The Livermore, Calif., company on Tuesday claimed a breakthrough in using the material to fabricate light-emitting diodes, the new-wave components that are finding a place in many lighting applications because of their superior energy-efficiency and longevity. A key barrier to their wider use is high cost–$40 price tags aren’t uncommon for 60-watt equivalent bulbs–and that’s where silicon could come in.

Most LEDs are now fabricated on substrates of relatively costly materials such as sapphire or silicon carbide. Many companies are putting most of their efforts in trying to use larger substrates of the same materials to drive down costs, says Bill Watkins, Bridgelux’s CEO.

A more radical approach is to move to silicon, the foundation of computer chips. Besides the cost advantage of the material, the approach could theoretically make use of the many older semiconductor factories that are inexpensive to operate.

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“I think it’s unfair not to respect a commodity,” Watkins told Newsweek in 2007. “There’s a tremendous amount of technology in this commodity.”

Yet for the most part, investors have given the hard-drive business, with its razor-thin profit margins, short shrift. A valuation debate, plus a nagging fear about the potential obsolescence of hard disks, may have been the two biggest factors in Seagate’s failure to reach a deal to go private.

Most analysts, however, believe that the deal collapsed purely over price.

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A surprising turn of events. Because as recently as Friday, it seemed very much business as usual for Watkins, who had the uniquely unpleasant task of announcing a forthcoming round of layoffs while at the Consumer Electronics Show last week. “We are going to announce another round, and we think we’ll do it in January,” he told Bloomberg on Jan. 9. “There will be restructuring, and there will be some layoffs.”

And, indeed, it appears there have been. Not only has there been an abrupt change in leadership, but according to a new filing with the SEC, Seagate plans to sack about 10 percent of its U.S. workforce as part of a restructuring plan that “will impact a broad range of departments, including research and development.” It is, of course, “being done in response to the current economic environment.”

Watkins made his remarks in an interview this afternoon with Tech Trader Daily following the company’s announcement of third-quarter results. While the September quarter numbers weren’t bad, the December outlook fell short of Street expectations, and the stock is trading lower after hours.

Watkins says that “bizarre as it sounds,” he feels better about Seagate’s business now then he did in June, noting that the company has made improvements in inventory turns, trimmed operating expenses and sped up the introduction of some new products. He says that business in October “looks pretty good, to be honest,” but that no one knows how things will go for the rest of the December quarter. Watkins says the PC manufacturers are like “deer in the headlights,” after failing to see a back-to-school demand pickup, and aren’t sure what happens in terms of fourth-quarter sales.

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Yesterday, Seagate (STX) filed a lawsuit in federal court accusing STEC Inc. (STEC), an early SSD maker, of patent infringement. In the suit, Seagate argues that STEC’s solid-state drive products violate four Seagate patents covering the ways those products communicate with a computer. The company requested an injunction and unspecified damages, which it asks be tripled if STEC is found guilty of willful infringement.

“The public perception has been that solid-state will take over the world and run disk makers out of business, but you can’t bring that product to market without licensing disk-drive technology,” said Seagate CEO Bill Watkins. “STEC infringes on a number of Seagate’s patents which are important to the entire industry. We thought they would have to learn how to do storage differently to avoid our patents, but they decided to go ahead and violate them. … We have spent $7 billion over the last 10 years to optimize how our disks work. This is the first lawsuit brought by a hard-disk company against a solid-state company. We are protecting the entire industry.”

That’s an altruistic way of looking at litigation that Watkins suggested in an interview in March was designed to protect Seagate’s own turf. After all, a Seagate victory in the suit could pave the way for cross-licensing agreements, not just with STEC, but with other SSD makers as well.

Some are worried about eBay’s recent financial results and some are not:

It’s good to be pregnant at Google (but maybe not so good to be old), including–no joke–”Expectant Mother Parking” spots:

Seagate CEO Bill Watkins, who is a firecracker, talks about the drive-maker’s sharp earnings:

Tesla Motors’ Martin Eberhard (they love him in Silicon Valley) on the first electrical roadsters: