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According to reports in Nikkei, the electronics company has already stopped production of 1in hard disks, and plans to cease shipments of 1.8in disks by next summer.

Hitachi is apparently planning to focus on the 2.5in and 3.5in drives used in PCs and other larger multimedia devices, a market it still believes there is growth in.

The move follows reports that Hitachi is considering selling a stake in its loss-making hard drive business to US private equity firm, Silverlake. Hitachi's storage business has yet to post a profit since its acquisition from IBM in 2002 for $2 billion.

Similarly, Nikkei reports that Fujitsu is also considering abandoning 1.8in HDD, despite agreements to develop the technology with US firm Cornice. Instead Fujitsu is reportedly looking at sinking its resources into flash drives, increasingly the first choice for manufacturers of portable devices.

Both Hitachi and Fujitsu abandon a market dominated by Toshiba, which according to research firm iSuppli, currently holds a 70% market share.