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Hard drives out of stock
10-26-2011, 06:40 PM

As you know, there has been a lot of flooding in Thailand and several hard drives production plants of Western have stopped. The global demand goes through Seagate and Hitachi but they can not deliver everyone. Being a large customer, in September and October we have had a priority access to global stocks. However it starts to become very tense. For November, we will be delivered 20 % of our orders and we learn the restart of factories in Thailand is expected for January 2012! In December and January they will deliver 10 % of our orders, which is practically nothing!

If we want to continue to provide you with the servers in 1 hour there are not many solutions.

1. We need new hard drives for new servers. So the new discs will be now put in place only on assembly lines.

2. The servers that have been put into production and are used for a few months but are not renewed, usually their hard drive is changed by a new one. This allows us to guarantee that a freshly rented server has a disk less than 1000 hours. We stop this operation to avoid running out of stock too fast. So if your server is delivered in October, November, December and January, you will therefore have a probability to get a server with a disk of 4-10 months. The data has been erased by a low level formatting, but the disc will have been used already a few months.

It is not known yet whether this (small) change will be sufficient to maintain the stock server available at 1 hour. Honestly we doubt it as we are talking about January and since OVH uses about 20 000 hard drives a month. It is likely we will be out of stock for few days or even maybe some weeks on certain types or on all of our servers. We don’t know yet. Therefore we advise you to order your new servers enough in advance and not at the last minute. If you change the server to a new one, it is best to postpone it to January or February. It is quite likely that on a given time we have to block certain orders and priority will be given to new customers who don’t yet have a server at OVH. Or to do the renewal for three months to avoid the turn-over until February. We do not yet know how we will manage these 4 months, it will be rather delicate.

This is a very special situation and we are not comfortable with it. Globalisation for some means only the cost reduction with taking maximum risk for the entire the planet instead of the distribution of risk on different production areas and a better adaptation to the demand. The plants are financially calculated to turn 100 % of the time at 100 % of capacity in order to maximize the return on investment. We see very quickly that the goal is not to sell and take advantage of growth opportunities on the market, but to manage costs and maximize income, even if it means that not all demand is satisfied. This world is not going in the right direction and forces us to make decisions that are not in accordance with the spirit in which we want to evolve. But our responsibility is also to avoid the wall that we see forming in front of us and therefore to take needed actions well before and gently.

Best regards