HP MediaSmart Server update streams your video to your iPhone

HP’s MediaSmart Server is getting a software upgrade that will allow it to stream video to your iPhone or iPod touch. The server will be able to take your DVDs and transcode them to a format that will play on portable devices like the iPhone and the PSP. There’s one caveat — DVDs must not have copy protection. If your DVDs are copied to your HP MediaSmart Server and they don’t have copy protection, the server will transcode those files for streaming.

The sever will also handle other videos formats such as Dvix, DVR-MS (Windows Media Center recorded files), WMV, and more. Also, original files will also be preserved. The best thing is HP is not charging for this software update. The iPhone and iPod touch app will also be free.

The app is called the “iStream” and lets you stream your videos from your HP MediaSmart Server without syncing up. You will also have access to your music and pictures.

The HP MediaSmart Server is available now for $599 (with 750GB of hard drive space) and for $749 (with 1.5TB of space).