Fujifilm pours $64 million into magnetic tape production as AI storage demand surges

Fujifilm has committed $64 million to bolster its magnetic tape production capabilities, amid a surge in demand driven by artificial intelligence (AI). The Japanese company is expanding its manufacturing capacity at its Kanagawa Factory in Odawara, Japan, over the next three years, from fiscal year 2026 to 2028. The $64 million investment will enable Fujifilm to five-fold its current production output to meet the increasing market demand for magnetic tape storage solutions.

AI and related services are cited as the primary drivers behind the growing demand for magnetic tape storage. The substantial volumes of digital data generated by AI companies for training models and inference workloads require a secure and cost-effective storage option. Magnetic tapes excel in this regard, offering high storage capacity, long-term data preservation, and lower financial investment compared to modern storage solutions like SSDs.

Fujifilm's Kanagawa plant will focus on producing LTO-10 tapes, which follow the LTO Ultrium standard established in the 1990s. These tapes boast a native capacity of 40 terabytes per cartridge, with compression enabling up to 100 terabytes of storage. The transfer rate of 400 megabytes per second is more than sufficient for cold storage workloads.

Fujifilm anticipates the next iteration, LTO-11, will arrive in 2029, delivering 70 terabytes of uncompressed data per tape. Future upgrades could see capacities expand to 120 TB (LTO-12), 210 TB (LTO-13), and even 365 TB (LTO-14) per cartridge.