With all the flooding in Thailand where many of the HDDs are made that are used in computers and sold on the retail market, production has ground to a halt leaving shortages on the market. There was an early prediction that the shortage would hurt more than just the consumer with computer prices going up and could also hurt large internet companies like Google and Facebook.
According to HP CEO Meg Whitman, the shortage is already hurting Facebook and Google since they are the DIY server sort. HP is also having a hard time laying hands on drives, but Whitman says that the firm has a “war room” set up and it will be getting its share of drives. Whitman also claims that for now since Google and Facebook cannot get drives, they are calling HP to meet server needs.
Despite the uptick in purchases from firms that typically build their own servers, Whitman still expects income for servers to drop thanks to the shortage. Computer prices are expected to increase with the shortage. The real brunt of the pinch from shortages will hit in Q1 and Q2 according to Whitman. HP released its Q4 financials this week.