Ever since CES in January I have been anticipating what I think is going to be the product of the year. After some delays to make sure the software was ready for release, the folks at HP have released the MediaSmart Home Server for resale at most major online sites with delivery scheduled to start later this month.

The wait will be well worth it, as the 500GB model is going to retail for $599.00 and the 1TB model will retail for $749. Each model comes with 4 drive bays and dependent on how you order it will depend on how many free drive bays there will be.

HP has added some cool features to their offering that will sit on top of the Windows Home Server operating system that will make the HP offering even more compelling.

The first is called “HP Photo Webshare” with an HP specific software add-on that comes with the MediaSmart Home Server. You will be able to share your photos from your MediaSmart Home server with relatives and friends. Whoever you give access to those pictures will be able to download and or order pictures online through Snapfish. A even more cool feature is that friends will be able to add pictures to your collection as well.

This will be the first time you will not need to upload your pictures to Flickr. All of your photos are now available via your Internet connection and your family can enjoy your pictures as you update them.

When I asked how ISPs are going to cope with people running a home server on their Internet connection, the HP folks believe that because the usage will be limited to family and friends there should be no issue with ISPs.

If your ISP blocks incoming Port 80 though, this and other features may be in danger of not working. In all likelihood those on Comcast and other services that have strict policies against running servers on their Internet connections will have a issue that Microsoft and HP will have to work through with the ISPs.

The second add service is Windows Media Connect where you will be able to have one instance of your music versus on multiple machines. That media would be available to all network attached devices like an XBox.

A exceptional cool add on is Server for iTunes which will allow the Windows Media Connect to integrate with iTunes. iTunes will recognize the media as a new device and the playlist etc will be available. Thus, all of your computers with iTunes on it will be able to access through the Media Smart Home Server the Server for iTunes interface.

The small form factor and stylish design will only require a power plug and a hard-wired connection to your home network. Each PC then will need to run the client software for the automated backups and rebuild capability that the Windows Home Server brings to the table.

HP has not locked the software down, thus any third party applications that are brought to market will be able to be installed and run on the operating system.