News release

Compaq Continues its Consumer Electronics Market Expansion with the Launch of the Perfect Holiday Gift

Compaq Computer Corporation (NYSE: CPQ), a global enterprise technology and solutions company, today augmented its broad range of battery-powered, portable audio products with the introduction of the pocket-sized, value priced iPAQ Personal Mini-CD Player PM-1. As the perfect holiday gift, the iPAQ Personal Mini-CD Player will stuff stockings with sound—80 songs providing six hours of digital music on a single disk that is over 50 percent smaller than a standard CD—for only $99.99.

The company also announced the immediate availability of the iPAQ Personal CD Player PCD-1, announced earlier this year. With the capacity to store 300 songs—about 20 hours of digital music—and a price tag of $169.99, the PCD-1 is a perfect match for the gift-giving season.

"The iPAQ family of audio products is designed to satisfy the audio needs of the most demanding music enthusiast by providing customization, organization and storage capabilities never before available in consumer electronics devices," said Sean Burke, vice president and general manager for iPAQ Products and Connected Devices in Compaq's Access Business Group. "By bridging Compaq's expertise in PC technology with the move to digital media in the consumer electronics world, we're providing the highest quality digital audio anytime and anywhere."

iPAQ Personal Mini-CD Player PM-1

With its small size, durability and simplicity, the iPAQ Personal Mini-CD Player PM-1 is the ideal choice for music and technology lovers with an active lifestyle. Able to fit easily into a shirt pocket, the iPAQ PM-1 provides an aggressive 480 second shock protection, making annoying skips in a song practically a thing of the past. The device comes ready to play crystal-clear digital audio from standard mini-CDs, supporting both mini-CD-Rs (recordable) and mini-CD-RWs (re-writeable) formats with 555 Megabytes of included storage.

In addition, the PM-1 comes with rechargeable batteries to help keep the music playing on the go. The PM-1 has a full-featured in-line remote which includes a large LCD display, allowing users to see the functions, track, artist and elapsed time on the screen of their favorite MP3 songs while leaving the player tucked away in a pocket or backpack. The line out and AC adapters features allow the users to plug into their home stereo system and enjoy hours of music without the need for batteries.

Packaged with the PM-1 is MusicMatch Jukebox 6.0 and Windows Media™ 7.0 Player software, giving the user the ultimate in flexibility to play and manage their music. Microsoft Windows 98 or higher is the required operating system, including Windows XP, to create high-quality audio files. The iPAQ PM-1 will be available October 22 for the low price of $99.99.

iPAQ Personal CD Player PCD-1

Compaq also announced today the availability of the iPAQ Personal CD Player PCD-1. Designed for the mobile audio aficionado who wants an entire music collection available at home or away, the PCD-1 is the fullest featured, highest quality portable MP3 CD player, allowing users to listen to recordable CDs (CD-Rs) and re-writeable CDs (CD-RWs) that hold up to 300 songs in MP3 or WMA formats—or 20 hours of music—on a single disc.

In addition, the PCD-1 plays traditional compact discs and includes an FM tuner, providing the widest variety of listening choices. The PCD-1 also features rechargeable batteries, for added convenience.

The PCD-1 is a solution that gives consumers total control over their music with playlist management that allows grouping and categorizing of songs or albums for fast and easy selection.

The PCD-1 also includes customizable equalizer settings for high-quality digital sound performance and a display screen that lists track and artist information for each song. In addition, the PCD-1 can connect to a home stereo for hours of music at home.

And with the built-in infrared remote control, the listening experience can be enjoyed and leisurely managed from across the room.

Packaged with MusicMatch Jukebox 6.0 and Windows Media™ 7.0 Player software and easily upgradable to support future formats, the iPAQ Personal CD Player PCD-1 is available today for $169.99.

Availability

For more information on the iPAQ PM-1 and PCD-1, visit www.compaq.com/iPAQaudio.

In addition to retail outlets, these iPAQ audio products will also be available for purchase through Compaq's ™Built for You™ kiosks at participating retailers, on Compaq's Web site at http://www.compaq.com and by calling 1-800-888-0220. Compaq's ™Built for You™ program allows customers to configure their PCs to meet their specific needs and gives them access to the latest products as soon as they become available. All iPAQ products also come with quick and effective product care and customer service for the full life of the product. Visit www.compaq.com/consumersupport for the fastest path to accurate answers.

Company Background

Founded in 1982, Compaq Computer Corporation ("Compaq") is a leading global provider of enterprise technology and solutions. Compaq designs, develops, manufactures and markets hardware, software, solutions and services, including industry-leading enterprise storage and computing solutions, fault-tolerant business-critical solutions, communication products, and desktop and portable personal computers that are sold in more than 200 countries. Information on Compaq and its products and services is available at http://www.compaq.com.