IBM GXP fiasco secrets revealed

— 12:58 PM on February 16, 2004

The possibility of serious reliability problems with certain of IBM's GXP-series hard drives has been well documented. High failure rates may have forced IBM's decision to sell its hard drive business to Hitachi, and anecdotal evidence has been overwhelming, spawning a massive thread that will not die here at TR, as over a thousand posts have rolled in over time detailing users' experiences with drive failures, failures of replacement drives, and struggles to get IBM to honor its warranties. The fiasco led to the filing of a class-action lawsuit against IBM on behalf of GXP failure victims. However, IBM has consistently denied unusually high failure rates on its GXP drives.

Now, the law firm behind the suit, Sheller Ludwig & Badey, has updated its news page about the case (thanks Lo Yuk Fai) with a PDF version of a bombshell report from the Watchdog section of Maximum PC magazine's February issue. (Reprinted without permission?) The report is based on IBM e-mails and documents made available recently by a California court in connection with the class-action suit. The Maximum PC folks have dug up some sensational info in these documents, including internal IBM discussions revealing failure rates 10 times as high as competing products from other manufacturers, an apparent determination to address the problem through marketing denials rather than manufacturing changes, and a decision to sell a batch of faulty drives into distribution (and thus to consumers) after its rejection by a larger customer due to high failure rates. These practices seem to have raised significant concern inside IBM, based on excerpts from internal communications. A sample: "We have woven a story based upon half truths and misinformation that now places IBM in a position that is almost untenable."

In short, this is one case where the anecdotal evidence, which is all we had at the time we first reported on this story, proved to be pointing us in the right direction. IBM was quite apparently engaging in a pattern of deception and knowingly shipping faulty products to customers while hiding behind rhetoric about standard industry failure rates and the like. Obviously, IBM's decision to bail out of the hard drive business was an indicator that GXP failures were a serious problem. Now, thanks to the class-action suit, we seem to be learning the truth. Let's hope the court sees fit to punish IBM and reward consumers appropriately.

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