They bought IBM’s business, not the brand
Things aren’t good when an unsourced report claims Hitachi is selling its loss-making disk and the stock rises 7% in the biggest 1 day percentage gain in 4 years.
Hitachi denied it. Sounds like the bankers are trying to get something going. “More fees!”
Spend $2 Billion and what do you get?
I day older and deeper in debt. And the disk industry’s premier research group. And a contract with IBM to buy a bunch of drives. So why aren’t they minting money?
Consumerization is the new black
Hitachi is your basic $88 Billion – more if the dollar keeps sliding – company with 384,444 employees. The org chart (pdf) makes the Pentagon look like a model of organizational clarity.
Where did the disk business go? I had it here somewhere.
The “Disk Array Systems Business” is on the chart. The “Storage Area Network Systems Solution Division” is on the chart. The disk drive business isn’t. Did they forget they own it?
So a rumor about the sale of a business that doesn’t even show up on the org chart drives your stock up 7%. Ouch.
Delusional marketing will do that to you
Hitachi makes good drives. They just don’t know how to tell people. Case in point: the Hard Drive by Hitachi marketing program.
The program centers around the usage of the Hard Drive by Hitachi icon (figure 1). The icon signifies that the hard drive integrated as a key component in your product(s) is manufactured and backed by Hitachi, a premier supplier of high quality hard disk drives. Participating companies can utilize Hitachi’s reputation for quality and reliability as well as technology leadership to strongly differentiate their products in today’s competitive marketplace.
Name 1 non-geek consumer who knows Hitachi makes quality drives. Give up? Me too.
Oh, and here’s the logo:
Not quite as zippy as “Intel Inside” is it? I can just see the wise graybeards back in Japan nodding “we’ll save money with a 2 color sticker. Intel sticker costly. We don’t need that. After all, we Hitachi.”
I’m sure this is about as much as the American marketing folks could get past the “Hitachi Corporate Cross-Functional Sales Prevention Strategic Planning and Execution (literally) Steering Committee.” Grim.
The StorageMojo take
Disk drives are modern marvels and Hitachi is one of the best vendors. But Hitachi isn’t a brand to conjure with in America or Europe. Matsushita, years ago, bought every American consumer electronics brand that had any cachet and milked them ever since. Plus they built their own brands, like Panasonic, that now resonate.
What has Hitachi done? Him-m-m? “Hey, I know, let’s be so boring that we hypnotize customers into buying our products!”
Hitachi Japan: if you want a successful American disk drive business you need to get out of your nice comfortable rut and buy somebody like Iomega, that has a brand and some distribution and get serious about wooing consumers. IBM won’t buy your drives forever. America is a consumer society – or at least it was until the ecstasy-fueled sub-prime party ended – and you need consumers to buy your drives. Red labels may work for Bass Ale, but you have a different problem: no one knows who you are.
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