PALO ALTO, Calif., and TAIPEI, Taiwan HP and Foxconn today announced a joint venture agreement to create a new line of cloud-optimized servers specifically targeting service providers.

According to IDC, service providers will continue to break new ground in search of both performance gains and cost reductions as they expand their cloud architecture implementations. Additionally, the hosting-as-a-service model will continue to transition away from traditional models toward cloud-based delivery mechanisms like infrastructure as a service, spurring hyperscale growth in servers used for hosting (15 to 20 percent CAGR from 2013 to 2018).⁽¹⁾

The changing needs of cloud computing require a new approach to server design that brings together cloud solutions expertise, quick customer response and volume manufacturing. Creating innovative servers and solutions has been a cornerstone of the relationship between Foxconn and HP for several decades and todays announcement further strengthens the partnership. Foxconns ability to deliver superior value throughout the supply chain, together with HPs industry compute leadership and industry-recognized service and support, will deliver new world-class computing platforms by bringing high-density, easy-to-manage, cost-competitive solutions to market.

The new product line will specifically address compute requirements of the worlds largest service providers by delivering low total cost of ownership (TCO), scale, and service and support. The line will complement HPs existing ProLiant server portfolio, including Moonshot.

With the relentless demands for compute capabilities, customers and partners are rapidly moving to a New Style of IT that requires focused, scalable and high-volume system designs, said Meg Whitman, president and chief executive officer, HP. This partnership reflects business model innovation in our server business, where the high-volume design and manufacturing expertise of Foxconn, combined with the compute and service leadership of HP, will enable us to deliver a game-changing offering in infrastructure economics.

Cloud computing is radically changing the entire supply chain for the server market as customers place new demands on the breadth of design capability, value-oriented solutions and large-scale and global manufacturing capabilities, said Terry Gou, founder and chairman, Foxconn. In partnership with HPs server leadership, we are embracing this new opportunity to change the industry, capture growth in this emerging market, and deliver end-to-end value as we expand our global leadership in design and manufacturing.

Pricing and availability

The non-equity joint venture, in the form of a strategic commercial agreement, will take effect on May 1. Details on pricing and availability will be announced at a later date.

About Foxconn

Founded in 1974, Foxconn Technology Group, under the leadership of founder and Chairman Terry Gou, offers the most competitive production manufacturing technology in the World. With forward-looking vision, Foxconn self-created the 3C OEM service business model eCMMS, incorporating vertical integration of mechanical, optical and electronic components, as well as the advantage of one-stop integrated solution. Foxconn Technology Group has in recent years gradually transformed in the direction of technology services, providing customers the most comprehensive solutions. Aside from maximizing value creation for customers, Foxconn Technology Group is also dedicated in enhancing the concept of environmental protection in the manufacturing process and aims to be the trusted partner for customers as well as the model for global enterprises.

⁽¹⁾ IDC, Worldwide Server 2014 Top 10 Predictions: A Time of Transition, February 2014.