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HP’s Moonshot System strengthens its leadership position

Anne Shields

Overview: Hewlett-Packard's 3Q14 earnings and strategies (Part 7 of 14)

(Continued from Part 6)

HP-market leader of the server market

Hewlett-Packard (or HP) (HPQ) has held the title of “x86 server market leader” for the last 16 years, according to the International Data Corporation (or IDC). It has launched Commercial UNIX server, HP 9000 Series 840, first x86 server, and HP SystemPro successfully over the years.

The above chart shows the market share held by players in the server market. The market was worth $57 billion in 2013. HP led the market with a 23% market share. It was followed by Dell. IBM (IBM), Cisco (CSCO), and Oracle (ORCL) are other prominent players in the server space.

Moonshot servers are aggressively priced 

In April 2013, HP launched HP Moonshot System along with Intel (INTC). HP Moonshot servers are built from chips that are used in smartphones, tablets, and other portable devices. This enables it to deliver reduced energy use—by 89%—and a high-density footprint. They’re delivered at a significantly lower cost—by 77%. Since it gets support from 1,800 servers per rack, HP Moonshot servers occupy one-eighth of the space required by traditional servers, according to HP Labs. Physical data center space issues can be resolved by implementing HP Moonshot.

Moonshot servers—claimed to be world’s first software-defined web server—are a result of HP’s server intellectual property (or IP) and ten years of extensive research from HP Labs. HP Labs is its central research arm. It uses processors from a broad ecosystem of HP partners including Advanced Micro Devices, Applied Micro, Calxeda, Intel, and Texas Instruments Inc.

Moonshot servers are designed to address the challenges posed by SMAC

The current data center growth is restricted. HP is restricted according to traditional IT infrastructure. Exponential growth in data and devices is connected to the internet. It’s connected to the internet because of social, mobile, analytics, and cloud (or SMAC) and “big data.” There’s an increasing need for servers that are able to understand the constraints posed by SMAC. Moonshot servers are designed for virtualization and cloud. They’re an IT as a service (IaaS). As a result, they’re able to address these challenges.

In 2013, HP’s CEO Meg Whitman stated that there are approximately ten billion devices connected to the internet. In her words, “HP Moonshot marks the beginning of a new style of IT that will change the infrastructure economics and lay the foundation for the next 20 billion devices.”

HP entered into a joint venture with Foxconn

In April 2014, HP and Foxconn announced a joint venture agreement that’s focused on the creation of a new line of cloud-optimized servers. The new line is aimed at service providers. Foxconn has a high-volume design. It has extensive manufacturing expertise. HP has leading computing services. It’s known for its server leadership. The combination of Foxconn and HP is expected to deliver solutions that would be ideal for  performance and cost reduction.

HP also announced a joint venture with Hon Hai Precision Ind. Co. Ltd. to create new line of cloud servers aimed at service providers.

Changed the title to HP’s Moonshot System.

Continue to Part 8

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