News release

Compaq to Join Starbucks and Microsoft to Create Breakthrough Wireless Customer Experience

Compaq Computer Corporation (NYSE: CPQ) and Starbucks Coffee Company (Nasdaq: SBUX) today announced a five-year strategic relationship in which Compaq was named Starbucks preferred information technology infrastructure provider for its retail stores and corporate headquarters. The two innovative companies will work together to blend technology and lifestyle, thereby enhancing the Starbucks Experience and supporting global growth.

"Starbucks chose to partner with Compaq to leverage the power of two great brands as we enhance our customers' in-store experience through leading-edge technology," said Howard Schultz, Starbucks chairman and chief global strategist.

Compaq will join Starbucks and Microsoft in creating a high-speed connected environment in Starbucks locations across North America. Compaq, a worldwide leader in mobile computing devices, has been named the in-store Internet access device provider for the wireless broadband network. In the future, Starbucks customers will be able to enjoy their favorite coffee beverages while accessing broadband content and services through innovative Compaq wireless devices such as the hot-selling, award-winning iPAQ Pocket PC or their own wirelessly enabled devices.

"Compaq's vision for a wireless Internet is all about delivering personalized content with anytime, anywhere access," said Michael Capellas, Compaq's chairman and chief executive officer. "This alliance with Starbucks is strong evidence of our focus on deploying innovative products and providing solutions for our partners' success."

"This agreement allows us to take advantage of Compaq's incredible breadth and depth of technology and service offerings to continue to improve many aspects of our business," said Darren Huston, senior vice president of New Ventures at Starbucks. "Working closely with Compaq and Microsoft on enterprise and consumer-facing innovations will ultimately help us improve store operations and enhance the experience of our customers."

Under this agreement, Compaq will be the primary and preferred strategic provider for information technology infrastructure for Starbucks, such as enterprise class servers and storage solutions, desktops and laptops and iPAQ products, and will assess both present and future technology needs to support Starbucks global growth.

Starbucks Background

Starbucks Coffee Company is the leading retailer, roaster and brand of specialty coffee in the world. In addition to its more than 4,100 retail locations in North America, the United Kingdom, continental Europe, the Middle East and the Pacific Rim, Starbucks sells coffee and tea products through its specialty operations, including its online store at Starbucks.com. Additionally, Starbucks produces and sells bottled Frappuccino^®coffee drink and a line of superpremium ice creams through its joint venture partnerships. The company's other brands enhance the Starbucks Experience through best-of-class products: Tazo Tea Company offers a line of innovative premium teas, and Hear Music produces and distributes a line of exceptional compact discs.