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Dell has crunched its numbers and says there isn't a problem with solid-state drives.

The Round Rock, Texas-based company says that the reliability rates for those notebooks are equal to or better than for notebooks with hard drives and that the return rates are "an order of magnitude lower" than reported in a recent analyst report from Avian Securities. (See more on Dell's full statement here.) We wrote a story on Avian's report.

A Dell Latitude with a flash drive.

(Credit: Michael Kanellos/CNET Networks)

Avian earlier this week said the return rates for notebooks with solid-state drives has been around 20 percent to 30 percent. A Dell spokeswoman says that's just not so: the return rate actually is around 3 percent. Dell typically doesn't talk publicly about return rates with this kind of specificity (and at the time of the original article, Dell had said it doesn't generally comment on the issue), but the report and the coverage that surrounded it prompted the company to put some more light on the issue.

So in short, Dell says, solid-state drives are doing as expected for a new technology. Score a big one for a manufacturer over Wall Street.

So how did Avian get the number wrong? Managing Partner Avi Cohen said that Avian might have been getting early data on returns, and not the complete data on sales. He says he can't and won't challenge Dell's data. He even saluted Dell for being an early leader in this category.

Despite the discrepancies between Avian's report and Dell's numbers, Cohen added that there is another issue: customer satisfaction. Although the return rate is a lot lower than he expected, Cohen claimed that there is a sense that customers are somewhat disappointed with the performance gains, considering the high price of notebooks with these drives. Putting a 64GB flash drive in a notebook adds $874 to the price. (But, hey, earlier in the week it was $899.)

"Anecdotally, the returns have been high and the expectations have been low," Cohen said.

Performance, or at least lower-than-expected performance, is an issue that the flash industry will likely have to contend with. The first generation of flash drives could not run particular applications--specifically Microsoft Outlook--as well as notebooks with regular drives, Dell admitted. The probem was ameliorated in February, the company said, when a new generation of flash drives with a better interface went on sale.

But what do you get for $874? Boot-up time is a bit quicker, and some applications come up quicker, but the differences can be measured in seconds. I tested one and liked the quicker boot-up, but not for that much money. The best thing about the drive was that the computer made less noise. Jim Handy, an analyst at Objective Analysis, has said he's heard anecdotally that buyers or testers were a little underwhelmed. Again, it's unscientific, and this isn't meant to detract from Dell's data, but that perception is out there.

Don't forget, the first customers for flash drives were the military and they bought them because they have to put notebooks in harsh, unpredictable environments. (MSystems out of Israel was an early leader in the field.) Most corporate users never experience that benefit.

Cohen also said that it will also take time for manufacturers to come out the cheaper flash drives with flash that holds multiple bits per cell.

The flash industry, of course, would like to see flash notebooks take off because they are suffering through severe price declines. "The semiconductor business has seen a significant decrease in operating income due to a larger than anticipated declines in sales prices of NAND flash memories," Toshiba said Wednesday in revising its current sales projections downward.

Like a lot of people, Cohen says flash-based notebooks will be big, but not just yet. The price has to come down and the technical glitches have to be ironed out.

Solid-state drives are still going to be somewhat hard to find and expensive in 2008, but mass production, cheaper flash, and tech advances will start to change that in 2009 and 2010.

Micron Technology, the Boise, Idaho-based maker of DRAM and flash memory, this week unveiled plans to come out with solid-state drives. The drives function like regular hard drives. But instead of storing data on spinning disks, solid-state drives store it on NAND memory chips--the kind found in cameras and MP3 players.

Micron will start mass-producing solid-state drives in the first quarter of 2008. The first drives will hold either 32GB or 64GB of memory. While that's less than half the capacity of the average notebook drive today, it's actually more storage than most business users need, said Dean Klein, vice president of memory system development at Micron. Plus, solid-state notebooks can come out of deep sleep or launch applications far more rapidly.

"60GB to 80GB is the sweet spot for the notebook market," he said.

Micron didn't talk pricing, but the drives will likely cost a few hundred dollars, a stumbling block. For example, swapping out a 160GB standard hard drive for a 64GB solid-state drive (from Samsung) on a Dell XPS 1330 notebook costs an additional $950. Considering that the notebook with the 160GB drive already costs $1,599, the solid-state drives aren't exactly economical.

Nonetheless, the magic of Moore's Law and the ability of memory makers to take it on the chin are going to make these drives more affordable. The first thing that will happen is that toward the end of 2008, solid-state drive makers will start to incorporate multilevel cell flash chips in the drives, Klein said. Manufacturers currently use single-level cell flash.

Multilevel cell chips hold two (and soon four) bits of data per cell. The chips aren't as reliable as single-level cell memory, but the error rates are small enough to make these types of drives more than adequate for the notebook market, he added.

In addition, multilevel cell chips will enable drive makers to increase the capacity of their drives, driving down the price. At equal capacities, multilevel cell chips could cut the price of making a drive by roughly 40 percent, estimated Frankie Roohparvar, vice president of NAND development at Micron.

Meanwhile, the world is swimming in NAND flash, leading to drastic price declines. NAND prices are set to drop 57 percent this year and 52 percent next year, said Joseph Unsworth, an analyst at Gartner.

Put those two factors together, and it could be possible to come out with a 64GB solid-state drive for close to $300 toward the end of 2008, Unsworth speculated. That's still high. He estimates that only 8 million solid-state drives will get shipped in all of '08.

But after that, the industry should begin to be able to show the benefits of these kinds of drives, the Micron executives predict. Think about it. Even if price declines begin to slow, 64GB drives will likely move toward the $200 range by late 2009 and then drop to sub-$100 about 18 months after that. Hard-drive makers will continue to increase the density of their products at the same time, of course, but competition between the two technologies will become tighter.

It happened in MP3 players, after all. Most upscale players came with 1.8-inch drives. The industry, however, at one point abruptly switched to flash.

Unsworth said the flash makers are going to have to tout the supposed benefits of having a flash drive with less capacity than a spinning disk (better battery life, can withstand a drop from a table better, you may not need all that storage, etc.).

He added that notebook makers will have to cooperate by making smaller laptops that showcase the features of flash. Flash takes up less space and, because it doesn't radiate as much heat, you can eliminate a fan. Currently, the notebooks that contain flash are basically the same size as the hard-drive models.

"With MP3 players, it was easy. You just turn it sideways and quote the battery life," Unsworth said.

USB Flash drives are great. Securing them, however, is not so great. They are easily lost and the more you use one, the more likely it will contain files you consider sensitive. Corsair recently came out with a product that takes an entirely new approach to securing flash drives.

Seeing as this is a Defensive Computing blog, it goes without saying that my personal flash drives are secure. I use a free, open-source program called TrueCrypt. There are however, three problems with this approach:

1. The hassle of installing TrueCrypt and learning how to use it. There is a portable version of it, which I use, but TrueCrypt is a large program with many features (the manual is more than 100 pages) and may be just too much for some people.
2. TrueCrypt only works if you are logged on to Windows as an administrative class user.
3. There is no Mac version (there is a Linux version).

My first approach to security was worse. I bought secure flash drives, models that came with their own security software preinstalled. The secure models cost more than their insecure siblings and the software from each vendor worked differently. At least TrueCrypt gave me a personal standard.

The new Corsair Flash Padlock replaces software with buttons. The side of the device has five buttons with numbers on them, and you press the buttons to chose a password initially and then to enter it later.

I have not used a Flash Padlock, but Scot Finnie wrote a review just a few days ago in his aptly named newsletter, Scot's Newsletter. There can be a huge gap between a good idea and good product. According to Scot, the Flash Padlock is a good product.

For one thing, it's designed to be locked and unlocked without any involvement from a computer. And there are lights that clearly indicate whether it is locked or not. Perhaps most importantly, Scot says "The user interface for the Flash Padlock is very well thought out." If you ever carry sensitive files on a flash drive, read Scot's review.

On the other hand, if you can live with the restrictions of TrueCrypt, then see this getting started cheat sheet that Gina Trapani did in June of last year. Geek to Live: Encrypt your data

If we could only settle on a name for these thingies.

Update: October 3, 2007. Scot wrote a follow-up to his review of the Corsair Flash Padlock drive which notes that the case can be unscrewed to provide access to the un-encrypted flash ram, which sort of defeats the high security. In addition he notes that the encryption software on the Lexar JumpDrive supports Macs despite the fact that the documentation doesn't say so. Finally, he mentions the IronKey flash drive which is very secure and very expensive.

SAN FRANCISCO--Intel will begin building flash-memory drives into servers in 2008, starting with 32GB models that the company promises will boost system performance.

Flash drives can perform 10 to 50 times as many input-output transactions per second as conventional magnetic hard drives, said Pat Gelsinger, general manager of Intel's Digital Enterprise Group, in a speech at Intel Developer Forum here. In addition, they consume 4.5 times less power and write data at twice the speed.

Of course, the flash-drive capacities are much smaller. "The cost per bit is clearly going to be higher," Gelsinger said in a meeting with reporters. But some customers are bound much more by performance, he said, often running lots of hard drives in parallel but filling them only to 10 or 20 percent capacity.

Intel will offer samples of the technology this year and sell production models in 2008, Gelsinger added in an interview.

Intel will start with 32GB models, using NAND flash memory. "We'll have nice progression as we go to 64GB and 128GB over time," he said.

Samsung announced this week that it has begun producing a 64GB flash drive for notebook computers.

Although 32GB flash drives have been on the market for several months, most users need more storage, especially in Vista-based notebooks. I think the new 64GB drives will find a much larger market.

Samsung didn't announce a price for the new drive, but 32GB drives have been selling for around $500 as an upgrade for a few notebook models from Dell and other OEMs. The new drives will probably decline to that price over the next several months.

Meanwhile, of course, conventional hard disks continue to expand in capacity. I just ordered a 250GB hard disk for my MacBook Pro; it was only $279 including an external drive enclosure I can use with my old HD. (I'll report on the results when I install it.) An 80GB notebook hard disk is now a sub-$60 item.

So why go with a flash drive if it's seven to ten times as expensive for the same capacity?

Two reasons may make up the difference: power and reliability. A flash drive will give significantly better battery life; the smaller and more sophisticated the notebook, the greater the improvement. A flash drive will also survive accidents that would kill a hard disk.

But I reject the conventional notion that a customer should have to choose between a flash drive and a hard disk. I'd like to see notebook computers with room for one of each. Not just the hybrid hard disks now being offered by Samsung (which Microsoft refers to as ReadyDrive technology) or Microsoft's related ReadyBoost technology, where a flash drive acts as a cache for a hard disk.

Both approaches are good ideas, getting significant benefits from small amounts of flash memory-- a gigabyte or less-- but I'd like to see notebooks where a large flash drive is made available as an independent logical drive on the system. This way, files can be distributed according to their access characteristics. Files that see a lot of random reads-- the OS, applications, email data files, the virtual-memory swap file, etc.-- can be put on the flash drive. The hard disk would only need to spin up to transfer large media files, make backups of modified files from the flash drive, and other accesses that involve long sequential reads and writes.

This approach isn't practical with just a gig or two of flash, but with 32GB or 64GB, it starts making good sense. Within a few years, that much flash will be fairly affordable, especially for high-end notebooks. It'll also be smaller, allowing OEMs to tuck it into any open area inside the machine.

The combination will provide the best of both flash and rotating storage-- high capacity, low power, and high reliability. There's a cost factor to consider, but premium notebooks sell very well; there are many customers who will pay for such tangible benefits.

I know I would!

(Credit: The White Stripes)

I doubt it will replace the CD anytime soon, but some record labels are experimenting with distributing music on portable USB flash drives. The latest in this occasional trend is The White Stripes, whose Icky Thump album is available in both traditional CD form as well as in a limited edition USB thumb drive format.

Now, the flash drive version sells for $57, well more than the $15 price tag of the CD. That means that only die-hard fans will likely buy the drive versions, which depict the band's Jack White and Meg White as Russian dolls. (Those who need both Jack and Meg will have to shell out $99.)

There have been other releases, such as the recent 30th anniversary Bob Marley Exodus album. The Barenaked Ladies released a couple of albums in this format a couple of years back.

While flash drives have come down in price, simply releasing the same album on a flash drive is likely to be more a novelty than anything else. That said, the portable drives do have some appeal for other uses, such as a home for a take-home version of a concert, something many acts have started offering.

Nine Inch Nails also used the drives as part of an interactive game. That seems to be a step in the right direction. In an age of easy piracy, it makes sense for bands to use technology to connect with their fans as well.

And, while it's unlikely to do much to curb piracy, if one of the White Stripes is sticking out of your USB drive, you might think twice about pirating to get their next album.

Earlier today, I appeared on WNYC's Soundcheck to talk about the topic. You can find the audio clip here.