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HP's new Project Moonshot runs on Intel's Atom -- for now

Hewlett-Packard's bet to be a server leader revolves around hyperscale servers, targeted workloads, power savings, and better density. At stake is HP's reputation as an innovator.

A Moonshot server HP

Hewlett-Packard today launched its Moonshot server line with an Intel-based Atom system -- and more chipsets planned in the future. The promise: HP will create Moonshot hyperscale, software-defined servers for custom workloads.

The bet for HP is that it can launch new Moonshot systems at three times the product cycle of traditional servers. For HP, Moonshot represents the company's ability to innovate, remain a server leader, and keep up with cloud customers, which are increasingly building their own gear.

HP CEO Meg Whitman started today's Webcast by talking "brontobytes of information" and by arguing that the Web on its current path isn't sustainable. "The data center space needed will be 200 football fields" to meet demand, and power plants will have to be built, she said.

The case for Project Moonshot, a multi-year effort, is that these systems will cut space and power in the data center. "It's the foundation for the next 20 billion devices," said Whitman.

Overall, HP is pitching a "library" of Moonshot servers and an architecture that's designed for developments like the Internet of things and machine-to-machine applications. Initial reference customers include Savvis, a data center hosting and cloud company, and Purdue University.

HP executives likened Moonshot systems to the move from Unix to x86 servers and the innovation created from the use of blade systems.

Dave Donatelli, general manager of HP's enterprise group, said HP has had more than 50 beta customers for its first-generation Moonshot system. The second gen of Moonshot will be geared to creating a software defined server. Donatelli quipped that the industry will look back at the Moonshot launch 10 years from now and note the event as a marker where the server industry changed.

According to HP, the first Moonshot system is available today in the U.S. and is focused on cloud workloads. The system is powered by Intel's Atom processor. More systems will have multiple partners and target verticals ranging from genomics to cloud to video to analytics, telecom and gaming. A global and channel rollout begins next month.

Chip partners also include Advanced Micro Devices, Applied Micro, Calxeda, and Texas Instruments.

Donatelli also plugged an ecosystem of software developers who will optimize applications for Moonshot hyperscale servers. Donatelli argued that enterprises and cloud companies won't be able to simply add more servers over and over. Power and space will eventually run out.

The big question for HP is how long the Moonshot architecture will take to proliferate. Blade servers didn't take off immediately. Today, Moonshot is for large installations, but over time HP expects the architecture to broaden to other use cases at smaller companies. The reality is that few enterprises would qualify for a hyperscale server treatment. As HP rolls out systems for workloads such as analytics, genomics and financial services that equation will change.

Moonshot's importance to HP
Aside from the obvious potential boost to HP's reputation as an innovator, Moonshot servers also have to pick up the slack for other businesses. According to Barclays analyst Ben Reitzes, Moonshot servers are needed to boost HP's server revenue, which will be more critical should PC sales drop off over time. The problem for HP is that cloud players are using Quanta and Wistron to make their own servers over branded systems. Reitzes noted:

Industry Standard servers represent 43% of total ESSN revenue, an area where HP remains the market share leader but has seen its share slip the last few quarters. We believe growth is being held back by share losses to "self-made" servers for the Cloud players and concerns around HP's future. We are increasingly seeing Cloud players use ODM partners like Quanta and Wistron to make their own servers vs. using products from HP, IBM and Dell. Quanta's servers are in competition with HP's Gemini platform released last June. According to IDC, HP's shipments last quarter were -6% y/y (vs industry growth of -4% y/y) and HP's share was down to 32.0% from 32.6% last year. We believe HP must have a strong x86 server business to drive sales of storage and software. It may also be increasingly hard to sustain a leadership position in servers if HP loses ground in corporate PCs.

Reitzes last point is worth noting. HP needs servers to do well so it can sell more gear elsewhere.

HP is betting that Moonshot servers can represent 15 percent of the market by 2015.

This story originally posted as "HP launches Project Moonshot, powered with Intel's Atom at first" on ZDNet.