Energy costs are making the storage world less flat

Shipping hard drives costs more than the labor to make them

Thomas Friedman’s seminal book The World Is Flat may need an update.  What happens when the cost of transportation outweighs all others in the global value chain?

For hard drives at least, shipping costs more than labor, according to Seagate CEO Bill Watkins.

In the Googlization of our society, it’s easy to miss the fact that all of those ideas are housed on physical machines that are created the old-fashioned way – they’re manufactured. 

How will the global technology manufacturing value chain adapt as expensive energy changes the physical world as the internet changes the information world?

Advertisements

One response to “Energy costs are making the storage world less flat

  1. Here is one way I believe to answer the question – At what point is it cheaper to never ship the drive? – simply plug it in in the factory where it is built and then access it from there – bandwidth over a distance costs money- so things will be shipped as far as they need to be – but no further.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s