News release

Compaq Unveils Innovative Productivity Tools for Internet-Driven Home and Home Office

Continuing to provide innovative products and services that work together to help customers communicate and create at work or at play, Compaq Computer Corporation (NYSE: CPQ) today announced Windows XP compatibility for all new Presario PCs, as well as a variety of enhancements to their Presario lineup.

In addition to technology upgrades to the Presario desktop and notebook PCs, Compaq unveiled enhancements to the popular MyMovieSTUDIO DVD movie-making solution, EA Sports™ and EA Games™ Bundle software for the sports gaming enthusiast, and an economical computing solution including a new value-priced PC, inkjet printer and flatbed scanner.

"These expanded productivity tools and entertainment options are examples of solutions our customers have told us they value," said Alex Gruzen, vice president and general manager for Home and Office Access in Compaq's Access Business Group. "With the continual feedback we receive from our customers, Compaq continues to deliver first-to-market technologies that define the ultimate computing experience."

(Editor's Note: Please see today's related announcement, "New Compaq PCs Set Threshold for Most Secure and Confident Internet Purchasing Experience," unveiling Compaq's new Smart Credit Card Internet Keyboard, Coloreal color management technology and Norton Security Suite.)

Presario Software Upgrades

Compaq today announced that all Presario Internet PCs shipped as of June 27 will be Windows XP compatible, so there's no need to wait to purchase a PC to take full advantage of the latest software upgrades. All models will come with an easy reference card in the box with specific instructions on how to obtain software for Windows XP through the mail for a nominal charge, to help make the upgrade process as quick and convenient as possible. Compaq's Windows XP upgrade kit will include additional software drivers that will ensure the easiest and most seamless upgrade experience for those purchasing a Presario PC in the July timeframe.

And for gaming enthusiasts, Compaq will offer countless hours of nonstop action with five popular Electronic Arts sports and games titles that come standard on selected Presario 5000 and 7000 series desktop retail models this summer. The full version titles in the Compaq-exclusive EA Sports™ and EA Games™ Bundle include Madden NFL™ 2001, Triple Play™ 2001, Tiger Woods PGA TOUR^® 2001, Need for Speed™ - Porsche^® Unleashed and SimCity 3000™ Unlimited.

To increase customers' peace of mind, as of June 27, all Presario PCs will be shipped with Norton™ Internet Security 2001 software, providing consumers the confidence that their privacy and important information are protected from Internet threats. This comprehensive software suite includes Norton Personal Firewall to defend against hackers, and award-winning Norton Anti-Virus to eliminate dangerous viruses. It also lets customers keep personal information private, control Internet "cookies," and block banner ads to accelerate download speeds with Norton Privacy Control.

Presario Desktop and Notebook Enhancements

Just in time for back to school, Compaq released the value-priced Presario 4000 personal computer. From access to the Internet and e-mail, to taking care of your personal or small business finances, to helping with homework or playing games, the Presario 4000 is a simple and smart solution for full-featured Internet computing. Its easy out-of-the-box setup provides almost instant access to the Web. The new compact, sleek tower design fits stylishly on or under a desk and features tool-less, easy access to allow quick addition or exchange of components for upgrades or servicing. Providing a compact solution for today's Internet experience, the Presario 4000 personal computer is a perfect PC for any home or home office.

And as with any new Presario PC, the Presario 4000 includes one year of free, 24-hour technical support via the Web or a toll-free number. The Presario 4000 desktop PC, priced at just $529, will be available in participating retail locations across the country July 1. For more information about the Presario 4000 desktop PC, visit http://athome.compaq.com/desktops.

The Presario 7000 Series offers smart solutions and exceptional performance with the new 64 MB Nvidia GeForce2 MX graphics card. Delivering the power of a Graphics Processing Unit (GPU) to the mainstream computer, the GeForce2 MX blazes through games and applications, providing an unprecedented visual experience thanks to features like transform and lighting, per-pixel shading, and advanced video processing. And select models of the 7000 Series now feature the powerful combination of new AMD Athlon™ processors and fast Double Data Rate (DDR) PC2100 memory. The combination of this new, high-speed processor, a 266 MHz system bus and incredibly fast and affordable DDR memory technology make this an ideal PC platform for extreme gaming, digital video editing and advanced multimedia applications.

Another upgrade to the Presario 7000 is with the popular MyMovieSTUDIO home movie-making solution with DVD-R technology. Available through Compaq's AtHome Web site and "Built for You" kiosks in more than 9,000 retail outlets throughout the United States, MyMovieSTUDIO Presario PCs will now be able to configure with the ATI All-In-Wonder graphics card, allowing users to watch and capture television content for their home movies. ATI's All-in-Wonder graphics card also includes an impressive software utility that allows a PC to function as a digital VCR that can be programmed to capture television content for convenient playback. The Compaq MyMovieSTUDIO also allows consumers to create DVD movies on inexpensive DVD-R media and play them on most console DVD players.

The newest Presario notebooks feature an ideal blend of technology, perfect for students living in dorm rooms or anyone who demands the most from an on-the-go lifestyle. Compaq announced all new Presario notebooks will also ship Windows XP ready and the availability of AMD Athlon and Duron processors on select notebook models in retail locations. The new Presario 1800 series notebook available in retail features a larger, 15-inch SXGA+ panel display and 16 MB of dedicated video memory, offering a higher quality picture and increased information content than an XGA display. With an AMD 1 GHz notebook priced at just $1799, larger displays and hard drives, and DVD drives on all models, mobile users need make no compromises with Presario notebooks. New Presario notebooks will be available in retail June 27. For more information visit http://athome.compaq.com/notebooks.

Productivity Tools for the Home & Home Office

Compaq also released the $129.99 IJ650 color inkjet printer, an economical answer to the computing needs of students, multiple PC households and most home offices. The IJ650 leads the industry with 2400 dpi resolution, providing photo-quality printing and a smaller ink drop size at a breakthrough price. The IJ650 will be available in participating retail locations July 1. And when consumers purchase a CPU, monitor and printer through retail, they will receive a $200 rebate between July 8 and October 21, 2001. For more information visit http://athome.compaq.com/printers.

For students, home offices and small businesses with more demanding imaging needs, Compaq offers the S200 high-performance flatbed scanner. With high-quality scanning at an incredible speed and quick, easy setup, the S200 makes it simple to post photos to Web sites or share them with friends and family via e-mail. With the touch of a single button, users can scan images up to 8.5" X 11.7" to add life to school projects or business presentations. The S200 has 48-bit color depth and scans at up to 1200 x 2400 dpi optical resolution, but can be expanded up to 9600 dpi, providing laser-sharp text and brilliant color images. Coupled with the value-priced Presario PC and IJ650 printer, the S200 completes an ideal solution for tackling school projects or the presentation needs of a home office. Priced at $99, the S200 will be available through retail on July 1. For more information about the S200, visit http://athome.compaq.com/printers.

The breadth of these new offerings from Compaq are available at Compaq's Web site at http://www.compaq.com/athome, by calling 1-800-888-0220 and through Compaq kiosks located in more than 10,000 popular retail stores.

About Compaq

Compaq Computer Corporation, a Fortune Global 100 company, is a leading global provider of technology and solutions. Compaq designs, develops, manufactures, and markets hardware, software, solutions, and services, including industry-leading enterprise computing solutions, fault-tolerant business-critical solutions, and communications products, commercial desktop and portable products, and consumer PCs that are sold in more than 200 countries. Information on Compaq and its products and services is available at http://www.compaq.com.