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Interview: Jonathan Gerber, Horizon Technology

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Horizon Technology, who employs Gerber, is an independent distributor that works with some of the worlds largest OEM, EMS, and after-market service providers, and has a fairly good vantage point to view the impact of recent flooding in Thailand. ”We have some pretty good information stream from the manufacturer, also from the open market and from our OEM base. We are able to play at a pretty high level with this flood right now,” he says, speaking from a phone in California.Gerber is in charge of Horizon Technology’s trading, sales and purchasing for distribution, as well as some of the company’s key relationships.Regarding the current HDD market, Gerber says pricing has decreased compared to the worst days after flooding, but it’s still high, up over 100 percent from the original pricing before the flood.Essentially OEMs are only buying what they need. “I think they are waiting to see what Seagate is going to do and what Western Digital is going to do. It’s a game of chicken right now,” Gerber explains. “Over the past ten days it’s softened up a little where the OEMs, they’ve bought enough products, they are now sort of sitting back and waiting to see what happens”.Notebooks should start improving soon but Gerber can see signs that enterprise HDD might be the biggest issue over the next 60 to 90 days. Enterprise class drives require larger storage capability and a greater workload than other systems and, hence, are a higher value product.“That’s Western Digital hardest hit product… and from what we are hearing from the OEMs, Seagate is really decommitting a lot on that product,” according to Gerber. Although suppliers may prioritize higher value enterprise HDD during the shortage, Gerber says that the production time takes longer and will be under greater stress in the coming months. “What I’m hearing from customers, it’s going to be an issue,” he says. As a distributor, Horizon Technology has had to work in different ways to keep customers happy during the shortage.“We’ve come up with creative solutions. We have a major OEM that we’re allowed to take a generic drive and flash their firmware onto the drive to support them with that product. We’re now able to that for service and for production”.Lessons will be learnt from these events, across the industry, but right now Gerber thinks the most evident thing is that these types of events are unpredictable.”It’s almost virtually impossible to prepare for these things. From where we sit you have to have the proper banking and finacing in place. You have to have the talent with your team that wants to work extremely hard, you know long hours”.

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