HP Signs On As First Customer For Intel NetStructure

By Mark Hachman, TechWeb News

Hewlett-Packard became the first company on Thursday to agree to sell Intel's line of NetStructure appliances, beginning in March 2001.

The deal follows Intel's decision to remove itself from the server appliance market, following conflicts with its customers. Intel Corp. executives said the company is in negotiations with other OEMs, but a broad distribution of its products across the industry wasn't likely.

"As we continue to invest and focus on the needs of datacenter customers and service providers and the large enterprise, [the Netstructure line] represented a large offering to meet customer needs," said Frank Harvist, general manager of HP's server appliance group, Palo Alto, Calif. "It just fits very well."

Analyst company IDC, Framingham, Mass., said it expects the server appliance market will expand, to an $11.6 billion market by 2004.

The Intel technologies to be adopted by Hewlett-Packard Co. include Web hosting, e-commerce, management, load-balancing, SSL and XML acceleration products, and VPN appliances. HP will not adopt the NetStructure caching appliance and probably not the networking products, as the lines would overlap HP's own products.

While NetStructure products will complement HP's own Netserver line, they will receive a new, undisclosed brand name, Harvist said.

Intel is in "various levels of negotiations" with several OEMs regarding similar deals, said Paul Abbott, general manager of Intel's Internet management division. Intel will continue to "propose products" to OEMs, who will then have the option of buying them, Abbott said.