News release

Compaq Starts New Year Fresh with Enhanced Consumer Line

New Compaq Presario PCs offer Latest Processing Technology, DDR Memory, New Smart Card Solution, Productivity Software and Digital Entertainment Bundles

Compaq Computer Corporation (NYSE: CPQ) is rejuvenating its Presario line with new desktop and notebook PC models for the new year to help consumers simplify their lives, connect their world and have fun with the latest in Intel Pentium® and AMD Athlon™ processors, new smart card solutions for the Internet, outstanding value bundles and more.

The Compaq Presario 8000 series now features two new models with AMD's just-announced Athlon XP 2000+ 1.67 GHz or Intel's new Pentium 4 2.2 GHz⁽¹⁾ processors. The Presario 8000 with AMD's Athlon XP 2000+ processor features DDR PC2100 memory, QuantiSpeed™ architecture and delivers up to a 25-percent performance advantage versus competitive 2 GHz processors on real-world applications, such as digital media, office productivity and 3D gaming software packages. The Presario 8000 PC with the new Athlon XP 2000+ processor starts at $1199 from Compaq.com.

The new Presario 8000 PC with Intel's Pentium 4 2.2 GHz processor with DDR PC2100 memory offers NetBurst™ micro-architecture designed to deliver highest performance in video, graphics, multimedia and other sophisticated applications, starting at just $1499 direct from Compaq. Additionally, select Compaq Presario 5000 and 8000 systems with Intel Pentium 4 processors are now available with DDR PC2100 memory, which is twice as fast as the SDRAM PC133 memory.

"With these new processors and software offerings, Compaq strives to bring customers the very latest in technologies and productivity tools to make the PC an easy-to-use, yet powerful tool to help simplify daily tasks like balancing a checkbook and surfing the Web, while also providing the highest performance graphics and speed for gaming and digital media enjoyment," said Kyle Ranson, vice president of marketing in Compaq's Access Business Group.

Compaq Entertainment and Productivity Solutions for Home and Home Office

In addition to the two new Presario 8000 models, Compaq will also offer three new Presario 5000 models with additional entertainment and productivity solutions. The company will offer a new non-payment Presario Internet Smart Card solution, powered by Netissimo®, to accompany its Compaq Smart Credit Card Internet Keyboard for Presario 5000 and 8000 desktop PCs. The new Presario Internet Smart Card features an embedded microprocessor chip that allows users instant, secure Internet log-on and off, quick and easy access to Web sites and e-mail by storing links, unique passwords and login information for favorite Internet sites, and other online convenience utilities.

In addition, Compaq is offering consumers new productivity and software bundles with Presario desktop PCs. In conjunction with Intuit, Compaq U.S. customers can prepare and file income taxes for free using TurboTax for the Web if they purchase a new Presario desktop PC between January 9, 2002 and April 14, 2002. Consumers will also be eligible to enter a sweepstakes that could win them up to $5000 or a Compaq iPAQ Pocket PC with the purchase of their new Presario PC. All Presario desktop PCs also now feature Quicken financial software for easy organization of personal finances, paying bills and tracking investments.

Recently, Compaq also began offering online data backup and recovery through an agreement with Connected Corporation, for as low as $6.95 per month for up to 100 MB of data, or $14.95 per month for up to 4 GB of data. Both service levels include a no-risk, 30-day free trial period.

Compaq is also making digital music and photo storage and management more intuitive by expanding the popular MyMovieSTUDIO suite to offer MyPhotoSTUDIO and MyMusicSTUDIO bundled solutions. The MyPhotoSTUDIO bundle includes a digital photography starter kit, featuring the Epson photo printer, Fuji FinePix A101 1.3MP Digital Camera, MGI PhotoSuite 4 Platinum Edition MGI, camera case, printer cable, media holder and photo paper for just $299.95. The MyMusicSTUDIO bundles includes a value kit, featuring the NewQ E-Platinum External Player FM tuner/synthesizer, Altec Lansing ATP3 2.1 speakers, Avery CD Stomper CD/DVD Labeler and Music Match Jukebox Deluxe 6.0 for $149.95 or Compaq's new iPAQ Personal Mini-CD Player PM-1 and Imation 10-pack of mini-CDR media for $99.95.

New, Faster Presario Notebook PCs

Compaq is also announcing four new models in its Presario notebook PC series for 2002, including new processors and software, and enhanced displays.

The Presario 2700 notebook series, featuring mobile desktop performance with dual optical drives (8X CD-RW and 8X DVD), are now available with Intel's new Mobile Pentium III-M 1.13 GHz processors and 512 MB RAM. Redefining power, freedom and mobile design, Presario 2700 models start at just $1699.⁽²⁾ The affordable, feature-rich Presario 700 notebook now features an enhanced 14.1-inch TFT XGA display and DVD combo drive for $1399⁽²⁾ with an AMD Mobile Athlon 4 1.2GHz processor, or $1149⁽²⁾ with an AMD Mobile Duron™ 1 GHz processor. The thin and light Presario 1700 notebook PC now features a 14.1-inch TFT XGA display, with hot-swappable DVD/CD-RW combo drive, and 20 GB hard drive for just $1599.⁽²⁾

All new Presario notebooks also now include Roxio Easy CD Creator 5.1 and InterVideo WinDVD 3.0 for simple CD creation and DVD viewing, while the full-featured Presario 2700 notebook also includes Studio DV for personalizing home movies burned to CD-RW by adding custom soundtracks, voice-over narrations and scene transitions.

To protect notebook PCs from damage and accidents, Compaq also offers Accidental Damage Protection Service for all Presario notebooks. For just $99, the service provides one full year of protection against various types of accidental damage, including spills, drops, falls, collisions, and electrical surges that are not covered under the standard limited warranty.

In addition to these enhanced new lines of products, Compaq customers can rely on Compaq award-winning customer care and service. Customers have the option of calling Compaq's technical support line at 1-800-OK-Compaq or e-mailing their questions 24 hours a day, seven days a week to www.compaq.com/consumersupport, through which Compaq provides the fastest average response time of just one hour. For more information about these and other Compaq products, go to Compaq's Web site at http://www.athome.compaq.com, visit a Compaq kiosk located in more than 10,000 popular retail stores and many traditional retail locations, or call Compaq at 1-800-888-0220.

Company Background

Founded in 1982, Compaq Computer Corporation 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.