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HP and Calxeda have teamed up to build servers based on ARM's low-power design.

Dow Jones Newswires reports that HP has teamed up with semiconductor start-up Calxeda to develop servers based on ultra low-power ARM chips. These servers will be focused on companies who build large data centers and need to lower both their physical footprint and overall energy consumption. These companies include those who deal with cloud computing, the Internet, and those looking to do analysis on their data.

According to sources close to the project, HP and Calxeda will soon unveil a prototype server and plans for a proof-of-concept program as well as more details about partnerships. Sample chips produced by the partnership will likely make an appearance by the end of the year, and then ramp up to a full-fledged volume production by the second half of 2012. These chips will consume about 90-percent less energy, take up around 90-percent less space and have a lower overall cost of ownership compared to Intel's mid-range server processors.

ARM is actually an investor in the Austin, Texas-based Calxeda. According to reports, the first reference design will be based on an ARM Cortex-A9 quad-core SoC. Server builders will be able to design systems as dense as 120 ARM quad-core nodes (480 cores) in a 2U enclosure, with an average consumption of around 5W per node (1.25W per core). The chips may be manufactured at Globalfoundries using 45-nm or 28-nm process technology.

Naturally HP, ARM and Calxeda declined to comment on partnerships that have not been made public. However last week ARM Vice President Michael Inglis said that ARM-based chips will first appear in server machines used to support basic access to websites, and then move up to more powerful systems. "As we move forward into 2014, you'll begin to see systems emerging," he said.

Meanwhile Intel seemingly doesn't take ARM's entry into the server market as an immediate threat. "We don't take any threats to our server business lightly, but there are a number of challenges for the ARM architecture to be successful in the server market," Intel spokesman Bill Calder said. "We believe the best-performing platform will win."

In addition to working with HP, unnamed sources report that Calxeda is also talking with other major server makers, storage vendors and other companies about using its processors in their products. Partnerships are expected to be announced within the next few months. Karl Freund, Calxeda vice president of marketing, said the company is in various stages of discussions with many partners about bringing products to market.