News release

HP to Feature DVD+R/RW Drives in Home PCs this Fall

HP PCs with Recordable, Rewritable DVD Drives Offer Custom CD and DVD Creation in One Product

PALO ALTO, Calif., June 19, 2001

Hewlett-Packard Company (NYSE:HWP) today announced plans to incorporate recordable, rewritable DVD (DVD+R/RW) drives into its home PCs, further expanding its portfolio of digital entertainment products.

By incorporating DVD+R/RW drives, HP Pavilion home PCs will allow consumers to store, edit and preserve video; create and play custom music, data or photo CDs and DVDs; and store large amounts of data. Using an HP Pavilion home PC with a DVD+R/RW drive, consumers will be able to edit a movie created with a camcorder, add music and then record the movie onto a DVD.

Users of the HP home PCs with DVD+R/RW drives -- expected to be available this fall -- will be able to play their newly created DVD discs in the majority of DVD players and DVD-ROM drives in use today due to its two-way compatibility. Additionally, custom CDs will be playable in most CD players and CD-ROM drives.

"Rewritable DVD is the next big step in the evolution of home PCs," said Mark Sanchez, marketing manager, HP North America Consumer Computing Organization. "DVD+R/RW-enabled HP Pavilion home PCs will enable our customers to explore a variety of digital entertainment activities, including creating, editing and storing digital video or music or organizing their entire photo collections."

Industry analysts predict DVD recording will be a hot technology driving PC sales over the next several years. According to Dataquest, 2.13 million rewritable/recordable DVD drives will be sold by 2002. By 2005, that number will reach 14.5 million drives.⁽¹⁾

HP is a founding member of the DVD+RW Alliance, a group of leading personal computing and consumer electronics companies, including Philips Electronics (NYSE:PHG), Sony Corporation, Ricoh Company Ltd., Thomson Multimedia (NYSE:TMS), MCC/Verbatim and Yamaha Corporation, dedicated to the consumer benefits offered by DVD+R/RW technology. For more information on the DVD+RW Alliance, interested parties can visit http://www.dvdrw.com/.

"We chose the DVD+R/RW standard because it was designed to deliver exceptional reliability and quality in both data and video recording, while giving our customers optimal compatibility between home office computing equipment and consumer electronics components," said Sanchez.

About HP

Hewlett-Packard Company -- a leading global provider of computing and imaging solutions and services -- is focused on making technology and its benefits accessible to all. HP had total revenue from continuing operations of $48.8 billion in its 2000 fiscal year. Information about HP and its products can be found on the World Wide Web at http://www.hp.com.

⁽¹⁾ Dataquest, "2001 Optical Drive Market: Market Share and Forecast," June 14, 2001.

This news release contains forward-looking statements that involve risks, uncertainties and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. Risks, uncertainties and assumptions include the possibility that the market for the sale of certain products and services may not develop as expected; that development of these products and services may not proceed as planned; and other risks that are described from time to time in HP's Securities and Exchange Commission reports, including but not limited to the annual report on Form 10-K for the year ended Oct. 31, 2000, and subsequently filed reports. If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, HP's results could differ materially from HP's expectations in these statements. HP does not intend to update these forward-looking statements.