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SSD Manufacturer OCZ Preparing For Bankruptcy 182

Posted by Soulskill
from the all-about-the-benjamins dept.
JDG1980 writes "OCZ, a manufacturer of solid-state drives, says it will file for bankruptcy. This move is being forced by Hercules Technology Growth Capital, which had lent $30 million to OCZ under terms that were later breached. The most likely outcome of this bankruptcy is that OCZ's assets (including the Indilinx controller IP) will be purchased by Toshiba. If this deal falls through, the company will be liquidated. No word yet on what a Toshiba purchase would mean in terms of warranty support for OCZ's notoriously unreliable drives."
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SSD Manufacturer OCZ Preparing For Bankruptcy

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  • ...and (Score:5, Insightful)

    by Konster (252488) on Wednesday November 27, 2013 @08:06PM (#45544395)

    ...and not a single customer was surprised.

    • by Cwix (1671282)

      I actually kinda am, I purchased one of their drives over a year ago and I have had no reason to complain about it. But that was just one drive, if there was news about issues, I missed it somehow.

      • Re:...and (Score:4, Interesting)

        by Konster (252488) on Wednesday November 27, 2013 @08:40PM (#45544807)

        They had loads of issues with their early drives for a few years.

        They got rid of the CEO, and changed their approach to quality, but it was too late. Their Vector drives are pretty decent, but they had no one to buy them.

        • by Cwix (1671282)

          Obviously I missed all that. I must have been lucky, I have a vertex 3.

          • I have 3x Vertex 3's, 1x Vertex 4, at least 3x sets of RAM, all with year(s) under their belts(oldest SSDs from 2011) and I have never had an inkling of a problem. Newegg reviews seemed to agree.

            I'm very surprised at this or perceived quality control issues.
            • Re: ...and (Score:5, Interesting)

              by Hadlock (143607) on Thursday November 28, 2013 @02:34AM (#45546695) Homepage Journal

              European retailers publish their return rates by brand, OCZ has consistently been #1 by a wide margin, sometimes having as high as one in five (that's 20% for those of you following along at home) return rates for some models, the brand as a whole has been at around 8% for almost two years now. They're ticking time bombs. By contrast, intel, samsung et all generally have a return rate around 2% which is standard for retail items in general. Something is obviously very wrong. Also you should note that OEMs do not touch OCZ products with a 20 ft pole, you can only buy them at retail which should be a huge red flag.

      • by gigaherz (2653757)
        Agreed: Both my Vertex3 and my Vertex4 work perfectly well. I did have some issue with the Vertex3 at the beginning, but it was easily fixed with a firmware update.
    • by ganjadude (952775)
      I kind of am, I havent got one of their SSDs however I have always loved their memory. in typical /. fashion i havent RTFA but I am assuming this is the same OCZ
      • by AmiMoJo (196126) *

        Their problem was that they tried to engineer their own SSDs and become a major player. Before when they were just doing RAM they basically bought the chips from someone else, copy/pasted the reference DIMM design and stuck their own heatsink on it.

        Their early SSDs had a lot of firmware issues, and they handled them badly. They also did douchbag things like reducing the capacity of existing products without any indication or model number change when they figured out that they hadn't left enough spare space

    • Re:...and (Score:5, Insightful)

      by Joce640k (829181) on Wednesday November 27, 2013 @09:04PM (#45545005) Homepage

      Note to self: Don't buy any new Toshiba-manufactured SSDs...

    • by Lehk228 (705449)
      their single customer appears to have been suprised
    • by Dogtanian (588974)

      ...and not a single customer was surprised.

      Yes, everyone is assuming that OCZ went under because their drives were rubbish. I'd say that was the most likely cause too, but it's still (a) an assumption and (b) won't be the reason they went under in itself. No-one so far has actually answered that question!

      What I mean is that companies don't go bankrupt because they sell rubbish- they go bankrupt because of the *financial consequences* of selling rubbish. (*) In particular, I'd like to know...

      (i) Was OCZ's bankruptcy due to losses caused by a ver

  • Warranties (Score:5, Funny)

    by Anne_Nonymous (313852) on Wednesday November 27, 2013 @08:07PM (#45544401) Homepage Journal

    >> No word yet on what a Toshiba purchase would mean in terms of warranty support for OCZ's notoriously unreliable drives

    You can expect the same level of warranty service that you've always received from OCZ.

    • by SeaFox (739806)

      You can expect the same level of warranty service that you've always received from OCZ.

      Yes, that is a stupid supposition for the summary to make.

      The warranty is a legal obligation, and one a company would have a responsibility to fulfill, and if the company is bought by someone else, it becomes their obligation.

      • by Dunbal (464142) *
        They welched on $30 million, you think they have trouble not fulfilling their warranty "legal obligation"?
        • by EdIII (1114411)

          I think the question was about Toshiba handling the warranties. If Toshiba buys them, they will need to honor the warranties. OTOH, if they just purchase IP they will not need to do so.

      • Re:Warranties (Score:4, Informative)

        by PopeRatzo (965947) on Wednesday November 27, 2013 @08:46PM (#45544865) Homepage Journal

        The warranty is a legal obligation, and one a company would have a responsibility to fulfill, and if the company is bought by someone else, it becomes their obligation.

        Sure, if you wanna face an arbitration panel hand-picked from corporate lawyers.

        Anyway, it doesn't say the drives will be purchased by Toshiba, just the controller technology.

        When a company goes bankrupt and another company picks its bones, the first thing to go by the wayside are things like pensions, guarantees, municipal contracts and similar agreements. Toshiba's lawyers will get them out of those warranties faster than a drunk sophomore gets out of a prom dress.

        • by Mashiki (184564)

          You might think so, but it sure didn't work for fujitsu now did it? Warranty coverage and "who picks it up" varies by where you live, in Canada, I got cold hard cash for every drive I sent back to them as they failed.

          • by PopeRatzo (965947)

            That's because you live in a relatively civilized country where people still matter.

          • Re:Warranties (Score:4, Interesting)

            by Guspaz (556486) on Thursday November 28, 2013 @02:04PM (#45549913)

            Speaking of Toshiba and Canada... I live in Canada, and bought a Toshiba laptop in America after being assured by Toshiba (I called them) that the warranty was international and that I should have no problems at all getting it serviced if there was a problem. The text of the warranty also said as much. The only caveat, they said, was that I'd have to pay the shipping costs out of my own pocket, which was expected.

            Fast forward a year and a half, and my laptop needs service. I call up Toshiba Canada, and not surprisingly they won't touch the thing because of where it was purchased. So then I call up Toshiba USA, and... they tell me their repair depot will refuse any packages shipped from outside the US. In fact, Toshiba tells me to find an American friend to ship it to and then have them ship it to Toshiba...

            Needless to say, my replacement laptop was not a Toshiba.

      • Re:Warranties (Score:5, Informative)

        by ArbitraryName (3391191) on Wednesday November 27, 2013 @09:15PM (#45545075)
        Incorrect. Warranties are considered unsecured liabilities. Once the company files for (Chapter 7) bankruptcy they stop honoring warranties just like they stop paying debts. The company's assets are sold and creditors are repaid in a set order. Unsecured debts are absolutely dead last and are generally never paid (after all, if they could have paid them they wouldn't likely be filing bankruptcy. Assets sold in bankruptcy are free from any liens or claims. Toshiba would be under no obligation to warranty any OCZ products, as they would have simply purchased their assets.
        • those expanded warranties they introduced to compete with Samsung came to mind. I wonder if they were being sincerely offered in the first place, or if they were just a gamble against what time they had left.

          • by Kjella (173770)

            Most likely a sincere do-or-die attempt, they probably hoped for enough sales through that to turn things around. Whether that hope was realistic or they were just grasping at straws I don't know, either way the attempt was free and a slim chance to save the company beats doing nothing and going bankrupt for sure, at least from OCZ's perspective. They might have burned a lot more customers that way, but it reminds me a little of an "Ask Slashdot" about a small CEO/investor introducing hellish work hours and

        • by AmiMoJo (196126) *

          I assume you are talking about the US. In the EU your warranty is with the vendor and is for a minimum of two years. If the drive fails the shop you bought it from must handle the warranty, even if the manufacturer is long gone. You can choose to directly to the manufacturer if you like and they allow it.

          In my experience with storage devices if either the shop or manufacturer goes out of business the other one will usually honour the warranty. I had an Intel SSD from a shop that vanished and Intel replaced

      • Re:Warranties (Score:5, Informative)

        by FatdogHaiku (978357) on Wednesday November 27, 2013 @09:17PM (#45545087)
        Unless Toshiba actually agrees to assume the liabilities of OCZ (and WHY would they do that?) then no, the obligation to cover old products is not transferred. If a building contractor goes belly up and you buy his assets (materials, vehicles, tools & equipment, unsold inventory, client lists, etc.) that does not make you responsible for work he did in the past. Now, "if" you keep the brand alive you would most likely have to stand behind previous commitments, but again WHY would Toshiba do that? Toshiba is solid and OCZ is on fire. Toshiba will gain new IP and physical plants and resources and OCZ will be ash. Shareholders will get pennies on the dollar, customers will get screwed without lube. For warranty inquiries, contact the bankruptcy trustee.
        • by citizenr (871508)

          Unless Toshiba actually agrees to assume the liabilities of OCZ (and WHY would they do that?)

          Only one reason comes to mind - in order to preserve OCZ brand name. This brand is still associated with crazy fast drives. People in the industry know this is due to OCZ blatantly lying to customers and advertising compressed data speed, but perception of unwashed masses remains.
          Of course OCZ is also associated woth total lack of RMA support, and most people that had to go thru RMA never bought OCZ again.

      • by sjames (1099)

        They'll just spin off and sell off anything of value and leave an empty shell to go bankrupt.

      • by russotto (537200)

        The warranty is a legal obligation, and one a company would have a responsibility to fulfill, and if the company is bought by someone else, it becomes their obligation.

        Only if they bought the company whole. If the company goes bankrupt and Toshiba buys "substantially all the assets of" the company, they may not get the obligations.

      • by nuggz (69912)

        Unless they don't buy that part of the business.

        The whole point of a bankruptcy is to get rid of excess obligations.

      • by Luckyo (1726890)

        They likely will buy some assets from the liquidation, but not others. As a result, they likely won't be bound by warranty agreements.

      • by Firethorn (177587)

        The warranty is a legal obligation, and one a company would have a responsibility to fulfill, and if the company is bought by someone else, it becomes their obligation.

        It depends on how the company was bought. Once it hits the bankruptcy court everything is up to grabs, and warranty coverage is a debt. Generally a company that buys it 'stock and barrel' will end up honoring the warranties, but it's not a guarantee.

      • "The warranty is a legal obligation, and one a company would have a responsibility to fulfill, and if the company is bought by someone else, it becomes their obligation."

        That would be nice. However, if the sale is structured as a partial asset acquisition, rather than a sale of the whole company as an entity, it may or may not be true. The details are brutally complex and varied; but it cannot be safely assumed that a few tedious 'obligations' (especially to a class of very small claimants, who are unlik
      • by Lehk228 (705449)
        bankruptcy is a formal process of eliminating legal obligations which have become impossible to fulfill.
    • by guises (2423402)
      Back when OCZ was a memory company, they provided really excellent service the couple of times that I had to deal with them. And lifetime warranties for their RAM. They were also pretty much the only good option available in Canada that wasn't way too expensive. I'm genuinely very sorry to see them go.
  • by slashmydots (2189826) on Wednesday November 27, 2013 @08:11PM (#45544431)
    Their drives don't have a high failure rate! They're not unreliable! It was all based on a single study that showed a high return rate. That was because the morons at OCZ released them with beta level firmware that made the first batch of 3 and 4 series drives not be recognized 100% of the time by many BIOSes. I built over 50 computers with OCZ SSDs and about 40 of them had to be flashed to the latest firmware before they operated correctly. After that, zero out of 50 came back in 2 years so that means zero failed. They used 9000 write cycle flash memory instead of, for example, Kingston HyperX 3K's 3000 rating. They had an internal, firmware-based TRIM style sweep in case your OS didn't support TRIM too. They were one of the best drives out there.
    Unfortunately, I hate them because they decided to "stop being competitive" and single handedly drove up the price of SSDs basically by price fixing. Their drives went up 50% in price overnight. That was such bullshit, they deserve bankruptcy.
    • by 0123456 (636235) on Wednesday November 27, 2013 @08:24PM (#45544599)

      I built over 50 computers with OCZ SSDs and about 40 of them had to be flashed to the latest firmware before they operated correctly.

      In some parts of the universe, we call not working correctly 80% of the time 'unreliable'.

      Even if it's fixed, that kind of reputation hangs around for a long time.

      • by iCEBaLM (34905) <icebalm@icebalm.LISPcom minus language> on Wednesday November 27, 2013 @08:44PM (#45544841)

        But they're not incorrectly working 80% of the time, they're incorrectly working once, fixed, and then they work for the rest of the products life.

        • by 0123456 (636235) on Wednesday November 27, 2013 @09:40PM (#45545235)

          But they're not incorrectly working 80% of the time, they're incorrectly working once, fixed, and then they work for the rest of the products life.

          So they magically fix themselves?

          If I buy something, I want it to work out of the box. If it didn't work out of the box 80% of the time, I'd call it 'unreliable'. I wouldn't care whether I can download some program from the Internet to fix it, you'd already have lost me as a customer.

          • By which standard, Windows is almost 100% unreliable. No wonder I hate on it.

            • by hairyfeet (841228)

              Flag on the play, dumbass on the field, 15 yard penalty.

              I build PCs for a living and have since the days of The Shat selling VIC 20s with his TJ Hooker hair and if "Windows is almost 100% unreliable" for you then 1.- You haven't touched Windows since Win98SE, or more likely 2.- you sir are a moron who clicks on every "punch the clown and win an iPad" ad on the next and clicky clicky through every EULA you get from any dodgy site. So which is it?

              as for TFA? Couldn't happen to a shittier company. I have sev

        • by Luckyo (1726890)

          In any computer part, a failure rate that causes catastrophic data loss with 1/5 chance is unacceptable.

        • by smash (1351)
          No, they were sold DOA. Having to somehow flash firmware on a storage device typically used for a system drive on a new PC before I can expect to use it is inexcusable.
        • by AmiMoJo (196126) *

          That might just be acceptable if you had a second PC that it happened to work fine with to do the update on, and of course know that the update exists. If you don't...

    • by Nanoda (591299)

      And I built 1 system with an OCZ Petrol and it vaporized the partitions 6 months later, so that's 100%. I think luck had more to do with success than anything.

      I actually _was_ surprised to get a replacement Vertex 4 fairly quickly, which reminds me I should open it and flash it while the firmwares are still easy to get.

    • by Anonymous Coward on Wednesday November 27, 2013 @08:30PM (#45544671)

      I must have gotten some of the messed up drives you were supposed to. I bought 3 OCZ SSDs. All three different sizes, each purchased a few weeks apart. Within a year, and fairly close in time, all three died. Died as in DEAD, with no warning or indications of a problem. Not recognized by BIOS, not flashable, one smelled like burnt electronics, DEAD. OCZ happily replaced all of them. But I figured...this is either an unlikely coincidence or their drives suck. Rather than figure out the answer to that, I bought Crucial and Intel SSDs and all have been running for more than twice as long as the OCZ SSDs with no issues.

    • Re: (Score:2, Interesting)

      by Anonymous Coward
      How many studies do you need to do to prove that gunshots to the head are often fatal?
      • How many studies do you need to do to prove that gunshots to the head are often fatal?

        Just keep insisting on higher standards of statistical rigor until you run out of test subjects who you dislike. Simple enough.

    • by ArbitraryName (3391191) on Wednesday November 27, 2013 @09:19PM (#45545105)
      The study [behardware.com] you are talking about was based on returns from between six months and one year after purchase. It does not cover DOA parts. Your theory is mistaken.
    • by cyberjock1980 (1131059) on Wednesday November 27, 2013 @09:34PM (#45545199)

      I disagree. I've had several friends(at least 4 off the top of my head) that have bought OCZs. None of them lasted 6 months without having to do an RMA. One friend had 3 RMAs in about 9 months. Despite having 3 months left on his warranty he went with Intel(because of my recommendation) because it wasn't worth his time to continually have to restore from backup to a temporary drive while he does the RMA.

      Even in forums I hear people talk about failed OCZ drives regularly. Sure, there's the occasional Samsung and Intel in there. But OCZ sure is mentioned FAR more frequently than the other brands. I'm not convinced that their market share is 90% to offset the number of users that complain about failed disks.

      Personally, I don't care if they used 1-million write cycle flash memory instead of Kingston's 3000 cycle memory. If every drive I've had second hand experience with has to be RMAd in less than 6 months something is horribly wrong and I'd be avoiding that product or brand. There's alot more to a drive than just the number of write cycles. Poorly written SSD firmware could easily make a drive with a very long lifespan be abnormally short due to write amplification. So feel free to keep talking numbers, cause the comparision of write cycles is only a very small part of what makes an SSD reliable(or not).

      In my opinion OCZ has undoubtedly made some bad models. Are they all bad? Probably not. But, it doesn't take much to earn a reputation for being crappy. And once you've earned that reputation it's going to take some serious convincing to get people to spend money on your product again. In my case, they'd have to give me a drive for free to prove that they really are just as reliable as the 3 Intel drives I've had in my 3 main machines that haven't failed in 3 years+ of use.

    • That was because the morons at OCZ released them with beta level firmware that made the first batch of 3 and 4 series drives not be recognized 100% of the time by many BIOSes.

      A few years ago when SSDs were brand new, the constant firmware updating required of these drives was common enough that I remember it.

      It is why I paid a premium for my first SSD, an Intel X25-G2 160GB drive that was $550 at the time (ouch, those were the days).

      Still works perfectly, in a daily use machine, with 97% life left. It will be thrown out from being too small long before it fails.

      While all SSD companies have had their teething problems, OCZ has had more of them, and that rep sticks around,

  • by msobkow (48369) on Wednesday November 27, 2013 @08:14PM (#45544461) Homepage Journal

    Just wondering if it's the same company. Their memory sticks work fine, but that's a minimally profitable market with a glut of providers nowadays.

  • How many? (Score:5, Informative)

    by yoshi_mon (172895) on Wednesday November 27, 2013 @08:38PM (#45544773)

    I use Intel SSDs, period. I'm not a fan of Intel at all and really want AMD to succeed such that we have some compititon in the marketplace. But when it comes to SSDs Intel holds the best non-failure rate that I've found.

    I've paid more but on my own personal rigs as well as every client's, I've not had any failure. And they are fast too. I mean duh, they are SSDs!

    But whenever I saw OCZ I saw marketing. I mean I guess they had some good drives using reliable chips and good controllers but from what I saw it was all about the marketing. Which leads me to my post's question. How many engineers did they really have at that company that worked on things vs the amount of MBA marketeers.

    In short I never saw OCZ as a serious company. They were not a Corsair or some other startup that had real desires to make good hardware. Rather they had a lot of marketing push and very little else. The level of return on their SSDs was super high and once I saw that it told me all I needed to know about them. Anyone can make some RAM and slap on some crafted aluminum heatsink onto it. Not everyone can make a SSD.

  • Had an OCZ power supply start failing with random computer crashes due to +12V bus causing dips due to load and 3 out of 4 purchased SSD OCZ Vertex 1 and Agility 1 drives failed with bad sectors and unreadable data.

    I still have one of their still shrink wrapped and unpacked OCZ Vertex 1 40GB drives that nobody wanted to buy on eBay twice it was listed that I don't dare curse anyone with so it just sits in my closet. Will have to take it out of it's misery one day and shoot it or something but I certainly w

    • by drinkypoo (153816)

      If you don't want to play with bcache, dm-cache, or EnhanceIO on that SSD, then sell it to me at the bare minimum price and I will do it :)

    • by citizenr (871508)

      I still have one of their still shrink wrapped and unpacked OCZ Vertex 1 40GB drives that nobody wanted to buy on eBay twice it was listed

      No, you simply didnt want to sell it at correct price and decided to keep it in spite of everyone, in effect getting nothing instead of real market value.

  • I knew it! (Score:5, Interesting)

    by TheRealQuestor (1750940) on Wednesday November 27, 2013 @08:38PM (#45544783)
    Thank GOD a couple weeks ago I RMA'd the 3rd drive that had failed in less than year. All 3 were Vertex 3 120 Gig. So at least now I have 1 that should be good for another 6 months. The support really was good with no questions asked really on all 3 drives. But what does suck is I bought 3 of them and ALL 3 DIED. I knew after the 1st one died within 60 days I was going to have issues. Over the years I had issues with Ram compatibility and I just knew the drives were going to be iffy. But they are so damn fast and the price was decent [1st one was 300 bucks, 2nd one was 220 [bought about 3 months later] and lastly the 3rd drive was just over 150 bucks] Now they sell for like 80 bucks. After the 3rd one died about 4 months ago or that I was never going to buy an OCZ drive again. I finally broke down and got an RMA after my #2 drive that was replaced about 6 months ago started tossing errors that I had better RMA the drive. Glad I did.
  • ...their business model wasn't that solid, after all.
    • by Dogtanian (588974)

      ...their business model wasn't that solid, after all.

      Some dark glasses and a "Yeeeeeaaaaaaaah" as requested, sir.

  • Based on reviews, my best guess is that you want to buy SSDs from manufacturers that own wafer fabs, because they have control over manufacturing, and their reputation for chip fabrication would suffer if they put out poor-quality SSDs. I'm thinking of Micron/Crucial, Intel [marketwatch.com], Samsung [eetimes.com], Toshiba, Sandisk [eetimes.com], among others.

    Is this true, or are there more important factors to consider when choosing an SSD brand/model?

  • The amount the investing defaultee can expect to recover in a bankruptcy fire sale is larger than any expectations of return from your company's continued existence.
  • The Pre-OCZ designs were very solid power supplies. Would be a shame for that company to end as a result of OCZ's incompetence.

  • OCZ's notoriously unreliable drives.

    I have an OCZ RevoDrive, bought early 2011, and it works like a charm. The only problems I have with it is when installing a Linux distribution from scratch, but after figuring it out once it works very well.

    Maybe I'm one of the lucky few who haven't had a problem with reliability?

  • OCZ is/was a horribly managed company, but IMO one of their other core problems is/was that they arn't a flash memory (NAND) manufacturer... Difficult to compete on price when their major SSD competitors (Intel, Samsung, Crucial/Micron, SanDisk) all have their own fabs...

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