History (1998): Sluggish Star for DVD Keeps Door Open for CD-ROM

The overall WW optical drive market finished 1997 up 54% over 1996 with unit shipments reaching 74.7 million, according to new IDC research, Optical Storage Market: 1997 Year in Review and 1998 Forecast.

Looking forward, this market will continue to mature and transition to next gen technologies, growing an additional 20% in a ggregate through 1998.

CD drives and smaller form factor magneto-optical did extremely well, while the larger form factor drives continued to struggle.

The WW CD-ROM market had another outstanding year in 1997, growing 52% in unit shipments from 1996.

DVD-ROM, on the other hand, was almost nonexistent and only began to show a presence in 4Q97.

IDC attributes DVD’s sluggish start to a lack of compelling titles.

“Second gen DVD-ROM drives, which began to appear in volume in 4Q97, are in a much better position to compete with CD-ROM drives,” said Wolfgang Schlichting, senior research analyst, optical/removable storage. “Adoption will proceed slowly in the beginning of 1998 but will pick up in the second half of the year as content increases and prices decrease.“

The CD/DVD-recordable category – consisting almost exclusively of CD-R, CD-RW, and PD drives – reached 3.6 million units in 1997 and will grow an additional 70% in 1998 to reach 6.2 million units.

Here are a few other WW market highlights from the study:
– The total optical storage market will reach 89.8 million units in 1998.
– CDI DVD-ROM shipments will slow to 18% from 1997 to 1998.
– CDI DVD-recordables experienced 142% unit growth from 1996 to 1997. Led by CD-RW, it’s the fastest growing segment of the market.
– The Japanese market will fuel continued growth of 3.5-inch MO.
– 5.25″ optical and 12/14-inch WORM shipments were down 17% and 33%, respectively, in 1997.

This trend will continue through 1998. Despite high expectations for DVD, 1997 turned out to be another record year for CD-ROM. Overall, IDC believes the optical storage market will continue to grow, but DVD will have to make some significant strides to live up to its advanced billing. Falling prices and the ability to read CD-ROMs at 20x or faster have set the stage for DVD to make an impact.

This article is an abstract of news published on issue 125 on June 1998 from the former paper version of Computer Data Storage Newsletter.