Hewlett-Packard on Monday introduced the next generation of its Windows-based home server, which includes nearly four times the memory as the previous version and more storage capacity.

InformationWeek’s John Foley speaks with Carter George, the Vice President of Products for Ocarina Networks. Unlike many storage optimization solutions, Ocarina Networks offers storage optimization that is focused on online storage.

The new HP MediaSmart Server comes in two models, the ex485 and ex487. The only difference in the two is in storage capacity. The ex485 comes with one 750-GB, 7200 RPM SATA hard disk drive and the ex487 with two of the same drives for a total of 1.5 TB. The first generation server, released in late 2007, had a base capacity of 500 GB. Additional hard drives can be added to the latest system for up to 9 TB of storage.

The idea behind the MediaSmart Server, which runs the Microsoft (NSDQ: MSFT) Windows Home Server platform, is to provide a central repository for backing up and accessing digital music, videos, photos, and other files from multiple computers on a home network. The HP server supports Windows PCs and Apple Macs running Leopard using Apple Time Machine software.

Among the new features in the latest product is a photo-sharing tool that includes integration with several online services, including Snapfish, Facebook, Flickr, and Picasa. There’s alsoAmazon (NSDQ: AMZN) S3 integration for online backups.

The system comes standard with 2 GB of DDR2 memory, versus 512 GB in the first generation, and is powered by an Intel (NSDQ: INTC) Celeron 2.0-GHz 64-bit processor. Processors from Advanced Micro Devices (NYSE: AMD) powered the original system.

In addition, there are four USB 2.0 ports, one in the front and three in the back, and one eSATA port for connecting an external hard drive.

The MediaSmart Server is 5.5 inches wide, 9.8 inches high, and 9.2 inches deep. The ex485 costs $599 and the ex487 is $749. The system can be pre-ordered beginning Jan. 5 from Amazon.com, BestBuy.com, Frys.com, and NewEgg.com. The product is scheduled to ship in February.

Reviews of the latest MediaSmart Server are available on enthusiast sites, including We Got Served and MediaServer.net.

Despite software improvements that make home servers easier to use, the products have been embraced mostly by computer enthusiasts and have yet to reach the mainstream consumer market. Microsoft, HP, and other hardware manufacturers are banking that the amount of digital content being created in homes will continue to grow, eventually making central storage devices a standard piece of equipment for many households.