The company claimed ACT would cut the number of switches needed in rack-mounted systems by 90%, saving money and configuration time for network administrators.
In addition, because the system uses thinner, more common CAT5 cables, cable costs and clutter can be reduced over heavier wiring, IBM said.
ACT works by linking groups of 16 rack-mounted servers together, then plugging those bundled groups of servers into a 16-port management switch controlled by a single administrative console.
Consoles are available for local or remote control of the configuration. Traditional configuration methods required individual cables running from each server to a switch and a maximum of 16 servers connected to one switch.
Jeff Benck, director of product marketing for IBM's eSeries and xSeries servers, said ACT could save $67,000 (£47,472) in switch costs for each 256-server configuration while simplifying installation and administration.
Each 256-server system can be controlled using one keyboard, monitor and mouse.
IBM used a similar system for about two years for its Linux-based x330 1U rack-mounted servers using a C2T cable chaining technology, Benck said.
That system allowed 42 servers to be linked together, far fewer than the 256 allowed by ACT. The old C2T system did not offer remote administrative capabilities, he said. ACT is backward compatible with C2T, so those units could be connected and remotely operated.
Pricing starts at $1,300 (£824) for a local console system for up to 64 servers and $5,200 (£3,296) for a remote console for up to 256 servers. ACT will begin shipping at the end of this month.
IDC analyst Mark Melenovsky said the new daisy chaining system could make system setup and configuration easier for IT departments and simplify the addition of more servers.
He added that the technique could mean changes for the traditional keyboard, video and mouse (KVM) switch makers since it greatly increases the number of servers that will be operable from one KVM switch.
Other hardware vendors including Dell and Compaq also have similar cable reduction systems, but they only handle up to 40 servers.
IBM also unveiled its rack-based eServer x345 2U server with Intel Xeon processors and up to six hot-swap hard drive bays and five PCI slots. The x345 server is available with a choice of Microsoft Windows, Linux or Novell NetWare operating systems. The servers will begin shipping at the end of this month with a starting price of $2,799 (£1,774).