Should I buy a Big Hard Drive or a Little Hard Drive?

I mentioned the other day that I'm looking to buy an external hard drive for our home use.   I plan to setup the drive to automatically backup our primary computer.   My first inclination was to get a 500GB drive since that is more than enough for my current needs.   I found a Seagate model for $50.  However there are also 1TB drives for around $70.   If I bought that then I would get twice as much storage for just $20 more.   I also even found a sale deal for Seagate 2TB drives for $80.   That would give me 4 times as much storage for only $30 more.

So what drive should I buy?    Should I buy the cheapest drive that meets my immediate needs?    Or should I pay more and get the bigger drives and have a lot of room to expand for the future?

500GB - cheaper and meets my current needs:   The 500GB drive would be more than enough for now.   Our computer only has around 250GB in space on it so a 500GB drive would be double what I need for backup purposes.  I could upgrade our computer in the next year or two since its pretty old right now.  But I think the 500GB would still be good enough for a while even if I do upgrade the computer.  Our storage requirements aren't that high. 

500GB would be plenty for now.    I expect it should easily suffice for at least a couple years if not longer.

2TB - Better cost / size bargain and will meet our needs longer :  If I were to buy the 2TB drive (1TB = 1000GB) on sale then I would be getting an extra 1.5TB for just $30 more.   That is a very good bargain for that much additional storage.   The 500GB drive is 10¢ per GB and the 2TB drive is just 4¢ per GB.   The 2TB drive is a much better bargain in this respect.

Of course I wouldn't buy the 2TB if I will never need the extra 1.5TB of space.   But eventually I'm sure I can use that extra space in years down the road.   That will keep me from having to get yet another bigger drive 2, 3 or 5 years from now.    It would seem that paying 60% more to get 4 times as much storage is a great bargain so I was tempted to get the 2TB drive and declare it a great deal.   But then I looked closely at the cost of hard drives over time and reminded myself of just how fast the cost drops for this technology.

I'm now looking at these 2 options:

1) Spend $50 today and get 500GB which will last 2-3 years.   Then 2-3 years from now buy another drive to get 1TB or more to meet future needs.
2) Spend $80 today and get 2TB that should last 4+ years easily.

Essentially the question boils down to :
Do I buy a cheaper smaller drive every 2 years or a larger drive every 4 years?

If the price of the item were going up over time then it would make sense to buy the bigger one today I think.
Say for example that harddrives went up in cost 10% a year and so 2 years from now the 500GB drive was $60.50.   I'd then be spending    $50 and then $60 over 4 years instead of $80 today.  That would make the purchase of the larger drive now the clear winner.

However hard drives drop in price pretty fast over time.  The 120GB drive I bought a few years ago was $110.   If I had bought a 600GB+ external drive 3 years ago I'd have probably spent more like $175 or 200.
In hind sight if I'd bought a big drive with lots of extra storage then I'd have been spending more than the $110 I've spent plus the $50 I'm looking at now.

Since hard drives drop in cost so fast I think it makes a lot more sense to buy only what you need for the short term use rather than buying a LOT more than what you need just to get a bargain price.   The prices in 3-4 years will be a much better bargain then buying the extra capacity today.

There are some other key items that the cost drops significantly over time.   Most electronics are in that category in general.  Computers, televisions, smart phones, ipods, etc all tend to go down in price or at least give you much better product in future years for the same price.   Theres numerous examples of this and I'm sure you're familiar with the phenomenon.   That $800 computer you're thinking of buying today probably be sold for $250 in 2-3 years.    The ipod you get today will be half as good as the model sold in a couple years.   My 55" TV costs 50% more than a 60" TV would cost today.

Bottom Line : For hard drives and other electronics I think it generally makes sense to buy the cheaper option that will meet your needs today then upgrade in the future when you need more instead of buying the better and more expensive item today and upgrading less frequently.

FREE 21 Baby Genius + 20 other kids song downloads

BabyGenius is offering 21 free songs for download.  

Plus Amazon.com : 
Five Super Silly Songs from Veggietales
The Wiggles Summer 2011 Sampler
Cedarmont Kids Sampler For Moms
Sesame Street: Amazon Sampler
The free Amazon samplers are 5 songs per album so thats 20 more total.


I heard about this one via Fatwallet.

History of Hard Drive Costs

I mentioned yesterday that I'm shopping for harddrives.    The current external harddrive that I have is an older 120GB model that cost me about $110 in Nov. 2005.   Today I'm looking at 1-2 TB models that run $70 or $80 range.  If I remember right around 15-18 years ago I spent something like $200 or $300 for a 300 MB harddrive.   The price of harddrives drops like a rock over time.

This nice article Cost of Hard Drive Space compiles a lot of data on the history of harddrive costs over the years.  

Here's a few data points to illustrate the history of hard drive costs over the decades.


1985 : 10 megabytes cost $710.    Today 10 megabytes of storage is nothing. Today you can get blank DVD discs in bulk for as cheap as 18¢ and those are over 4GB.    So today that 10MB of space is 0.045¢.  

1995 : 1 GB cost $849.   Ten years later you could get about 100 times the capacity for about 20% more.  Yet today that 1GB would easily fit on a 18¢ DVD with 3GB to spare.


2005 : 200 GB for $100.   Another 10 years later and you could get 200 times as much storage for almost 10% the cost.  

2011 : Today you can pretty easily find a 1 TB drive for $50 range.    In 6 years the cost has dropped in half and you get five times as much.

I took some of the data points from the Cost of Hard Drive Space page and plotted a chart.  I'm showing just the costs over the 2000 to 2010 period.    The yellow dotted line is the trend line.

In October 2000 you could get a drive for about $7.14 per GB.   By August 2010 the cost had dropped to just 8¢ per GB.    Over that time period thats a compound rate of -36% annually.   In general over the past decade hard drive costs have dropped approximately 36% each year on average.

Brand Loyalty

Today I have been shopping around for a couple computer related items.  I decided that I'd like to get a new external hard drive that we can use to backup our main home computer.    I also am almost out of DVD blank discs so I need to buy some more of those.  While shopping for these I realized that my own brand loyalty was greatly influencing my shopping and purchase decision.

External Hard drive shopping

First I shopped around for the hard drives.   On Newegg there are a ton of different brands for external hard drives.  Some of those brands are pretty cheap but I've never heard of the brand name before.   I quickly decided that I didn't want to risk buying a harddrive from a company I've never heard of just to save a few bucks.   If our back harddrive dies on us then we could potentially lose a lot of important stuff.   The two brands that I quickly focused on where Seagate and Western Digital.   Both are well known hard drive makers.   In the past I have bought Western Digital drives and been happy with them and I know they've also had a good reputation for many years.    The 500GB Seagate drive is $49 on Newegg and the 500GB Western Digital is $70.   I also shopped around and found a 500GB Western Digital drive for $60 + $7 shipping at Amazon.    So I'm looking at $49 for Seagate or $67 for Western Digital.   The Seagate drive is 26% cheaper than the Western Digital.   I'm still inclined to buy the Western Digital since I know the brand and I've been generally happy with it in the past.

DVD media shopping

Amazon has some products they sell under their own brand of 'Amazon Basics'.   The DVD-R's they sell are $18 for a spindle of 100.    Thats 18¢ each.    The other common name brand DVD blanks start around $20 for 100 or 20¢ each.   

TDK 4.7GB 16x DVD-R (100-Pack Spindle) $19.99
AmazonBasics 4.7 GB 16x DVD+R (100-Pack Spindle) $17.99

The reviews are roughly similar with either getting around 4 stars with lots of reviews.   The AmazonBasic product is 10% cheaper.   Yet I'm still thinking I'd prefer to get the brand that I bought last time cause I know it works and I was happy with it.   The brand I have now worked fine for me and I don't know how well the Amazon brand discs will actually work.  DVD players and recorders can sometimes be finicky about recordable DVDs and its not uncommon to get some bad discs in a spindle from some vendors.

For these two purchases I am willing to spend 10-25% more for the more expensive brand out of brand loyalty.

Smart or a Waste of Money?

I think that brand loyalty makes a lot of sense in many ways.   If you know a company makes products that work well and fit your needs then why not buy from them again?   If you buy a product from a company you're unfamiliar with then you're taking a risk that their product is not as good.   If you are happy with the company and the product all around then its a safe bet to buy from them again.

On the other hand just because the last product you bought from a company worked OK that doesn't mean their products are necessarily higher quality or more reliable than a cheaper alternative.  I think brand loyalty can make more sense if its not based on your individual perception and/or your experiences with just one or two previous purchases.

The status quo can be a strong motivator.    This is good and bad.    If you stick to what you know then you don't have the as much risk of being disappointed in general.   You were happy the last time you bought the brand so why not buy it again?   It may keep me buying a more expensive brand that isn't really that much better and  keep me from ever trying a cheaper brand that is just as good.  

Sometimes Just a Matter of Tastes

For some things brand loyalty is just a matter of personal taste.  Consider food items.   Whether or not you buy Coke or Pepsi or another brand of soda is really up to your own personal tastes.  If you like Coke then you like Coke and it makes perfect sense to keep buying the soda that you enjoy the taste of.   Other peoples opinions about Pepsi shouldn't matter much.   Other things fit into the same category like perfume, clothing, movies, video games, etc.

So what?

OK so I feel like I rambled a little bit in this article.    Sorry.   So whats the point?   The lesson here for myself is that I should be aware of my brand loyalties and question them.   Did I really have a good reason to pay 10% more for Western Digital over Seagate?   Not especially.   Both are great brands that have good reviews.  But Western Digital is the status quo choice.     When looking at the DVD purchases I had another good reason to stick to the brand I know which is that some DVD brands can have problems.  In that case there is more risk and I can't rely entirely on 3rd party opinions there either.   In this case it may make sense to stick to the option that I know works since there is more real risk of failure with unknown brands. 

Bottom Line :   Brand loyalty can be a good thing or can cause us to waste money while we cling to the status quo.   If you're shopping then I'd question how much brand loyalty really matters and how much it may be worth spending on.