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The world’s largest manufacturer of semiconductor products, Intel Corp. (INTC - Analyst Report), announced its new solid state drive (SSD) DC S3500 Series.

The latest SSD is ideal for cloud computing and data center applications, especially read-intensive applications like web hosting, cloud computing and data center virtualization. The drive is based on latest multi-level cell NAND flash memory as well as custom controller and firmware. The drives use Serial ATA-6Gb/s interface and deliver sequential read speeds of up to 500MB/s and sequential write speeds of up to 450MB/s.

Additionally, the new SSD provides uninterrupted services, including a short period of backup power in the event of a power cut. The drive also uses 256-bit AES encryption for data protection. The SSD is available in 80 gigabyte (GB) to 800GB capacities in both 1.8” and 2.5” form-factors for $115 and $979, respectively. The drive also comes with a 5-year warranty.

Intel believes that the SSD DC S3500 Series is capable of delivering a device with utmost speed, quickly responding systems, energy efficient features, more consistent performance and smaller space requirements.

Cloud computing is a process in which data or software is stored at a remote location but can be easily accessed anywhere anytime via the Internet. This idea has been truly revolutionary and helps firms lower IT costs by cutting down on the need for servers and the required staff to maintain the hardware.

Due to its significant advantages, cloud computing has been quite popular in the recent years and the momentum is expected to continue. Market research firm IDC predicts that worldwide spending on cloud services will reach $44.2 billion this year. Another firm, Gartner predicts that around $677.0 billion would be spent on cloud services from 2013 through 2016. Gartner expects the public cloud services market to jump 18.5% in 2013 to total $131 billion worldwide, up from $111 billion in 2012.

The demand for cloud computing is growing on a regular basis and the huge growth potential has prompted Intel to focus more on cloud computing. The release of these new SSDs would help Intel to be in a better position to increase its share in the cloud computing business.

Intel has a strong market position and remains well positioned in both storage and networking. However, Intel’s main business of making processors for PCs is seeing sagging demanddue to the increasing customer shift toward tablets and hybrids. Therefore it is important for Intel to focus on growth areas like cloud computing.

The company delivered decent first quarter 2013 results. The top-line numbers for the quarter were within the guidance range and slightly better than normal seasonality, while the bottom line missed the Zacks Consensus Estimate by a couple of cents. We believe that growth in data centers, focus on the mobile segment, adoption of new products and new offerings should help Intel get back on growth track.

Intel shares carry a Zacks Rank #3 (Hold). Other stocks that have been performing well and are worth considering include STMicroelectronics NV (STM - Snapshot Report), Magnachip Semiconductor (MX - Snapshot Report), Microchip Technology (MCHP - Analyst Report), all carrying a Zacks Rank #2 (Buy).

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