Ready for the next step

Editorial Type: Interview Date: 2019-07-01 Views: 993 Tags: Storage, HDD, SSD, Cloud, Security, Verbatim, Freecom PDF Version:
This year isn't just the 50th anniversary of the moon landings - it also sees 50 years of Verbatim. Storage magazine editor David Tyler speaks with the company's president, Clive Alberts

Dave Tyler: This is an interesting time to catch up with Verbatim, as on the one hand you are in your 50th year as a business, and also the company has only very recently changed ownership. Tell us how Verbatim came to be where it is today.
Clive Alberts: Verbatim is a true storage company - that is our heritage. The business started in a garage in 1969 manufacturing data cassettes, then of course the infamous floppy disk, a product in which we were the market leader for many decades, all over the world. It has been a key ongoing strategy within Verbatim throughout those fifty years, in order to secure our future, to always be open to new business environments. So this has meant adding new product categories, but also adding new business units that might perhaps seem unconnected to storage - from lighting to 3D printing. This reflects Verbatim's flexibility as a business: we are always prepared for change.

The idea of change has played an important part in our history: we've changed ownership at various times, of course, including to Eastman Kodak in the 80s. As part of Mitsubishi Chemical since 1990 we have established ourselves as the genuine success story of optical media. That relationship positioned Verbatim ideally to produce the very highest quality premium optical discs, clearly distinguishing our product from the many others on the market.

There has now been a further change announced which we see as a continuation of our success story: Verbatim has been acquired by our biggest supplier, CMC Magnetics Corporation, the number one producer of optical media discs. This will allow us to - in what is something of a declining market overall - take on huge market share. Integration with CMC will also allow us to address new segments that we weren't previously able to cover with the Verbatim brand alone, so we see lots of new opportunities in waiting for us from now on.

DT: How will the latest change of ownership affect the product strategy of the company? What will happen to the Freecom brand, for example?
CA: We see this latest announcement as an opportunity to invest in and grow new businesses - one of particular interest to us is the Internet of Things. We're looking at smart home security for example as an area we intend to build on over the next few months. It is an exciting time for us, we feel that at Verbatim we are always prepared for what's coming next, and we are always ready for change.

CMC Magnetics has had a very strong relationship with Mitsubishi Chemical over the last 30 or 40 years, and this will continue. CMC also has a number of relevant IPs, and very high technical expertise in the production of optical media discs. So we will actually be gaining significant additional knowledge that will help us to improve the standing of the Verbatim brand in the optical media market - a standing that is, in any case, already very high as we are the clear market leader; so we can only get better. It is a true win-win situation both for Verbatim as a brand and for CMC as a manufacturer.

We will continue with Freecom - at the end of the day we will have several different brands within the organisation, as we further define the market segments and position our brands accordingly. Freecom is perceived as a premium-oriented brand in the market, and we would definitely be looking to continue to bring more such premium products to market. These would mainly be external storage devices, hard drives of course but also external SSDs - we've recognised that the market for external SSD products is growing, so it makes sense for the Freecom brand to focus more and more on SSD solutions.

DT: You mentioned security as part of a planned IoT development - how important is security to storage vendors right now?
CA: We can of course offer the storage aspect of a smart home solution, whether that is based on memory cards or also external hard drives, but in the smart home security market we are actually talking about supplying a complete solution. This means not just the hardware but also the software that works with it. So, surveillance, different types of sensors, everything within that environment that allows you to link and communicate with each other - all steered via a single app, which is very important. This is a key point for the convenience of the user. We've been working toward this for some time. It is clear that the whole topic of security aligns very well with the Verbatim brand - our users already recognise us as a serious and trustworthy brand. This is proving useful to us in our IoT developments of course, but we are also now looking at other areas within our storage portfolio where we might exploit this security awareness. We're bringing out a couple of new security-related storage products, such as the fingerprint-protected USB drive announced recently, as well as a fingerprint-protected hard drive. We plan to have a range of offerings that fit into an overall family of security-oriented products.

All businesses are facing higher requirements in terms of security and compliance - GDPR of course has been a significant driver in this category over the last year. There is high demand, especially from corporate customers as you'd expect, but also from individual consumers who are increasingly on the lookout for easy to use, but secure, systems to protect their data. Users at all levels are demanding solutions - particularly mobile - which are easy to use, don't require entering a password into a software application, but do not compromise on the security aspects. For this reason we are focusing more on hardware-related encryption solutions.

DT: How do you see the broader outlook for the storage sector itself, and how Verbatim fits in with that view?
CA: There are a lot of changes happening across the industry, as user demand itself changes. Data is being created everywhere, content is available everywhere thanks to the cloud, so we have to be ready for that in our product planning, whether that is our external drives or optical media. At the end of the day users need both local storage and cloud - but there's nothing to say that Verbatim might not offer some kind of cloud capacity as well as local storage in a future offering. As we touched on earlier when discussing the smart home security project, we have to recognise cloud as being a key part of any comprehensive solution.

At the same time there is a very strong install base of users who are very focused on keeping their data local and keeping it with them at all times, and protected. The change of ownership is empowering us to look at expanding into some new markets as well as growing share in our established markets. We see a definite move away from external hard drives toward SSD, for instance, in the consumer market, so we expect to grow that part of our business. This is partly as prices become more comparable, but also because of the more attractive specifications of SSDs in terms of speed of data access, mobility etc. Our internal SSD offerings have already been doing very well for a while, so it is a logical step for us to expand our share of the external market as well. This will definitely be a growth category for Verbatim going forward.
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"There is high demand, especially from corporate customers as you'd expect, but also from individual consumers on the lookout for easy to use, but secure, systems to protect their data. Users at all levels are demanding solutions - particularly mobile - which are easy to use, don't require entering a password into a software application, but do not compromise on the security aspects."