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Industry watchers are speculating about the future of Western Digital Corp. as the computer disk drive industry weathers a critical transition.
Some industry and financial analysts are betting that Irvine-based Western Digital could be acquired in a round of industry consolidation. In a historical irony, analysts say the most likely suitor for Western Digital would be IBM Corp. Western Digital chairman and CEO Charles Haggerty spent 28 years at IBM before joining Western Digital in 1992.
"There are a lot of rumors about IBM and Western Digital," says Alexa McCloughan, an analyst with Framingham, Mass.-based International Data Corp. "On paper, it has some logic to it."
Western Digital spokesman Bob Blair declined to comment, saying his company doesn't address market rumors. A spokeswoman for IBM also declined to comment. She did note that Western Digital is a buyer of IBM components for use in its drives.
Some analysts think Armonk, N.Y.-based IBM needs an outlet for its disk drive technology. In November, Big Blue announced a new component that stands to boost today's largest personal computer drives to 16.8 gigabytes. With its so-called giant magnetoresistive heads, IBM is aiming to bring high-performance disk drives to desktop PCs, an untapped market for the company. For that, analysts say, IBM could be seeking entry to the desktop market.
According to fourth-quarter IDC figures, IBM is the industry's No. 4 drive maker behind Scotts Valley-based Seagate Technology Inc., Milpitas-based...