HDD, processor price increase cause worry among resellers, end-users

The local IT market has witnessed a sudden price increase in two of the most critical components of the PC - Hard Disk Drive (HDD) and processor, over the last week. While price of has shot up by Rs 300, the processor price has increased up to Rs 800 in the fast moving P4 1.7 GHz category. 

However, AMD, a growing competitor to Intel, has kept its price unchanged, giving some relief to the buyers. Meanwhile, there are different versions from vendors, distributors and resellers for this sudden price increase in the HDDs and processors.

The current end-user price of Samsung HDD (40GB) is Rs 5,100 and Seagate 40GB is sold at Rs 4,900. While Intel P4 1.7 GHz processor price as quoted by the distributors is Rs 7,400 (excluding taxes) for the resellers.

"The prices have started to shoot up only from the last week. There are different versions from various sources for this sudden increase in both HDDs and processors. However, the PC price has increased by over Rs 1,000, influencing the buyers decision to wait-and-watch for the prices to come down," said D Raghunath, CEO, Orson Automation.

"We have checked out from all sources about this sudden increase and none seem to give a proper answer. While sources from Intel have said that this is the actual price of the processor and all these days it was sold at a lower price to reach some numbers (targets)," said a leading peripheral dealer in the Ritchie Street market.

"Actually, stocks of both Seagate and Samsung are available, but, not in large numbers. Meanwhile, it is understood that Seagate is shifting to sleeker version (new model) of 40GB drives to keep its fault rate under control. Before this could happen, the production of older models are kept low and existing stocks are being pushed in the market," said another reseller operating out from the same market.

The price of Intel processors has increased across the range by Rs 250 to Rs 300 and P4 1.7 GHz has registered the highest hike of about Rs 800.

"We could not get any proper explanation from Intel for this increase," quipped a reseller.

According to sources close to Intel, the present price increase is not caused by the vendor and it is purely the distributors' decision.

When contacted a leading importer said, "Last month, we had cut down the prices just to reach some numbers and to meet our targets. In fact, we have sold at a loss during the last month and now we have increased the price just to meet the cost of the product. And, still, it is not higher than what we get from the principal."

Meanwhile, an official from a leading distributor quoted, "It is the game of some distributors who are making some quick bucks availing the situations. Seagate's HDDs are available for the same old price and it is only the distributors and resellers who are playing the game."

However, there is no official word from Samsung and Seagate on the sudden increase of their HDDs prices.

"Worldwide Seagate prices are falling and only in India, Seagate has increased the HDD price. Similarly, sources close to Samsung have said that the present increase is due to the close down of a couple of component manufacturing companies (for Samsung) in the US. If Samsung does not plan well, how could we take the responsibility," questioned another reseller.

S Gopikrishna