Fujifilm plans to invest approximately ¥10 billion (about 10 billion yen) at its Kanagawa Factory’s Odawara Site in Japan to increase magnetic tape production capacity by approximately five times. The expansion, scheduled between fiscal 2026 and fiscal 2028, will focus primarily on manufacturing its latest-generation LTO Ultrium 10 data storage tape. The company is responding to growing demand for long-term data archiving as generative AI, cloud services and data center operations increase the volume of information organizations need to retain. The investment is also intended to strengthen supply capacity for customers using magnetic tape for offline storage and ransomware protection.
Fujifilm Expands Magnetic Tape Capacity as AI Storage Demand Grows
The rapid expansion of generative AI is creating a data storage challenge that extends beyond the high-performance systems used to train and run AI models. Enterprises and cloud providers also need to retain growing volumes of training data, business records, model outputs and other digital information over long periods. That is bringing renewed attention to storage technologies designed for archival workloads rather than continuous, high-speed access.
Fujifilm is increasing its investment in one such technology: magnetic tape. The company plans to spend approximately ¥10 billion at its Kanagawa Factory, Odawara Site, to raise production capacity for data storage magnetic tape by around five times. The investment will be carried out from fiscal 2026 through fiscal 2028 and includes expanded manufacturing facilities and additional personnel.
Fujifilm describes the project as its largest investment to date in dedicated LTO tape facilities. Production expansion will focus primarily on its latest-generation FUJIFILM LTO Ultrium 10 product, which launched in 2025.
Why AI Is Renewing Interest in Magnetic Tape
AI infrastructure discussions often focus on GPUs, high-bandwidth memory, solid-state drives and high-performance storage systems. But these technologies serve different purposes from archival storage. Not every dataset needs to remain immediately accessible, and keeping large volumes of information on high-performance storage can be costly.
Magnetic tape occupies a different position in the storage hierarchy. It offers high-capacity storage, comparatively low costs for long-term retention and the ability to keep data offline when cartridges are not mounted in a tape system. That physical separation can help organizations reduce exposure to network-based threats, including ransomware.
The technology is particularly relevant to hyperscale cloud providers, data center operators, research organizations and enterprises managing large archives. AI training and inference can generate substantial amounts of data, while regulatory, operational and business requirements may require organizations to retain information well after its immediate computing value has passed.
Tape is not a replacement for flash storage or hard disk drives. Its principal role is in backup and archival environments where access frequency, retrieval speed and cost have different priorities. Data retrieval generally requires loading a cartridge into a compatible tape drive, making it less suitable for applications that need continuous, low-latency access.
Fujifilm’s investment reflects the view that demand for this storage tier will continue to grow alongside cloud and AI infrastructure.
LTO Ultrium 10 and Fujifilm’s Materials Technology
Fujifilm has worked on magnetic recording technology since the 1950s and entered the data storage tape market with FUJIFILM LTO Ultrium 1 in 2000. The company has since developed magnetic particle and precision coating technologies to increase recording density and capacity.
In 2011, Fujifilm became the first company to commercialize barium ferrite (BaFe) magnetic particles for data storage tape, according to the company. Its latest-generation LTO Ultrium 10 uses proprietary fine hybrid magnetic particles combining technologies based on barium ferrite and strontium ferrite (SrFe).
These materials are part of the effort to improve the magnetic properties and recording performance of tape media. Increasing areal recording density—the amount of data stored within a given physical area—is central to raising cartridge capacity without proportionally increasing its size.
The LTO format is developed through the LTO Program, an industry collaboration involving Hewlett Packard Enterprise, IBM and Quantum. Fujifilm is a media manufacturer within that ecosystem, supplying cartridges designed for compatible LTO tape drives.
Production Expansion Reflects a Supply-Side Shift
The planned fivefold increase is measured by shipment capacity against fiscal 2025, according to Fujifilm. That distinction matters: the announcement describes a substantial expansion in the volume of tape the company expects to be able to supply, not a fivefold increase in the capacity of an individual cartridge.
The investment also comes as tape manufacturers and infrastructure providers prepare for higher-density archival systems. The LTO Program, whose technology provider companies include Hewlett Packard Enterprise, IBM and Quantum, announced 40 TB native-capacity LTO-10 cartridge specifications in November 2025, with up to 100 TB under 2.5:1 compression. Ultrium LTO
Fujifilm’s LTO-10 portfolio includes a 30 TB native-capacity version and a 40 TB version. The latter offers up to 100 TB compressed capacity, according to the company’s product information. These figures depend on compression assumptions; native capacity is the more direct measure of how much uncompressed data a cartridge can hold. Fujifilm [India]+1
Fujifilm’s manufacturing expansion is therefore aimed at increasing the availability of media for a storage format that is evolving in capacity as well as in its role within enterprise infrastructure.
Tape’s Role in Cyber Resilience and Long-Term Storage
Magnetic tape’s offline-storage capability is also part of its appeal. When cartridges are removed from a library or otherwise isolated from connected systems, they can provide an air gap between archived data and network-based attacks. That can reduce the risk of ransomware affecting backup copies, although it does not eliminate the need for access controls, secure handling and recovery testing.
Tape also offers a different cost profile from disk and flash storage, particularly for information that is retained for years but accessed infrequently. Its trade-offs include slower retrieval and the need for compatible drives and tape libraries. Organizations typically use it alongside disk and cloud storage rather than as a universal replacement.
Fujifilm says it holds the largest global share of the magnetic tape market, based on producer share. The new investment is intended to strengthen its ability to supply cloud providers, data center operators and other customers as demand for archival storage increases. Fujifilm [Japan]
The expansion also has a workforce component: Fujifilm plans to add personnel as well as manufacturing equipment at Odawara. That suggests the project is intended to build a larger production structure, not simply improve output through equipment upgrades.
The investment does not guarantee that every customer will see shorter lead times or lower prices, and Fujifilm has not disclosed the expected annual output volume after expansion. But a fivefold increase in shipment capacity would represent a significant change in the company’s ability to supply LTO media.
As AI and cloud workloads continue to expand, the storage challenge will involve more than keeping data immediately available. Organizations will need to decide which information belongs on high-performance systems and which can move to lower-cost archival tiers. Fujifilm’s investment signals that magnetic tape remains part of that infrastructure mix—and that manufacturers are preparing for a larger role for long-term data retention.
Market Landscape
The data storage market is increasingly divided across several tiers:
- Flash storage: Suited to high-performance workloads requiring low latency, including active databases and demanding AI applications.
- Hard disk drives: Used for large volumes of online and nearline storage where capacity and cost are important.
- Magnetic tape: Designed for backup, long-term retention and archival workloads where immediate access is not essential.
AI is increasing demand across these tiers, but its impact on archival storage is particularly relevant. Organizations may need to retain training datasets, model checkpoints, generated content, operational logs and compliance records even after those assets are no longer used frequently.
The LTO ecosystem is also advancing. Its 40 TB native-capacity LTO-10 specifications, with up to 100 TB compressed capacity, show how tape media is evolving to accommodate larger archives. Ultrium LTO
Fujifilm’s investment addresses the supply side of this market. By expanding manufacturing capacity at Odawara, the company aims to support growing demand for higher-capacity tape media while maintaining its position in the LTO supply chain.
Top Insights
- Fujifilm plans to invest approximately ¥10 billion at its Odawara facility between fiscal 2026 and fiscal 2028 to expand magnetic tape production.
- The company expects shipment capacity to increase approximately fivefold compared with fiscal 2025, primarily supporting its LTO Ultrium 10 product range.
- LTO-10 cartridges offer up to 40 TB native capacity and 100 TB compressed capacity in Fujifilm’s 40 TB version.
- Magnetic tape remains relevant for long-term archival storage because it combines high capacity, lower-cost retention and the option of offline isolation.
- The expansion includes additional manufacturing facilities and personnel, making it Fujifilm’s largest investment in dedicated LTO tape facilities to date.
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