we just download them and put them on all the PCs, Screensavers etc. So, now we think the -- again, as more and more content starts moving electronically, more and more storage of that digital content, more you back up, more we're going to sell the hard drives -- and on storage devices in general.

Robert Scoble - The ScobleShow
Right. What is the technical reason that drives continue getting bigger and bigger and bigger?

Bill Watkins - Seagate
Well...

Robert Scoble - The ScobleShow
I mean, is there any capacity limit on how much data per inch you can put on a piece of magnetic material?

Bill Watkins - Seagate
Yeah, there's going to be theoretical limits - there has to be. I mean, somehow you can only store so much. What's happened, as you think about it, the industry -- Seagate has taken a big lead in this -- is, we've made a major breakthrough in how we store data on a disk; we call this perpendicular recording. What we have done historically is -- if you think about how we store on a disk - and I'll try to be fairly -- not get too techy on this, but it's a bunch of magnets, a bunch of particles; very small particles, but they are nothing more than a north pole and a south pole, and we switch them; we switch them in one direction its an '0', when we switch them in another direction, it's a '1' - and that string of '0's' and '1's' is how you store data.

And so, if you think about yourself as a child, when you play those magnets, when you push them to come close together there was a natural they want to repel. Well, that's what's happening; as you put more and more data together on a disk drive, the magnets or the particles gets closer, and when you switch them into a position, they won't hold that switch because they are too close; so they switch back. So, how do you get around that, is you now put them perpendicular, and now you can move them closer together before the North Pole. So, if you got two magnets side by side, they repel; you put them on a disk they can get much closer before that inherent magnetism starts repelling them. So, what we have done with perpendicular, is taking all these magnets, stood them up perpendicular to the disk, pack them closer together. Now we are not as close...

Robert Scoble - The ScobleShow
It looks like a forest of magnets.

Bill Watkins - Seagate
Yeah, it's a forest of magnets and - versus if you will, an array, and as we go forward, we have a lot of room now to move them closer together. Eventually, that will finally get so close that we can't do it. And then what we are going to do is, start tricking it; the next technology out of this is, what we call HAMR - or Heat-Assisted Magnetics. And you start applying some of the optical techniques to magnetics; you are going to heat it up real hot, write it, and let it cool down to read it. And tricks like that allow you to write the data very close; but get it back to a normal state so it doesn't switch on you. So, there's a lot of things, so again, we visualize multi-terabytes drives.

Robert Scoble - The ScobleShow
Is that a corollary to Moore's Law for Storage?

Bill Watkins - Seagate
Yeah, there is, and we basically have been increasing areal density as an industry anywhere from 40% a year to 125% a year. So, our ability to store more data has increased at that percentage level. And so, from a year ago, we're probably doing 40% more; and if you think about it, we launched the 750 in the May time frames, we'll probably have a terabyte plus by that time -- that time next year. So kind of gives you a sense how fast this is moving; and we think we just kind of got into what perpendicular can provide for us.

Robert Scoble - The ScobleShow
Now, what else are you guys doing other than hard drives? What innovations are we going to start seeing? I know, I was talking with the Windows Vista folks over the weekend from Microsoft and they were hoping that they were going to get Instant Boot disk drives; disk drives that had a lot of the Windows package in flash memory on the drive. Is that something that you guys are going to be actually doing?

Bill Watkins - Seagate
Yeah, we have that. I mean -- I think one of the interesting issues that will come up when you get the CS is, what we have as a drive - hybrid drive - we call them hybrid drives; and we've been working very closely with Microsoft, to be honest with you. And what this does, it allows you to take advantage of all of the instant-on with vista which -- and I want to call it -- this can be about a ten second or fifty, but significantly better than what...

Robert Scoble - The ScobleShow
(Voice Overlap) two minute.

Bill Watkins - Seagate
In two minutes, right so...

Robert Scoble - The ScobleShow
I used to able to go from -- on culturing (ph) and follow up, I used to be able to go from follow up to the next train station before the Windows booted up...

Bill Watkins - Seagate
Booted up, yeah. So I think -- and so how we do that is, we buy a flash -- and it's not a lot of flash storage; so it's not a Kashya a lot more -- we are talking about 256 megabytes Flash. You put it on the hard drive, it allows you to do the Instant Boot-ons; it allows you to do some things like that, and makes it look like a flash storage and then you get all the big capacity and the video streaming that you're going to have on your hard drive and all the advantages of what a hard drive or memory storage brings to you. So we're going to do that. The interesting thing is, Intel wants to put that Flash on the board; and so, I think it will be an interesting bal which -- who goes? Does it go on the board? Does it go on a hard drive? We are somewhat indifferent to that. We've been asked by all our customers and all of our -- and Microsoft to put it on a drive. What we're going to do is not that big a deal, but it will be interesting, does it show up on the board? Does it show up on the drive?

Robert Scoble - ScobleShow
Interesting.

Bill Watkins - Seagate
If then again, if we go for the drive then you have more flexibility, you don't have to use an Intel board. You can use any drive, and it gives you much more open architecture because any drive now can be used as long as it has a hybrid chip on it. So, that's probably the advantage to the consumer, that you don't get hung up in how to do a certain Intel solution only. But other than that, we're kind of indifferent what we'll do like about it because we think it's going to drive our increase in notebook storage. People are going to want that sort of feature set in notebooks.

Robert Scoble - ScobleShow
Hard drives are being used more and more in portable devices; I could guess, the iPod, the portable phones, Nokia should be a phone with a...

Bill Watkins - Seagate
The hard drive there? Yeah.

Robert Scoble - ScobleShow
...five Gig drive or four Gig drive in it and they are coming out with a eight and ten Gig. I bet power utilization is something that you got to care about on those kinds of devices a lot more than you do on my PC, right?

Bill Watkins - Seagate
Yeah, it is. It's kind -- I mean, power is important; and I think, to be honest, in a lot of ways, it's becoming more important in storages and services and that because people are putting these storage farms together, and the power tasks (ph) are horrendous.

Robert Scoble - ScobleShow
Like Google.

Bill Watkins - Seagate
Yeah, Google -- right. And so, interested or not, we've been spending a lot of work in reducing power in those places and we need to bring it at hand. Interesting enough in the hand, if you have enough storage applications will you need a hard drive versus a flash? What happens is, you end up having to put up a big screen there that takes all your power your ways. So, the drive now becomes a much smaller point of the power usage, like in a Notebook -- it's probably only 10 to 15% of the power usage in a Notebook because the screens eat up so much of it. So, what happens to -- if you had a mp3 with no real screen to it, it's a big deal because the drive sucks up a great -- becomes a great -- if you will, sucks up all the power. When you have a video iPod or deal with a lot of color and graphics and you want to be able to see it, it's not that -- it's as big as a deal, but again, I think you need a drive company or storage company whether it's -- no matter what it is, there is money to be made in reducing power, just...

Robert Scoble - ScobleShow
I just got an HD screen - High Definition TV at home; and I am starting to hook up some weird devices to that. My mom certainly didn't hook up to (Voice Overlap) TV, that's a good trend for Seagate, right? Because like, I am going to get a PlayStation or an Xbox, I am going to get a PVR from either Comcast (Inaudible) or something like that. Are you guys looking forward to that trend? And what kind of new opportunity or new challenges does that mean disk drive manufacture?

Bill Watkins - Seagate
Well, we think that, it's one of these big opportunities because again we -- now, every TV in the world is going to have a disk drive on it, around it, or near it. And so, that obviously presents a tremendous growth. It will be interesting how it shapes up, because do you have storage in every device or you end up with home servers? I mean - I don't know, there is lots of different ways this can kind of, fold out. In any case it goes back to, you need storage. I think that obviously the cable in the United States is a real cable between -- the cable companies and satellite, they're trying to do a subsidy model, so they give you a hard drive and a cable box, or a satellite box -- in a sense you rent.

So, they subsidize that and you rent it. What is an interesting thing -- or be interesting is, do you -- because this is kind of where I have been going through my own space, I started off with a TiVo and then I moved to a Cable Box and I am not thinking about going back because I want to own my content; I don't want -- I'm filling up my Cable Boxes and obviously the cable guys are going to come back with you and say, "Look you want more storage, we'll sell you an external box, plug it in, as you fill up especially with High Definition TV coming." But you are always going to be limited and if you don't stay with that cable company, they're going to yank that content from you versus on a TiVo system or if you buy a Panasonic or whatever, you own that content and you can change cable, whatever you want to do, but you own the content. And what I am kind of interested in -- and I think one of the things that kind of -- is going to be fascinating is, what model is going to work -- are people will go out and buy their own PVRs and pay more money. But (Inaudible) they'd want all that content, or they're going to take the free deal from the cable, but in a sense are always in a 'leasing of the content' mode.

Robert Scoble - ScobleShow
Yeah.

Bill Watkins - Seagate
I don't know which one, for us...

Robert Scoble - ScobleShow
We are going to go with both actually.

Bill Watkins - Seagate
Yeah we do both but again we are not -- we are not a little bit indifferent to it because the arm's dear; we'll sell to both people, but it's just kind of -- again, one of these interesting things how people are going to think about it, and how -- because I've got to own it now; I have kind of gone back to the wave; I'm going to take DV -- Disney, I want to own those for ever and not give them away

Robert Scoble - ScobleShow
All right, I want to store (Inaudible).

Bill Watkins - Seagate
Right. Or the Sopranos.

Robert Scoble - ScobleShow
Why don't we have the last teen in (Voice Overlap) ten versions?

Bill Watkins - Seagate
Yeah, right. So, I think that will just interesting how, and again, it will be interesting how you blog people think about it in that way or if they do. So...

Robert Scoble - ScobleShow
Is a Seagate working on any optical stuff like the Blu-ray or the HD (Voice Overlap)?

Bill Watkins - Seagate
No, we don't; we do sell obviously into -- Blu-ray to me -- and I don't want to, because I sold the (Inaudible) so on both sides of that, I don't want -- but...

Robert Scoble - ScobleShow
But the new beta versus the VHS (Voice Overlap).

Bill Watkins - Seagate
Yeah, it is; and I don't want to go into how stupid it is.

Robert Scoble - ScobleShow
Well, I think you just said it.

Bill Watkins - Seagate
Yeah. It's amazing what schiffer (ph) brains we have, but I think what's interesting here, and...

Robert Scoble - ScobleShow
(Inaudible).

Bill Watkins - Seagate
But what's really interesting is this idea of physical distribution; because you think about Blu-ray and HD, they are both physical distributions; and my -- and I had your great pictures. I mean I've looked at both of them, and you get a different picture.

Robert Scoble - ScobleShow
I have HD, DVD and when I get the PlayStation later this year, I'm going to have Blu-ray...

Bill Watkins - Seagate
Yeah. Blu-ray.
And so, I mean I think they'll both give you an excellent experience. I think you're going to be able to get that just off any digital hard drive, and so I'm not sure how much it is, but the interesting battle to me, and that's what I think is a real battle going on, its physical distribution versus electronic. And so, it's like -- you know, my kids are very younger teenagers and they don't like carrying -- because it has to do like, well, they think if you have to have CD's, that's just not smart; you want to download everything and move it electronically - and that's how they think about their world. They don't want CD's, or carry around a bunch of CD's or DVD's or any of that stuff and so -- it will be interesting, that's what I think -- you know, there is a battle between Blu-ray and HD, but I tell you the real battle is physical distribution of contents versus electronic; and we're obviously trying to enable electronic as much as possible; because that really benefits us.

Robert Scoble - ScobleShow
Well, Bill Gates said this is probably going to be last hard physical format war, right?

Bill Watkins - Seagate
Yeah, it is.

Robert Scoble - ScobleShow
Everything will be BitTorrent versus Red Swish next time.

Bill Watkins - Seagate
Well yeah. And I'll be honest, I think it actually helps us because it almost -- you want this to default to a hard drive. I mean, why do I need physical distribution? And so, at some extent I think this battle if they just extend it out it's going to actually maybe help us, but it's another stupid battle that we don't need. But...

Robert Scoble - ScobleShow
Is Seagate going to do anything that we don't expect in the next six months, like a digital camera division or CD or...

Bill Watkins - Seagate
Well, we are going to -- I think we are going to keep going up as we put more and more value in this retail back-up storage, allowing your content to move around, access your content. I think at Seagate -- yes, we are going to talk about how much you have come out. But we've got our whole new product lines, we're putting lot of focus on the consumer, on doing things in the stories and in a lot of ways, we're trying to think of ourselves as a storage company, not a hard drive company. And so, we want to look at where storage is being spent and how do we plan that? And so, I think one of the trends that we are trying to change at least at the executive level and getting across to the whole company; don't think yourself as a hard drive, think yourself as a storage - embrace flash and that's a right solution. Embrace this ideal -- our deal is to give people storage solutions; and wherever storage is playing, let's take a look at that and see what we can do.

So I think there will be things that -- we are going to have some more nonsense come out, I think we've got some of very nifty products we have coming out of the CES. But you are going to see is, doing more and more server stuff, put more and more software in our hard drives, more and more value added. And again as that hard drive becomes out of the curtain, we are going to showcase on what you can do with it storage wise. Because you think about it, I think for more and more and tell us on the storage device, that's a natural place for it to reside. Because your friend Bill really made this -- had tried to make this storage device as stupid as he could; and that's what he tried to do. And in the consumer world, we have this opportunity now because Microsoft is to make it much smarter.

Robert Scoble - ScobleShow
Yeah, well it -- certainly with media now, I just was at the Portable Media and Podcasting Expo and everybody there is being their own radio station and moving to video and that's a lot of HD video cameras there, and this seems to -- 40 Gigs an hour okay? Record them at full -- and just imagine every single family with a HD camcorder, filming pictures or videos of kids, they are going to need a lot of storage.

Bill Watkins - Seagate
But we sell a lot -- we do a Sony branded product, where we sell one of our one inch drives into their High Definition cameras - and they are doing really well. And I guess, because people are finding it very -- it's nice to have it there, they can move it very easily to a PC or whatever and do all stuff.

Robert Scoble - ScobleShow
My camera is only two months old and it's already obsolete; the new one has one of your drives.

Bill Watkins - Seagate
Yeah

Robert Scoble - ScobleShow
That one -- the new one is really bad because it lets me reduce the workflow; because right now, I am filming you on tape, and then I have to convert that to digital bits on my computer, and that takes an hour right there, and then I have to edit it. If I had it all on a physical digital media, it would be really great.

Bill Watkins - Seagate
After they're do it -- and this is a good example, we worked with Sony, they put a bunch of software in the drive to allow you to do a lot of neat stuff from the camera perspective, and then we sell under their name, we're giving like their branded name. But again, it just shows how to facilitate out of the physical to start electronically moving your content, whether it's film, music, video, whatever.

Robert Scoble - ScobleShow
Are we going to see Seagate show up at more music and video -- experiences where you might use a camera like this to make video? Like Yahoo! just last week had Beck (ph) show up at their party...

Bill Watkins - Seagate
Party. Oh yeah.

Robert Scoble - ScobleShow
...and everybody was filming it...

Bill Watkins - Seagate
Yeah, yeah.

Robert Scoble - ScobleShow
... and flickr'ing it, and taking these high res digital photo -- Thomas Hawker -- Scott Veil (ph) was there with their 5D cameras and they were -- each image they shoot, choose a five or ten megabytes.

Bill Watkins - Seagate
Megabytes. Yeah, I know. Again, we are kind of a little less likely right now at least to try to get into content generation. What we want to do is, help facilitate content distribution. So where we have looked in -- or things that we think about is, how about we get all of the old -- put a content with someone for example, take movies that are all fifteen years old, because no one cares about those, put a whole -- take a whole studio's library and put them on a hard drive; or take all the EDS games that no one had bought -- not the newest ones, but take all the old ones, put them on a hard drive, help you distribute that content - things like that.

So, I mean I think we are more interested at least in the near term, is how do we help facilitate content being distributed that way? And you'll see more of us put in a lot of work. It's kind of hard stretch for me -- for Google, because they have a way to distribute that content through the web and so, it's a big deal to them, because in a lot of ways I think, these internet companies, they have a much better advertising model than the local TV station does; and then they are going to tear apart (ph) newspapers and TVs.I mean, I think I saw an Op Ad piece, New York Times, where this guy's absolutely minting the newspaper. That it was hard for newspapers to make money, that all this other accesses, and that somehow America was going to lose this great tradition of newspapers.

And I remember talking of some people in New York, "Guys, you get it wrong; the newspaper is just print; it's a distribution model. What's important about a newspaper is the writers and the content." And you know, we've been changing how we distributed content, I mean, we used to deliver content with a pony express, then it was the train. And every time, you know what, Kit Carson doesn't have a job anymore; but you know what, that's not what was key - what's key is the content. And so, whether you're -- if you are a newspaper writer, it's about what you write and your thoughts and ideas, and what's the best, most efficient way of distributing that content. That's what important here, not have an instinct (Voice Overlap).

Robert Scoble - ScobleShow
I certainly read a lot of newspaper brands, I still read them (Voice Overlap).

Bill Watkins - Seagate
But you don't need ink on your fingers to get the content, and so -- that's what I was trying to -- listen you are a writer, why do you care, why do you really care? It's just like, if you deliver the mail, why do you care if the Pony Express is no longer around, you got a better method with the train. And that's what is funny how people kind of get wrapped up. But that's what going on; it's about different ways to distributing. And just like the cable thing; when you start eliminating commercials, what's going to be the best way then to get commercials to people. Yahoo! and Google, they've got a pretty nice way of really sorting advertising by your need and all that. So again, I think it can be a very dynamic world, and a lot of ways how we distribute content it's going to change phenomenally, and there's going to be certain sorts of companies or ways that are going to look like the Pony Express - and that's just the way it goes.

Robert Scoble - ScobleShow
Me, I'm getting rid of commercials so... Thanks for helping me in that. This is a commercial...

Bill Watkins - Seagate
Yeah, yeah. Sort of.

Robert Scoble - ScobleShow
What is it?(Voice Overlap)

Robert Scoble - ScobleShow
Well, Thanks for your support. I really appreciate it.

Bill Watkins - Seagate
Okay, thank you.

Robert Scoble - ScobleShow
Thanks. So, we had -- I was just talking to you after the tape showed up, so I have one more question which came up. Do you shutdown your PC at night or not? - And why or why not?

Bill Watkins - Seagate
No I never shut it down. The most -- the toughest you are on a PC or even a notebook is when you turn it on. And starting and stopping that is probably the most stress you are going to put on a hard drive unless you drop it. So, if you do not turn it off, you just eliminate that stress, and it just keeps the head flying and you know my belief is that they'll last longer. So, there's no need, I don't care about the power cuts or whatever it is you are trying to save. So again I...

Robert Scoble - ScobleShow
So you are not a green guy (Voice Overlap).

Bill Watkins - Seagate
I mean, you can argue, well, you were trying to save power or whatever. I think at the margin, that's a minor thing. But no, I've run all my PCs, even this one right over here, I never turn it off.

Robert Scoble - ScobleShow
And why is that, is that because the drive head is actually flying over the surface, and it's like you guys have a lot of aerodynamic engineers right...

Bill Watkins - Seagate
Oh, yeah.

Robert Scoble - ScobleShow
...who understand -- they could build an airplane, but they build a airplane that's like, the size of a piece of a hair, right?

Bill Watkins - Seagate
Right. And it flies very close to the ground consistently. The belief is -- and to be totally honest, this was probably a bigger issue ten years ago than it is today and the reliability drives are so much better than they were. I mean, just to give you a sense; when I first started this business back in the early 90's, you know, you couldn't do 5,000, 10,000 stop starts on a drive, that was the most as you can do. We would routinely go 100,000 now without any issue. Because we've learnt a lot of Tribology and lubes and things like that over time. And probably the single reliability improvement has been the ability for heads to fly off. And so, to some extent this is a practice.

Robert Scoble - ScobleShow
When you say fly off, they actually come up to the head when they start powering down?

Bill Watkins - Seagate
Or in the case of Notebook, we actually load it like this; it's called dynamic load, and because you know we are going to turn the notebook off, we put less stress on it. So, again some of them believe that it costs you more to keep your PC on; you don't believe that it probably on reliability and the margin helps you. Bigger issue ten years ago, but I never turn it off.

Robert Scoble - ScobleShow
How do you personally back up your stuff?

Bill Watkins - Seagate
I have a mirror backup system and we kind of, two different ways; for example, my girls, I have two (ph) girls, they have external drives. So, they are really interested in -- they have iPods and stuff like that and so they download on to a PC, but then they download it to an external drive so they can keep all their songs, and then they move it over to their iPod to listen to. But they want to keep it in two locations, because they want to just protect that content because we make them pay for songs. So, it's a lot of money for them to buy a song and they definitely want to make sure they don't lose that investment they've made. But we have a mirror backup system which is an online system that automatically backs up everything in your PC, allows you to access that store remotely and do a lot of things, so it's very convenient.

Robert Scoble - ScobleShow
Is that something you can just buy at FRY'S? (ph)

Bill Watkins - Seagate
Yeah, you go into FRY'S and you hook it all up and do that and...

Robert Scoble - ScobleShow
You just go in and say, "I want a raid."

Bill Watkins - Seagate
You are right. It's a small raid but you can -- again, some of the more sophisticated, external drive -- I have a 750, has a lot of that software; you put it up and back it up.

Robert Scoble - ScobleShow
You buy two 750s and it automatically backs up?

Bill Watkins - Seagate
(Voice Overlap) you can do all that and put that and buy that software that does it. And so, it's automatically done; you don't have to think about it. And then, to be honest, you want to be able to remotely access that Wirefly (ph) wirelessly, because a lot of times you are out maybe with your notebook, "Hey, I want to show someone all my kid's pictures from vacation. Let me go access that data and put it in my notebook so I can show it to you." So, it has some advantages like that; but that's how we backup, and we backup a lot because...

Robert Scoble - ScobleShow
Now what happens, if your house burns down, do you have -- do you use a backup service? Like, some of my friends have been playing with the Amazon's S3, so they can use that to write a little utility to back -- to put all their stuff up on the cloud.

Bill Watkins - Seagate
Cloud. Right. You know...

Robert Scoble - ScobleShow
So if their house burns down and all their (Voice Overlap)wiped out, they still have backed all their stuff, stored offside somewhere off -- out of the house.

Bill Watkins - Seagate
Out of the house, yeah. No, we have a second house, where we backed up everything in our second house.

Robert Scoble - ScobleShow
I don't have that available.

Bill Watkins - Seagate
So, but that point (Voice Overlap) sponsorship. So, we have our second house and to be honest, things like for example, I have a DV disk distribution system. I probably have almost two terabytes of DVD's on a system in my house, on a RAID system.

Robert Scoble - ScobleShow
All right. IIA is coming after you.

Bill Watkins - Seagate:
No. I've actually bought all these DVD's and have download (voice overlap). But I can distribute through all the TV's in my house. And I actually have two systems; I have one in this house and one that's in another house. So I have all this content but you know interestingly enough the movie content, it costs a lot, but it's your pictures; it's your home pictures and all that stuff, and we actually have one drive locked up in the safe that has -- it's not so much pictures as it is all our financial records, we have locked up in a safe, in case the house does burn down, it's in a fireproof safe - the hard drive.

Robert Scoble - ScobleShow
Well, thanks again.

Bill Watkins - Seagate
Thank you.

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