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But that hasn’t stopped companies from trying. A new generation of drives is getting us closer by improving the performance, and more important, using more advanced NAND flash memory to cut costs. In addition, Windows 7, which has now been released to manufacturing, includes features that should enhance the performance of SSDs.

Most reviewers agree that Intel’s SSDs, the X25-M and X18-M, have come closest to delivering on the performance claims (not counting SSDs designed for servers from companies such as STEC and Fusio-io). This week, Intel announced its second-generation consumer SSDs, and several sites have already posted reviews with test results.

Like its predecessor, the X25-M G2 is a 2.5-inch drive available in 80- and 160GB capacities. Intel will release the 1.8-inch version, the Intel X18-M G2, later in the third quarter. The primary advantage of the new drive is that it uses the most advanced 34nm MLC NAND chips, rather than the 50nm MLC found in the first-generation drives. (MLC, or multi-level cell, NAND has two bits per cell, which doubles the storage density but also presents some performance and reliability challenges that require sophisticated controllers. Nearly all consumer SSDs use this type of NAND.) The 34nm process packs more bits on a chip, which translates to less-expensive SSDs. The old X25-M used twenty individual 8GB packages for 160GB total; the new X25-M G2 uses ten 16GB devices.

The new X25-M G2 80GB and 160GB will cost $225 and $440, respectively, in quantities of 1,000, and obviously a bit more at retail. Intel says that is 60 percent less than the original version at the same capacity, but this is a bit misleading since they are comparing prices at introduction. You can now pick up the original X25-M for $314 (80GB) or $599 (160GB). The new drives are still a long way from the industry’s $1 per GB goal, never mind laptop hard drives, which are more like $0.37 per GB for 160GB (larger-capacity drives are even cheaper bit-for-bit). There were rumors that Intel would offer a 320GB version–which it could easily do by putting 10 NAND packages on each side of the circuit board as in the old design–but it didn’t happen, most likely because the cost is simply too high. Still SSD prices have been coming down fast, thanks to a NAND industry that cuts manufacturing costs by roughly 40 percent each year.