Seagate will introduce its first SSD (solid-state drive) storage and 2T-byte hard drive next year, company CEO Bill Watkins said.

The company's first SSD product will be targeted at companies that need speedy storage and can afford to pay a premium for the expensive drives. Seagate has no plans to release SSD drives for consumers as the high prices could deter them for the next few years, Watkins said in an interview.

The release date and price information for the 2TB hard drive were not available. Seagate released 1TBe hard drives, the Barracuda 7200.11 and Barracuda ES.2, in the middle of 2007.

While there is no competition now between hard drives and SSDs, Seagate is thinking of going to SSDs in the long term to replace hard drives.

"SSDs are not price-competitive yet," Watkins said. The storage market is driven by cost-per-gigabyte and though SSDs provide benefits such as power savings, they won't be in laptops in the next few years, Watkins said. Low-power consumption capabilities and high speeds make SSDs useful for laptops, but the cost-per-gigabyte won't come down at least for the next few years, Watkins said.

"If the cost-per-gigabyte comes down to 10 cents, maybe," Seagate will focus on SSD storage for consumers, Watkins said.

A 128GB SSD costs US$460, or $3.58 per gigabyte, compared to $60 for a 160GB hard drive, said Krishna Chander, senior analyst at iSuppli.

"It will take three to four years for SSDs to come to parity with hard drives," on price and reliability, Chander said.

Besides price, other issues will keep SSDs from the consumer space, Watkins said.

Users seek fat storage to carry data and hard drives can store terabytes of data, something SSDs can't do, Watkins said. SSDs also have write issues, with cells in the drives deteriorating quickly and reducing storage capacity, a general problem that plagues flash drives.

Even enterprise adoption of SSDs could be slow, Watkins said. "People are still trying to get tape out of the enterprise," Watkins said.

Seagate's SSD would be mainly for data centers that rely on processing data quickly, like indexing servers or search servers, that can temporarily store data until it is ultimately moved to permanent storage on hard drives or tape. Solid-state drives can move data up to 10 times quicker than hard drives, but data has to ultimately be moved to larger and more reliable storage, Watkins said.

The SSD drive could also be useful for data centers looking to save on energy consumption and costs.

Seagate is taking a wait-and-see approach to SSDs, similar to the company's approach to optical storage. Seagate acquired optical-storage company Quinta in 1997 when everyone thought optical storage would replace hard drives, Watkins said. Seagate wasn't sure how far rotating media technology would stretch, but the cost-per-gigabyte fell and hard drives overtook optical drive technology.

Selling hard drives will remain Seagate's focus for now, but it will make sure the SSD component is available to customers, Watkins said. The company is internally researching and developing SSD storage.

The company already offers hybrid drives like the Momentus that combine NAND flash storage with hard drives to reduce power consumption and improve boot times.

Seagate has been making noise in the SSD market for a year now, but it has been mostly vaporware, iSuppli analyst Chander said. Seagate needs to get a leg up over its competition by getting into the game early and packaging SSDs in volume.

"They haven't stretched out. They are losing an opportunity. The reality is no matter what, in the next three to five years SSDs are going to come out," Chander said.

Entering the SSD market early could give Seagate an advantage over its major competitor, Western Digital, which is too deeply lost in the hard drive market to make its presence felt in the SSD market, Chander said.