Seagate Technology: Wikis


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Seagate Technology
Type Public (NASDAQSTX)
Founded 1979
Founder(s) Al Shugart
Tom Mitchell
Doug Mahon
Finis Conner
Sayed Iftakher
Headquarters Grand Cayman, Cayman Islands
Area served Worldwide
Key people Alan Shugart (Founder)
Stephen J. Luczo (Chairman CEO and President)
Bob Whitmore (CTO)
Pat O'Malley (CFO)
Brian Dexheimer (Division President, Consumer Solutions)
Industry Computer hardware
Products Barracuda
Seagate BlackArmor
Seagate FreeAgent
Seagate Replica
Seagate Showcase
Revenue US$ 9.805 billion (2009)[1]
Operating income US$ 2.635 billion (2009)[1]
Net income US$ 3.086 billion (2009)[1]
Total assets US$ 7.087 billion (2009)[1]
Total equity US$ 1.524 billion (2009)[1]
Employees 54,000[1]
Subsidiaries Maxtor

Seagate Technology (NASDAQSTX) is the world's largest hard drives and storage solutions manufacturer. Founded in 1979 as Shugart Technologies, Seagate has nominal headquarters at the Ugland House in the Cayman Islands[2] and has a large operational office in Scotts Valley, California.




Early history


In 1979 Seagate is founded as a disc drive manufacturer. A collaborative effort between co-founders: Al Shugart, Tom Mitchell, Doug Mahon, Finis Conner and Sayed Iftakher.


Their first product (released in 1980) was the 5-megabyte ST-506, the first hard disk to fit the 5.25-inch form factor of the (by then famous) Shugart "mini-floppy" drive. The hard disk was a hit, and was later released in a 10-megabyte version, the ST-412.

In the early 1980s, Seagate secured a contract as a major OEM supplier for the IBM XT, IBM's first personal computer to contain a hard disk. The large volumes of units sold to IBM, as IBM was the dominant supplier of PCs at the time, fueled Seagate's early growth.

In 1983, Al Shugart was replaced as president by then chief operating officer, Tom Mitchell. Shugart continued to oversee Seagate planning.

Finis Conner left Seagate in early 1985 and founded Conner Peripherals, which originally specialized in small-form-factor drives for portable computers. Conner Peripherals also entered the tape drive business with its purchase of Archive Corporation. After ten years as an independent company, Conner rejoined Seagate in a 1996 merger.

In 1989, facing increased competition and margin pressure, Seagate acquired Control Data's MPI/Imprimis (CDC) disk storage division. This acquisition gave Seagate access to CDC's voice-coil and disk-manufacturing patents. As well, the purchase provided access to a high-end server customer base and the first 5,400 RPM drives on the market (the CDC Elite series).

Seagate ST-225, cover removed.
Seagate FreeAgent External Hard Drive (80Gb)


1991 - (September) Tom Mitchell Resigns under pressure from the board of directors. Al Shugart reassumes presidency of the company.
1992 - (November) Seagate introduced the Barracuda hard drives, the industry's first hard disk with a 7200 RPM spindle speed. Seagate was the first introduced to market hard drive with shock-sensing technology for 2.5-inch hard drives.
1993 - (May) Seagate was the first to ships 50 millionth hard drive in the hard drive industry.
1996 - (February) Merges with Conner Peripherals to form world's largest independent hard-drive manufacturer. (October) Seagate introduced the Cheetah, the industry's first hard disk with a 10,000-RPM spindle speed.
1997 - (October) Seagate introduces world's first Fibre Channel interface hard drive. Seagate introduces first 7,200-RPM hard drives with Ultra-ATA technology for desktop computers.
1998 - (March) Seagate Research produces 1 billionth magnetic recording head. (August) Seagate Research is established in Pittsburgh, PA-USA.
1999 - (April) Seagate ships its 250 millionth hard drive in the hard drive industry.

In May, 1997, the High Court of Justice in England awarded Amstrad P.L.C. $93 million in a lawsuit over reportedly faulty disk drives Seagate sold to Amstrad, a British manufacturer and marketer of personal computers[3].


2000 - Seagate incorporates in Grand Cayman to reduce income taxes.
2000 - (February) Introduces world's first 15,000-RPM hard drive, the Cheetah X15. (November) Unveils the world's highest-capacity hard drive, the Barracuda 180-GB.
2001 - (March) Second-generation Cheetah X15 introduced, one year ahead of the competition. (October) Microsoft Xbox game console ships with Seagate hard drives.
2002 - (May) Introduces Cheetah 15K.3, its third-generation 15,000-RPM drive, one year ahead of the competition. (November) Demonstrates perpendicular-recording areal density of 100 gigabits per square inch. Delivers industry's first Serial ATA hard drive, the Barracuda ATA V. (December) Re-enters the public market (NYSE: STX).
2003 - (June) Seagate re-entered the notebook market with its 2.5-inch Momentus hard drive. In 2005, Seagate started an innovation called the "Pocket Hard Drive," a palm-sized external-storage device that could hold 5 gigabytes of data. Just three years later, a compact Seagate FreeAgent Go portable hard drive could store 250 gigabytes. (September) Announces highest areal density at 100-GB per platter.
2004 - (February) Announces Savvio, the industry's first 2.5-inch enterprise hard drive. (June) Launches 12 new products aimed at applications like MP3 players, DVRs, notebook computers, PCs, servers and data centers.
2005 - (March) Ships 10 millionth 15,000-RPM hard drive. (September) Acquires Mirra, Inc. (November) Acquires ActionFront Data Recovery Labs.
2006 - (January) Named 2006 "Company of the Year" by Forbes Magazine. (February) Introduces world's first 12-GB 1-inch hard drive. (April) Introduces world's first 750-GB hard drive. (May) Seagate announced plans to acquire Maxtor. The all-stock deal was worth $1.9 billion. The transaction was completed in May 2006. With the Maxtor acquisition, Seagate significantly increased its scale and expanded its line of retail storage products, tapping the fast-growing home and small-business markets. Seagate's Maxtor OneTouch and FreeAgent line of external hard drives, with storage capacities of up to 1.5 terabytes, are used to store, share, protect and back up digital content like photos, videos, games and music. (October) Ships world's first hybrid hard drive.
2007 - (March) Seagate acquires EVault. Seagate ships world's first laptop drives with Full Disk Encryption (FDE) technology. (September) Seagate responded with a 1-terabyte desktop hard drive that uses government-grade encryption technology (Full disk Encryption or FDE) to prevent unauthorized access to data on lost or stolen hard drives or systems. Along with its Barracuda FDE hard drive, Seagate also announced a 250-gigabyte, 2.5-inch hard drive, the Momentus 5400.4, the world's first notebook drive with built-in encryption.
2008 - (March) Seagate acquires MetaLINCS. (April) Seagate becomes the first to ship 1 billion hard drives. (June) Seagate announced a 2.5-inch enterprise solution, the Savvio 10K.3 hard drive, which consumed 70 percent less power than traditional 3.5-inch drives and offered 300 gigabytes of capacity. Market researcher IDC predicts that such small form factor enterprise drives will outnumber 3.5-inch enterprise shipments by 2010. Seagate announces world's first 1.5-TB hard drive.

Seagate Technology has replaced its top two executives and said it plans to cut 800 jobs — 10 percent of its U.S. work force — as the hard drive maker endures a bruising slowdown in technology spending. Its stock fell more than 15 percent. In a surprise move, the Scotts Valley-based company announced that William Watkins, 56, Seagate's chief executive since 2004, and Dave Wickersham, 52, the president and chief operating officer, had both left the company, effective immediately.

Corporate affairs & Tax haven headquarters

Seagate Technology US office in Scotts Valley

Seagate was traded for most of its life as a public company under the symbol “SGAT” on the NASDAQ system, then moved to the NYSE system under the symbol “SEG” in the 1990s. In 2000 to reduce income taxes Seagate incorporated in the Grand Cayman Islands. Seagate maintains a nominal headquarters at the Ugland House a headquarters to 18,857 corporations. According to its 2003 annual report, the company reduced its taxes to an effective rate of 2.9%, or $19 million on profit of $660 million. Seagate’s taxes included foreign taxes paid of $40 million and a U.S. tax credit of $21 million, according to the report. In 2000, the company was taken private by an investment group composed of Seagate management, Silver Lake Partners, Texas Pacific Group and others in a three-way merger-spinoff with Veritas Software; Veritas merged with Seagate, which was bought by the investment group. Veritas was then immediately spun off to shareholders, gaining rights to Seagate Software Network and Storage Management Group (with products such as Backup Exec), as well as Seagate's shares in SanDisk and Dragon Systems. Seagate Software Information Management Group was renamed Crystal Decisions in May 2001. Seagate re-entered the public market in December 2002 on the NYSE as "STX."

Siemens AG vs. Seagate Technology

In 2006-08-23, Siemens AG filed a lawsuit against Seagate Technology in U.S. District Court for the Central District of California (Santa Ana) for violating U.S. Patent No. 5,686,838 ('838) owned by Siemens. The patent affected a key component in a sensor-layer system that measures contacts on hard-disk drives on which documents, music, video and other material are compacted and stored. U.S. District Judge James Selna ruled before the trial that Seagate used the technology and infringed the patent.

Siemens later amended its complaint to add Tunnel Magnetic Resistance (TMR) sensors to the case. On 2008-05-09, the court determined that TMR sensors are not covered by the '838 patent, thus eliminating TMR products from the case.[4]

However, in 2008-11-14, a U.S. jury in Santa Ana, California found that even though Seagate had infringed patent '838, Siemens failed to tell U.S. Patent and Trademark Office that it was aware of two professional papers published on the technology by one of the inventors of the IBM patent two years earlier. As a result, the patent was ruled invalid, and the Siemens claim was denied.[5]

Automatic acoustic management and Convolve lawsuit

In 2000-07-13, Convolve Inc. and the Massachusetts Institute of Technology (MIT) filed a lawsuit against Compaq Computer Corp. and Seagate Technology Inc. in the US District Court Southern District of New York, alleging that the defendants had stolen Convolve's computer disk drive technologies (US patents 4,916,635 and 5,638,267) and had been incorporated into Seagate's products as 'Sound Barrier Technology' (SBT).[6][7] In 2001-11-06, claim for US patent 6,314,473 was added to the claim, and Convolve asserted amended Seagate's infringement of patent 6,314,473 in 2002-01-25, which claimed Seagate's infringement was willful.[8]

During the course of lawsuit, National Union Fire Insurance Co. of Pittsburgh claimed the insurers have no duty to defend Seagate, but a federal judge in California ruled that NUFICOP must defend the claim.[9][10]

Although Seagate had tried to suppress evidence from Seagate's opinion counsel's conclusions on attorney-client privilege grounds, Convolve claimed that the evaluation was fair game for discovery. The district court found that Seagate had waived the privilege to all documents within the scope of the waiver as defined in re Echostar Communs. Corp, and ordered Seagate to turn over all documents exchanged amongst outside counsel relating to the alleged use by Seagate of the Convolve patents.[11] Seagate unsuccessfully tried to stay this decision at the district court level before the Federal Circuit stepped in.[12] However, the Federal Circuit determined that the waiver of attorney-client privilege should not be extended to trial counsel.[13]

In 2008, the Board of Patent Appeals and Interferences of the U.S. Patent and Trademark Office ruled in favor of Convolve Inc. and against Seagate Technology Inc. The Board denied Seagate's motions challenging the patentability of Convolve's claims. Seagate did not appeal the Board's decision.[14][15] In 2008-08-20, U.S. Patent and Trademark Office (USPTO) concluded U.S. patent 6,314,473 was valid, without change to the originally issued claim scope. Convolve also filed lawsuit against Dell Computer, Western Digital, Hitachi Global Storage Technologies, Inc., and Hitachi Ltd., asserting the '473 and another patent.[16] In 2009-04-01, USPTO concluded five of the original U.S. Patent 4,916,635 ('635) claim were valid, but the patent had expired during reexamination proceedings. The ruling allowed Convolve to claim damages against Seagate prior to the patent's expiration, with trial beginning in January 2010.[17]

As a result of the lawsuit, Seagate drives has stopped supporting automatic acoustic management on hard drives beginning with Seagate Barracuda 7200.7, before rulings of the trial had been decided. Nevertheless, some Barracuda 7200.7 drives included AAM support.[18] In later products such as Seagate Barracuda 7200.12, the quiet seek mode is set at the factory and cannot be adjusted by end users.[19]

Firmware problems with SATA disks

80GB Seagate SATA laptop hard drive from Acer Aspire 4315 PC.

In late 2008 through 2009, many users of Seagate hard drives began to experience sudden failures of their drives where the drive would spin up, but not be recognized by a PC. It was soon found that the issue was most likely linked to a firmware bug. After much controversy among 7200.11 drive owners due to a lack of response from Seagate on the issue, Seagate confirmed the issue in late January 2009. Problems were compounded by Seagate removing comments on its website message board about the issues.[20]

The company announced that they were working on new firmware to resolve the issue, and that they would offer free data recovery to customers who had data made inaccessible by this issue.[21] The firmware bug is caused by an off-by-one error famously known as the 7200.11 BSY Error, which sets the drive event log to an invalid location causing the drive to become inaccessible.

The affected hard drive families are:

"Click of Death"

In October 2009, a "clicking" noise problem was identified on external and barracuda drives from Seagate. The symptoms are frequent clicking sounds which interrupt the data reading on the hard drive. These problems have been reported on the Seagate forum[28] and in an article from PC Pro (UK).[29] Some participants in the aforementioned Seagate forum report successfully remedying the problem by replacing the USB cable Seagate provides with a higher-quality one or by re-routing the cable to avoid radio frequency interference from other cables.[30] The click of death has most commonly been seen in models where (ST3500641AS) is stated on the box but on the hard drive itself is (ST3500320AS).



  1. ^ a b c d e f Financial statements for Seagate Technologies
  2. ^ "Seagate Technology SEC Filings". U.S. Securities & Exchange Commission. Retrieved 2008-08-02. 
  3. ^ "SEAGATE TO PAY $93 MILLION IN AMSTRAD SUIT". The New York Times. Retrieved 2010-01-30. 
  4. ^ Siemens Seeks $160 Million From Seagate in Trial Over Patent
  5. ^ Siemens Loses Patent-Infringement Trial With Seagate (Update2)
  6. ^ Convolve, Inc., et al v. Compaq Computer Corp, et al
  7. ^ Compaq & Seagate Sued For $800 Million - Company Business and Marketing
  8. ^ United States Court of Appeals for the Federal Circuit Miscellaneous Docket No. 830
  9. ^ Insurers Must Defend Even 'Groundless, False, Fraudulent' Claims
  11. ^ Waiving Attorney-Client Privilege: Patent Opinions Developed by In-House Engineers, Patent Agents and Attorneys
  12. ^ Federal Circuit Decision in Seagate Redefines the Willfulness Standard for Patent Infringement Claims
  13. ^ Waiver from Advice of Counsel Defense Does Not Extend to Trial Counsel: In re Seagate Technology, LLC
  14. ^ The Board of Patent Appeals and Interferences Decides in Favor of Convolve Against Seagate in Disk Drive Technology Interference
  15. ^ Board of Patent in Favor Convolve Against Seagate
  16. ^ PTO Reexamination Finds Convolve Patent Valid
  17. ^ USPTO Finds Convolve Patent Valid in Reexamination - Convolve v. Seagate Patent Trial Set for January 2010
  18. ^ 160G/8mb-cache Faceoff: Samsung vs. Seagate
  19. ^ Seagate's Barracuda 7200.12 hard drive 500GB platters spinning at 7,200RPM
  20. ^ [1]
  21. ^ [2]
  22. ^ [3]
  23. ^ [4]
  24. ^ [5]
  25. ^ [6]
  26. ^ [7]
  27. ^ [8]
  28. ^
  29. ^
  30. ^

External links


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