Drive makers such as Seagate Technology have been championing a technology called heat-assisted magnetic recording they see providing the next big leap beyond perpendicular recording, today's mainstream technology. HAMR puts a tiny laser light on each drive head to heat a portion of the disk just before a write operation.

Rivals such as Hitachi Global Storage Technologies believe patterned media is a better next step. The approach uses new equipment to etch defined tracks and even bit locations on media.

Ultimately both technologies will be needed to deliver disks that pack 10 terabits or more per square inch. But the question the disk drive industry is weighing in the next twelve months is which comes first.

"I think next year will be pivotal," said Tom Coughlin, president of market watcher Coughlin Associates, Inc. (Atascadero, Calif.). "By the end of 2010 people will have to make decisions about what their first products will be in 2011," he said.

Using perpendicular recording, drive makers are now shipping units that pack 530 Gbits per square inch. Coughlin believes the technology could hit a wall in about two more product generations when products hit about 800 Gbits/square inch.

"Usually you want to introduce a new technology before the old technology runs out of gas," he said.

Drive makers need to keep a pace of increasing areal density about 40 percent a year to match similar declines in cost per Gbit of NAND flash, the rival technology. However, the new techniques require new components, process steps and equipment "and yields will be awful in the beginning," Coughlin said.

Thus while costs per bit should decline, the costs of the drives themselves will be stable or even rise slightly. That is likely to heat up negotiations between driver makers and their OEM customers who like to see steady declines in hard disk prices.