Spinning magnetic Disc-based storage mostly sold by HP, EMC, NetApp and many others are faced with a competition from flash. Toshiba invented the flash technology back in 1984. Chips stored data when the device even turned off and uses less energy, works faster and require less space. Memory cards and USB memory sticks started to use the technology first and around year 2000 much more uses were added to the roster. New chip technology allowed it to produce cheaper chips and allow it to store more data. This paved the way for flash chips to be used even in data centers. Sales of flash chips are expected to rise to $1.6 billion a year by 2016.

Some data centers faced with disc-storage limitations are switching over to flash. The popularity of data centers within last few years creates a steady demand for flash chip makers. This may be why traditional storage makers are acquiring startup flash chip manufacturers to get into the game. The disc-based storage leader EMC acquired three startups within last few years. With the number of flash makers entering the competition, prices of flash are seen lot of pressure and expected to go even further down.