News release

HP to Help Standardize and Simplify Operations at IRS with $50 Million in Servers and Network Storage

HP teams with PlanetGov to cut costs and complexity at IRS through IT consolidation

HP (NYSE:HPQ) today announced that its partner, PlanetGov, has been awarded a single-award blanket purchase agreement by the Internal Revenue Service, a branch of the Department of Treasury, to implement an industry-standard server and network storage solution for IT consolidation. The contract, a blanket purchase agreement with an estimated value of $50 million, will enable the IRS to simplify, integrate and remotely manage its information systems.

Under the terms of the contract, the IRS expects PlanetGov and HP to replace a percentage of the 4,400 IBM and Dell servers and approximately 30 storage area networks currently in use at the IRS during each of the next four years. HP will provide approximately 3,000 industry-standard HP ProLiant servers, including blade servers, 30 HP StorageWorks storage area networks and professional consulting services.

The contract is in addition to a three-year, $100 million purchase agreement HP and PlanetGov secured in 2002 to supply the IRS with Compaq Evo desktop and notebook PCs.

"Together with HP and PlanetGov, the IRS is addressing IT challenges associated with the growing American taxpayer base," said Jim Weynand, vice president and general manager, Public Sector Organization, HP. "This agreement extends and expands the commitment of HP and PlanetGov to assist the IRS in cutting systems administration costs by simplifying its IT infrastructure with industry-standard solutions."

"PlanetGov recognizes the technical strength and product depth of HP and is proud of the relationship our companies have forged to deliver this enterprise solution of product, consulting and design services," said Steve Baldwin, chief executive officer, PlanetGov. "HP assisted us in meeting the IRS requirement of a 'partnering solution.' Together, we are providing the IRS with a blueprint for the implementation of emerging technology through the consolidation of servers, while providing maximum storage capabilities and efficient system management tools and practices for network enterprise solutions."

PlanetGov, an information technology systems integrator and professional services company, primarily assists federal government customers with network engineering and convergence, security and information assurance and major systems deployment to improve productivity. PlanetGov is a privately held corporation with annual revenues of more than $300 million.

About HP

HP is a technology solutions provider to consumers, businesses and institutions globally. The company's offerings span IT infrastructure, personal computing and access devices, global services and imaging and printing. For the fiscal year ending on Oct. 31, 2003, HP revenue totaled $73.1 billion. More information about HP is available at http://www.hp.com.

This news release contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they ever materialize or prove incorrect, could cause the results of HP and its consolidated subsidiaries to differ materially from those expressed or implied by such forward-looking statements and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. Risks, uncertainties and assumptions include the possibility that the market for the sale of certain products and services may not develop as expected; that development and performance of these products and services may not proceed as planned; any statements of belief; any statements of assumptions underlying any of the foregoing; and other risks that are described from time to time in HP' s Quarterly Report on Form 10-Q for the period ended July 31, 2003 and HP' s other Securities and Exchange Commission reports filed after HP' s Annual Report on Form 10-K for the fiscal year ended October 31, 2002. If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, HP's results could differ materially from HP's expectations in these statements. HP assumes no obligation and does not intend to update these forward-looking statements.