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Press release:  HP rolls out new servers, data storage gear

Date : 2004-02-10

SAN FRANCISCO, Feb 9 (Reuters) - Hewlett-Packard Co. (NYSE:HPQ - News), the No. 2 worldwide maker of computers, on Monday rolled out new servers using Intel Corp.'s (NasdaqNM:INTC - News) Itanium chips and data-storage products, continuing to square off against its rivals.

Palo Alto, California-based HP announced an entry-level Integrity server, which uses Itanium 2 processors and costs less than $3,000, the company said, as well as other servers. HP also unveiled pay-per-use financing on some of its high-end storage products.

HP, along with rivals International Business Machines Corp. (NYSE:IBM - News) and Sun Microsystems Inc. (NasdaqNM:SUNW - News), is responding to customer demands that they be able to do more with the computing systems they already use, and have flexibility with new systems that they buy.

As the computing industry has moved increasingly to standardized products, rather than proprietary semiconductors and software, HP has embraced Itanium, which it co-developed with Intel (NasdaqNM:INTC - News), the world's largest semiconductor maker.

HP, while embracing Intel, also continues to support its own proprietary chip technologies, such as PA-RISC, MIPS and Alpha, which it inherited when it bought Compaq Computer in May 2002.

Ultimately, however, HP will phase out the propriety chip technologies and settle on Intel's processors to use in its computer servers, which help to make up computer networks.

HP also rolled out what it said was an enhanced line of HP 9000 servers that use the next generation of its PA-RISC-based PA-8800 processors. HP said the new servers give a 50-percent performance boost over PA-8700-based servers with the same number of microprocessors, the primary computing engines of computers and computer servers.

HP, along with Dell (NasdaqNM:DELL - News), IBM and others, already sell servers that use Intel's Xeon processors, which are based on mainstream x86 technology.

"We view industry standards as the right way to go," said Mark Hudson, an HP marketing executive . "We believe there are two: x86 and Itanium."

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