Transcript: Getting ready for CES at Seagate Mar

This transcript is from a PodTech.net podcast at:
http://www.podtech.net/home/technology/1712/seagates-jim-druckrey-designing-drives-saving-your-digital-life

Guest: Rob Pait - Seagate
Host: Robert Scoble - ScobleShow

Rob Pait - Seagate
I'll take care of Seagate has been entering a lot of new markets over the course of last seven years I came here and we were still really all about making drives for PCs, making drives for servers, and there is a little company name WebTV that started using our hard drives in an application that's set on the top of a television set or around the television set instead of just being in a PC somewhere and that really started the whole revolution where consumer electronics companies want more and more storage for digital content in their boxes and that has been a massive business not just for Seagate but for the consumer electronics companies, for companies who built set-top boxes for cable companies, for satellite companies, it's changed the entire business model. Out of that humble beginning what we see is really a tsunami hitting Hollywood; business models are changing allover the places; the way they're delivering their content is changing, the way that people want to get their content is really changing.

Robert Scoble - ScobleShow
Absolutely. I just had DirecTV put in this morning and they brought a PVR with a hard drive in it. I have iPods and Zunes now with hard drives at home. What kind of devices are your hard drives going into?

Rob Pait - Seagate
We actually have a tour that has been going all around country, it's a semi-trailer truck outfitted with tons of gear that's got storage in it and people have been amazed that how much storage we already have in our lives without even thinking about it, right. So, if you're thinking of the Xbox has storage in it...

Robert Scoble - ScobleShow
Got one of those.

Rob Pait - Seagate
There you go.

Robert Scoble - ScobleShow
I couldn't get a PlayStation. So, that's only where the Xboxes go.

Rob Pait - Seagate
Well, that's okay. That's just not a bad thing to settle for actually.

Robert Scoble - ScobleShow
That's a beautiful...

Rob Pait - Seagate
It really is and it's fun to see actually the way the whole video game console business is changing. Now, instead of all the money being made off of one DVD that sold at the store, you've got all these incremental sources of revenue coming for the video game company and for Microsoft through what it get downloaded. Now, of course, Xbox Live you can now download video, actual television programs and eventually, there'll be other content after that and of course, other video game console companies are looking at that as well.

Robert Scoble - ScobleShow
So, the kind of devices that you're in-charge of are what -- like iPod-style device -- you are in-charge of consumer electronics.

Rob Pait - Seagate
Yeah, so that includes things like the digital video recorder and other set-top box kind of device -- categories that use hard drives in them...

Robert Scoble - ScobleShow
That's going to see huge growth over the next two years.

Rob Pait - Seagate
Oh! The growth in that has been absolutely explosive.

Robert Scoble - ScobleShow
I know because at Microsoft, I got to tour around their IPTV room and believe me they've big plans and so did Cisco who's competing with them and they bought scientific...

Rob Pait - Seagate
Scientific Atlanta.

Robert Scoble - ScobleShow
...Atlanta. I was like to say, Scientific American, but that's a magazine.

Rob Pait - Seagate
That's a different subject entirely, but that whole acquisition has Cisco of course, dreaming of big things as far as being able to move the ones and zeros that we call entertainment around your home and being able to have access to whatever entertainment you want, wherever you want in the home, they have -- they're one of the companies -- they really has a brilliant strategy we think for helping consumers realize the power of just being able to have your content and experience it wherever you want to.

Robert Scoble - ScobleShow
Now, I've a feeling you're a busy guy right now.

Rob Pait - Seagate
Yeah, I'm running crazy, of course...

Robert Scoble - ScobleShow
Because of Consumer Electronics Show is coming up, right?

Rob Pait - Seagate
CES is happening, and there are so many people here at Seagate right now and they are just completely focused on it. It's kind of one of the ways we've changed as a company actually, we used to be, we didn't really care about CES, but here over the last...

Robert Scoble - ScobleShow
Really.

Rob Pait - Seagate
Oh! Yeah.

Robert Scoble - ScobleShow
You would think Seagate would have always cared about showing up at -- well, maybe not CES but COMDEX.

Rob Pait - Seagate
Well, COMDEX, yeah. We're at COMDEX for a long time but CES became really the most important show of the entire year for us because there are so many companies and so many of our customers there who want to meet with us, but also we're just able to kind of...

Robert Scoble - ScobleShow
Not to mention the bloggers.

Rob Pait - Seagate
The bloggers are going to be the force this year.

Robert Scoble - ScobleShow
Well, Seagate has the Seagate in PodTech blog house.

Rob Pait - Seagate
That's right. We've got the blog house going on. Of course, you're going to be at our booth for a while and that's going to be really cool. We're going to show a lot of the applications that we talked about, set-top box, PVR type of thing. We're going to be showing off what we're trying to do with mobile video and some companies that are...

Robert Scoble - ScobleShow
Stop with that!

Rob Pait - Seagate
Okay, mobile video.

Robert Scoble - ScobleShow
What is that? Is that an iPod with a video screen or...?

Rob Pait - Seagate
Well, it's -- of course iPod does do video. There're other companies besides Apple that are also making devices on which...

Robert Scoble - ScobleShow
Archos and...

Rob Pait - Seagate
Archos, Creative. There are a lot of votes from some Creative and some South Korean companies that I probably haven't heard of, but we'll have some of their products that are shown as well.

Robert Scoble - ScobleShow
So what -- it's going to (Voice Overlap) we are hearing a lot.

Rob Pait - Seagate
Yeah. Well, this is what's going to be inside those devices. This is our new 1.8 inch drive and we call it 1.8inch because that's the diameter of the platter there where the data is stored. Now, I just want to tell you, I want to tell your viewers that we don't make drives which actually are used in devices they have clear covers on them like this, although that would be extremely cool but this is really just to kind of show people what's inside and it gives great way of -- kind of showing the mechanics of the hard drive that not works here.

So, you could see its really thin drive. It's 5-mm thin and so it's going into a whole new generation of media devices not just video but music, video, photos, whatever else you want can kind of say it's kind of big for a mobile phone. We actually have a 1-inch drive. It's a little bigger than an SD card that we're actually talking to a lot of mobile phone manufacturers about. From the thickness standpoint, you can see what's happening.

Robert Scoble - ScobleShow
Well, Nokia and Microsoft are building -- well not Microsoft but HTC who uses the Microsoft smartphone are building phones with drives.

Rob Pait - Seagate
That's right and HTC is actually a company that we've have an excellent relationship with their and we're working with them from a development standpoint on this.

Robert Scoble - ScobleShow
Now how many - how much is one...?

Rob Pait - Seagate
This is a 60 gigabyte drive.

Robert Scoble - ScobleShow
60 gigabytes. I just took a tour to the computer history museum in Silicon Valley, and they have hard drive that's like this big; it was 10 megabyte.

Rob Pait - Seagate
Right, right and you could fix those drives with a screwdriver and brillo pad in some cases. Hard drives back then were really heavily dependent on mechanics. This drive is much more dependent on electronics and which you saw back then.

Robert Scoble - ScobleShow
Explain why - how did you get that - from that world the 10 megabyte for a big --literally this big to 60 gigs and almost the size of my finger.

Rob Pait - Seagate
Right, right. It's a (Inaudible) put this next to a credit card. It's that the size of a credit card, it is a little smaller than that.

Robert Scoble - ScobleShow
Well, we have 60 gigs in our wallet.

Rob Pait - Seagate
Yeah, go ahead and pull out a credit card or a driver's license or whatever - let's see here's your standard issue of Visa card and...

Robert Scoble - ScobleShow
No, don't put it on the camera.

Rob Pait - Seagate
All right.

Robert Scoble - ScobleShow
My audience - they would go shopping. Although that one is full.

Rob Pait - Seagate
Don't want that.

Robert Scoble - ScobleShow
I already went Christmas shopping.

Rob Pait - Seagate
Yeah once, once (Inaudible) that card. We have a concept in the hard drive business called aerial density and that's simply means how many of a tiny magnetic bits that we record ones and zeros on can you pack on to one of these platters and that recently took a major jump with a technology and technical term again -- it's perpendicular recording technology where instead of having the bits to get magnetically charged on a hard drive lying flat on the surface they actually are turned on their end and embedded into the surface.

Robert Scoble - ScobleShow
Tell me about, how good is the battery life getting or the batteries -- the power consumption on these devices getting? How is that changing because that obviously when you stick one of these in a cell phone that's going to be a big deal, right?

Rob Pait - Seagate
Yeah.

Robert Scoble - ScobleShow
Does it last three days (Voice Overlap).

Rob Pait - Seagate
Yeah, that's right, and a drive like this, you won't see in a cell phone; it's too big for a cell phone. We do have a much smaller drive, and again, it's about the size of an SD card, but we are talking to mobile manufacturers about Net drive has been in music players and GPS systems for a while now; it's our 1-inch drive, then again a 1-inch diameter, a platter inside of that drive that holds 12 gigabytes to date, and this drive in particular -- what we do with each generation of disk drive is we not only make it able to handle more capacity in less space, but we also go back and we do things like reduce the power consumption it requires and so, this particular drive, for example even though it's our first 1.8-inch hard drive; other companies have been making this for a few years and putting them into the media players, but this will come out as the drive that needs the least amount of battery power. So, a mobile device that has one of these hard drives in it, well actually have more battery power than any other device using this kind of hard drive.

Robert Scoble - ScobleShow
Tell me about what's happening on the cost curb because I know your business is under a constant pressure -- more is law pressure...

Rob Pait - Seagate
Yeah.

Robert Scoble - ScobleShow
Obviously, it's quite a different law if you're not Silicon but it's the same kind of pressure on price. So, every year your hard drives get more stuff... (Voice overlap).

Rob Pait - Seagate
What we do is that we do have a name for that kind of law around the company, but I really can't repeat it on camera.

Robert Scoble - ScobleShow
All right. It's lot of fun, I love to live with it?

Rob Pait - Seagate
You know? That's it. The thing about the consumer devices is that consumers always expect for the devices to do more and they expect them to cost less with every generation and that's really true on the consumer's device space. Of course, it's always been true in the PC space, it's been true with servers, it's been true with really any technology device that we use today, and so what we do is we go and -- one of the things we did for this drive, for example is we started of with a lot of chips on the main board that you can't see here because it's protected. We do this to keep it from... for example people accidentally discharging static electricity into the main board, right? So, we covered it up that way but...

Robert Scoble - ScobleShow
Now, a normal customer like me wouldn't come in and buy one of these from Seagate, right?

Rob Pait - Seagate
That's right.

Robert Scoble - ScobleShow
You would buy this as a part of an iPod Style or cell phone or something like that?

Rob Pait - Seagate
Exactly, and that's a plan today as we would normally sell this drive to companies that are building systems and those systems range from being the obvious... the portable video player or the portable audio player, all the way out through really interesting new applications like, for example digital video cameras...

Robert Scoble - ScobleShow
Yeah.

Rob Pait - Seagate
...now are taking hard drives and...

Robert Scoble - ScobleShow
...I bought the old Sony; this cam is only four months old and it is probably obsolete...

Rob Pait - Seagate
I hate doing that out.

Robert Scoble - ScobleShow
I hated it too, especially when you spend for grant.

Rob Pait - Seagate
Right! Right!

Robert Scoble - ScobleShow
But the new Sony has -- I think a 60 gig drives in it.

Rob Pait - Seagate
Yeah.

Robert Scoble - ScobleShow
...so that you can.... but it has a hard drive on it and it records the tape and hard drive and so you can shorten your workflow which I sure you want to get a couple of cameras.

Rob Pait - Seagate
Yeah. Instead of having to wait for the video to kind of roll into your computer real time, it's just you have taken a file off of one drive and put it on another drive and now you are ready to edit.

Robert Scoble - ScobleShow
Well, thanks for meeting.

Rob Pait - Seagate
Sure.

Robert Scoble - ScobleShow
This has been a lot of fun.

Rob Pait - Seagate
My pleasure rather.

Robert Scoble - ScobleShow
Let's see you at CES.

Rob Pait - Seagate
Yeah. I'll see you at CES.