Stefan Mandl is the Vice President for the China & APAC region for data storage company Western Digital. He was with the company for over 12 years before moving to Asia in March 2017, and holds an MBA from FAU University Erlangen/Nuernberg in Germany.
With the increasing digitalization of industry around the world, the demand for large-scale data storage solutions is accelerating rapidly. China is arguably at the forefront of this wave of digitalization and therefore presents a unique opportunity for business and technological development. Western Digital boasts that 40% of data bits around the world are stored on their media and 35% of NAND—the most common form of data storage devices—were produced by them.
In this interview, Western Digital VP for China and APAC region, Stefan Mandl, discusses developments in demand for data storage technology in China and how Western Digital is adapting to the China market.
1. Western Digital is one of the world’s top data storage solution providers. How is business overall globally and in the China market?
Our business growth globally and in China are both very promising, as the industry’s development soars under accelerated digitalization. With explosive data growth and profound changes in storage demand, we have entered the digital era, enabling us to successfully navigate the pandemic and capitalize on strategic growth opportunities.
The digital economy’s acceleration is driving this data growth and storage demand. Consumers have daily requirements and data infrastructure is being rapidly constructed. With mainstream trends in livestreams and short videos, client equipment demands are increasing for both mobile and PC. In addition, the industry’s technology is constantly evolving. Flash technology continues its advanced development in 3D with higher density, while HDD—Hard Drive—capacity is expanding based on a range of leading technologies.
2. How important is China as a product manufacturing base for Western Digital? How do the R&D efforts in China match R&D efforts in the US or elsewhere?
China is a priority strategic market for Western Digital. According to an IDC report, the global amount of data will be 143 zettabytes (ZB) by 2024, with 36ZB in China—1ZB is equivalent to 1 billion terabytes. However, only about 1.5% of that data will be successfully stored. That indicates a great opportunity for data storage providers such as Western Digital in the China market.
With the excellent achievements in technology innovation, local investment and partner cooperation that we have made here in recent years, and a series of supportive policies such as the focus on “New Infrastructure”—referring to a “digital, smart and innovative” infrastructure—and a more “Digital China” that we have seen, we believe that China has even greater potential in terms of market scale and as a business environment.
In recent years, aside from collaborating with key local clients and partners from various industries, such as data centers, cloud services and the automotive sector, we have expanded factories and established technology centers in China to support the research and development of new products and technologies. Our wholly-owned subsidiary, SanDisk Semiconductor (Shanghai) Co. Ltd., has successfully completed its Phase III Plant Expansion Project in July, 2021, which will advance Western Digital’s product manufacturing and technology R&D, as well as expand its production capacity. The plant will also serve to build a “home away from home” for employees to improve well-being and a sense of belonging.
Additionally, we opened our Shanghai Technology Center for System Integration Testing (SIT) to all customers—a collection of top R&D and test engineers, and hardware equipment that echoes real customer applications. This will enable us to better cooperate with enterprise-level and OEM customers’ products for testing to speed up time to market.
3. Does the China market have any unique requirements in regards to Western Digital’s products?
The China market has been continuously developing at lightning speed, especially in the tech sector, which is closely connected and very beneficial to our storage industry ecosystem. We have also observed great changes in the China market in both enterprise-class and consumer users in recent years.
Following China’s “14th Five-Year Plan” and New Infrastructure goals, many developing markets—such as cloud computing, the Internet of Things (IoT), autonomous vehicles, and artificial intelligence—require leading storage solutions in China. Some emerging industries have especially great potential, such as blockchain, gaming, smart health and smart cities. Meanwhile, digitalization is advancing rapidly across industries, becoming an inseparable part of people’s daily lives and work. Video content is more pervasive, and as the e-commerce industry rapidly develops, so too do related livestreams used to sell products in an entertaining format for customers. Both sides are developing dramatically and form somewhat of a symbiotic relationship.
Because of the available opportunities, we have cooperated with partners in these emerging fields in recent years. For example, we teamed up with open compute organizations ODCC and OCP, supporting them and their users with our leading data center products. Our SN840 SSD—SSDs perform a similar function to Hard Drives in computers—and HC550 SMR HDD have also earned ODCC 2020 Product Awards. In blockchain, we have collaborated with SandStone and Inspur to develop optimized solutions with higher performance and lower costs for clients.
Additionally, we have worked with local partners to unearth additional needs, such as the doubling of demands for storage performance, the pursuit of ultimate Total Cost of Ownership (TCO), and more. Our commitment to answer these needs can be seen in our expanded factories and new technology centers in China to support R&D.
4. Has the nature of the China market resulted in any new strategies in terms of sales and marketing for Western Digital?
The popularity of 5G in the China market not only brings faster network speeds, but also accelerates the implementation and application of IoT, Internet of Vehicles (IoV), AI and other innovative technologies. In this era, a large number of IoT sensors and connected devices have emerged and generated masses of data which needs more reliable solutions to store, and then further explore its value.
For example, in view of automotive storage, we have introduced cutting-edge 3D NAND—a type of non-volatile storage technology—technology, and have released e.MMC—Embedded MultiMedia Controller—and UFS—Universal Flash Storage—solutions to meet the increasing demand of higher capacity, higher performance and higher reliability, particularly for automatic driving and intelligent cockpit systems.
In the consumer market, we have also found that the majority of young consumers in China prefer visualized content, leading livestreaming on e-commerce platforms to prevail. Therefore, we collaborated with top Chinese e-commerce platforms JD.com and Tmall to jointly launch various marketing campaigns and online product promotions tailored to China consumers. We joined hands with JD.com and popular AI robot Sophia on a livestream event for last year’s 618 sales event to better engage young consumers in a more entertaining way, emphasizing the intersection of tech innovation, fashion and` lifestyle.
Our consumer brand SanDisk also has its finger on the pulse of the market and culture, connecting with younger consumers through its communication strategies. We’ve maintained the brand’s relevance in fields that these young consumers love—such as photography, travel and music—on platforms like TikTok, Weibo and RED and in collaboration with KOLs and KOCs to connect these target audiences with the brand’s values.
5. Where do you see the competition coming from over the next decade and how would you rate Chinese competition in the digital storage space?
Looking forward, the amount of data generated in the world is only going to increase—regardless if on the cloud or in end points. Different types of users will have different requirements for their storage capacity, performance, cost, and reliability.
To meet this demand, we pair our own strengths with those of our partners. We own unique capabilities in HDD and flash technologies—in fact, we recently announced an innovative drive architecture that applies OptiNAND technology by optimizing and integrating HDD and iNAND, to sustainably satisfy clients and user needs of the future. And we rely on collaboration with partners across the ecosystem, including key cloud service providers and server providers such as Tencent Cloud, Baidu Cloud and Inspur, as well as R&D partners like Kioxia. We believe that together, we can cultivate a stronger, more effective environment for all industries to create more value from data.
As a data storage provider, Western Digital has unique advantages in both HDD and SSD. We are cooperating with Kioxia on NAND manufacturing and R&D, and have jointly provided more than 30% of the world’s flash storage. We not only have proud technology R&D and innovation capabilities, but also leading advantages in production capacity, and vertical integration in enterprise-class SSD and industry technology. The content we develop, manufacture and sell covers a series of categories including NAND, SSD, HDD and platforms, providing a rich product portfolio of data platforms, connection platforms and technical products, among others, to fully meet the current and future data-centric environment, and requirements for performance, reliability, TCO and sustainability.
6. High read/write speed and low latency are key features of data storage media. Is there any conceivable limit to the speed of data transfer?
High read and write (R/W) speed and low latency refer to the performance of the data storage solution. Considerations for the limitation of speed, capacity, or other performance aspects largely depend on the development of technology. We have observed that Moore’s law—the idea that the number of transistors in a circuit will double roughly every two years—has currently reached the physical barrier in the semiconductor industry, but it still applies to the field of flash memory.
In order to continuously advance our progress and meet the growing global demand for data storage, it is very important to expand and innovate on 3D flash memory. Accordingly, this year, Western Digital and our partner Kioxia jointly developed the sixth-generation 162-layer 3D flash memory technology, which is a higher-density and more advanced 3D flash memory technology. Now we store 40% of the bits in the world on our media and produce 35% of NAND worldwide. We serve all the markets and all the verticals.
We also have energy-assisted magnetic recording (EAMR) technology, the industry’s first triple-stage actuator (TSA), and a sixth-generation product with HelioSeal technology. All of these extend across our enhanced portfolio to deliver the highest areal density and unmatched TCO for HDD. For example, when we replace 14TB HDDs with higher capacity products, but at the same storage capacity, both the server deployment cost and operation cost will dramatically reduce, thus cutting down the total cost of ownership. With those leading HDD technologies providing higher density and lower cost, we can enable our clients—such as Communications Service Providers, enterprises and smart video partners—to meet the demands of more effective data storage solutions and optimized storage infrastructure, in the face of the forthcoming boom in data.
7. How did your relationships with key clients arise and what is the role of Western Digital in the cooperation?
With today’s accelerated digital transformation to “online everything”, data storage in every field is under pressure like never before. Western Digital understands the needs of those clients across different industries.
Instead of merely providing products, we go further and get closer to clients, fully understanding their advantages and needs. By applying our storage products, integrated with their applications, we combine the advantages of both parties to better utilize the dividends brought by our technology, and create storage solutions that are more suitable for users. In the blockchain field, we’ve communicated closely with software providers like SandStone and XSKY, and collaborate on their software updates and integration with our products, delivering better application solutions to end users.