Hardware and software deal by firms

A three-year US$250 million deal to develop hardware and software products has been announced by Hewlett-Packard and Microsoft.

Products will be focused on management and virtualisation solutions for data centres, prepackaged solutions for data warehousing technology and the Windows Azure platform.

The companies aim to benefit from the rebound in information technology spending by businesses and in the light of cloud computing emerging as the most sought-after technology.

Microsoft will use hardware technology developed by HP in data centres which will run on its Windows Azure cloud-based operating system. HP will develop data centres which to be sold pre-loaded with the Azure Cloud infrastructure.

Industry experts predict that, taking into account the present demand for cloud technology, businesses may spend around $95 billion for acquiring cloud computing technology by 2011.

"This is all about integrating technology and making things as close to 'plug and play' as we can," said HP CEO Mark Hurd.

Microsoft CEO Steve Ballmer told analysts: "The cloud is the driving force behind this deal."

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