News release

Compaq Chosen by U.S. Postal Service to Provide Employees Affordable Technology, Internet Access

Compaq Computer Corporation (NYSE: CPQ) has signed an agreement with the US Postal Service to offer Presario Internet PCs and a variety of Internet services options to 800,000 postal employees in more than 42,000 locations across the United States, including Puerto Rico, Hawaii and Guam. In addition, Compaq will create a custom portal through which postal employees can securely access the USPS Intranet.

"Compaq has had a long and productive business partnership with the US Postal Service. We are pleased to have the opportunity to extend that partnership by offering USPS employees affordable personal technology and Internet connectivity," said Michael D. Capellas, Compaq's chairman and chief executive officer. "With Compaq's support, USPS has been a leader in using the Internet to increase efficiency and customer satisfaction. This new program will give employees secure access to the Postal Service Intranet and other Web resources."

Compaq's Consumer Group continues to hold the number one worldwide consumer PC market share position, according to the market research firm International Data Corporation.

Personal Computers, Internet Access, Custom Portal

Later this quarter, USPS employees will be able to purchase Compaq Presario Internet PCs configured anyway they like via a customized Web site or toll-free phone number. Compaq is offering USPS employees a specially customized PC and monitor bundle, a wide range of configurable Presario Internet desktop and notebook PCs, associated options and a variety of Internet services.

As part of this agreement, Compaq is making arrangements for USPS employees to receive special offers on Internet access from ISPs at reduced rates. Compaq will use its integration expertise to create a customized news and information portal that also provides USPS with a persistent and timely channel for employee communications. The integration of a Virtual Private Network (VPN) provides Postal Service employees with secure access to the USPS Intranet.

Compaq's Relationship with USPS

Compaq's relationship with USPS began in 1979 and has grown into a mutually successful business partnership. In the last six years, Compaq has shipped more than $1 billion of quality products and services to support USPS information technology infrastructure and strategic e-commerce revenue programs. Compaq is proud of being recognized by USPS as a Quality Supplier Award winner for 1997, 1998 and 1999. In 2000, Compaq was honored with their prestigious USPS Postmaster General Award in recognition of its partnership and delivering innovative technology solutions to help USPS address their business challenges.