HP impressed investors and was praised for making a smart business move by becoming the first major server player to support ARM, or low power chips.
ARM technology is usually found in smartphones and tablets. However, HP will use them in servers with Redstone.
Redstone is a server that HP will launch soon to employ these low power ARM chips.
“The low power attributes of ARM’s architecture cloud give HP an advantage when selling into environments where power consumption is a critical factor,” said Brian Marshall, an analyst at International Strategy and Investment Group, to TheStreet.com.
Marshall also mapped how he thinks HP’s strategy can use some of the new technology by supporting ARM.
“We think HP is targeting cloud-computing applications in the data center with the Redstone platform,” he added.
Both Google and Apple have recently built massive new data centers in North Carolina that rely on vast server farms.
These ventures provide HP with tremendous opportunities to swoop in and offer the new services based on ARM technology.
Redstone will launch in early 2012 and will use ARM chip technology adapted by Calxeda, a Texas company.
Calxeda is Austin-based and it said that its ARM Cortex-based EverCore processor is a great way for other companies to slash data energy consumption by up to 90 percent.
The Redstone system will employ 2,800 servers in a single data center rack. It will also help HP to increase its profits.
“This development would add around $220 million in incremental operating income to HP in calendar year 2012 and drive our $4 estimate to $4.09,” said Marshall.
HP said it would help companies reduce their amount of cabling and switching drastically.