News release

Compaq Forms Global Team to Focus on Small and Medium Business Market

Compaq Computer Corporation (NYSE: CPQ) today announced new products, services and solutions focused on empowering small and medium sized businesses (SMBs) to launch and run their companies more efficiently and effectively by leveraging the power of the Internet.

According to a recent IDC report¹, small businesses are growing and using the Internet more frequently to conduct electronic commerce and customer outreach. To address this market opportunity, Compaq announced the formation of a Global SMB organization focused on making it easier for these businesses to purchase, deploy, manage, and harness the power of the Internet so they can focus on the challenges of running their businesses. Mike Mata, Global Vice President of Small and Medium Business, will concentrate on bringing together leading-edge capabilities into simple, customized, scaleable solutions. Robyn West was named as Vice President of Small and Medium Business in North America.

Among the offerings announced today are:

• Net Solutions for Business, a set of integrated, online tools to help customers use the Internet to run the day-to-day tasks of a growing business
• A new sub-$1,000²Compaq ProLiant server, and a value-priced Armada notebook PC, two Deskpro EX desktop PCs and a Deskpro workstation
• New financing programs for growing businesses
• A time-saving online store called Bequipt, featuring thousands of industry-wide brand-name peripherals
• A customizable extranet program called Business Advantage for SMBs to order directly from Compaq, and
• SMB-tailored service and support programs called CarePaqs, including a Portable Protection Program.

"There are several distinct small and medium sized business markets - everything from local community-based business to emerging enterprises - each requiring a different offering and approach," said Mata. "With today's announcement, we are harnessing Compaq's diverse technology strengths and economies of scale to expand the breadth of solutions and services aggressively priced and ideally suited to these SMB customers."

"Compaq is now the one source from which a growing business can get the full power of an I.T. department - without the overhead."