M-Systems

Storage products from flash memory

M-Systems was founded in 1989 by Dov Moran and Aryeh Mergi and was based in Kfar Saba. It developed storage products based on flash memory, that is, memory that can be rewritten and keeps data even after the power is cut. The company worked on turning the component into a storage system that could be built into computers and other devices. Its products included DiskOnChip, for building into computers and devices, Mobile DiskOnChip for cell phones, and DiskOnKey for portable storage. These are different uses of the same family of technologies: storage as part of the device versus a device the user carries and moves between computers.

Milestone: the DiskOnKey

According to the Israel Innovation Authority, development of the portable device began in 1999 and the product was introduced at the end of 2000. It combined flash memory with a USB interface and was called DiskOnKey. In Israel the name became the common word for this whole family of devices, and the Israel Innovation Authority records how they became a global standard for removable storage. The engineering history site ETHW also describes the contribution of Dov Moran and the people of M-Systems to creating the USB drive and replacing the floppy disk for moving data. The achievement is a consumer product that became a common way to move files, alongside the technologies the company developed for other storage uses.

What changed in everyday use

The DiskOnKey made it possible to store files outside the computer and move them to another computer through a USB connection. The Israel Innovation Authority mentions first capacities of 8, 16 and 32 megabytes, as well as falling prices and rising storage capacity as the product spread. Instead of depending on a small floppy disk or on transfer over the network, users could carry data with them for installation, work or backup. Separately from the portable product, the Mobile DiskOnChip line provided storage for phones, and the DiskOnChip line was built into computers. In this way M-Systems developed storage systems for several kinds of customers, not just a USB device.

IPO and acquisition by SanDisk

M-Systems went public on Nasdaq in 1993. In July 2006 SanDisk announced it would acquire it in a stock deal, valued at the time at about $1.55 billion. The acquisition was completed on 19 November 2006, and in SanDisk's reports the deal was valued at about $1.5 billion. M-Systems' business was merged into the buyer, and the company ceased to be an independent public company. The results of the acquired business were included in SanDisk's reports for the last quarter of 2006.

Legacy

The best-known legacy is the portable flash drive, which remained a product category even after the independent company was gone. The Israel Innovation Authority notes the continued growth in capacities and the falling cost of flash memory, along with the DiskOnKey's place in everyday language and use. Aryeh Mergi was among the founders of XtremIO and ActivePath, and later founded Pliops. Dov Moran founded Comigo and heads it. Alongside the company's merger into SanDisk, the founders went on to develop companies and products in their fields of expertise.