News release

HP Outlines Plan to Help Broadcast Industry Capitalize on Digital Revolution

• Company combines intellectual property and partnerships to build industry's first Digital Media Platform
  
• HP teams with Warner Bros. and DreamWorks to enhance creation, distribution and consumption of digital content

At the National Association of Broadcasters conference today, HP advanced its digital entertainment strategy with a series of product, partner and customer announcements focused on enabling media and entertainment companies to capitalize on the digital revolution that is transforming their industry.

"The business model that has guided this industry for nearly a century is changing radically," said Carly Fiorina, HP chairman and chief executive officer. "Content is still and will always be king, however thousands of new storytelling experiences, applications and services are just around the corner. There is money to be made just as there is money to be saved - if this industry embraces the change and the opportunity the digital revolution presents."

At the center of HP's expanding digital entertainment strategy is the introduction of the first integrated, open platform that links all production and post-production technology and processes and strategic partnerships with two entertainment industry leaders - Warner Bros. Studios and DreamWorks.

HP Digital Media Platform transforms digital entertainment

HP is teaming with the entertainment industry's leading content creators, distributors and technology companies to develop the Digital Media Platform (DMP). A standards-based technology platform, the DMP will simplify and reduce the cost of content production, distribution and consumption in the entertainment industry. As a result, entertainment and broadcast companies can increase their focus on creating new entertainment experiences and revenue models.

The Digital Media Platform will combine software technology developed by HP Labs with expertise gained through HP's work with companies such as DreamWorks, Warner Bros. Studios, Starbucks, Avid and SAVVIS. By linking production and post-production applications, technologies and processes together in a workflow-based system, disparate creative teams will be able to simultaneously share a common set of media assets for production and post-production media applications such as rendering, editing, workflow, archiving and restoration.

As a result, entertainment and broadcast companies will be able to bring all types of digital entertainment - movies, television programming, music and gaming - to market more cost-effectively and through new distribution mediums.

HP helps digitize classic Warner Bros. Studios motion pictures and television shows

HP and Warner Bros. Studios announced a broad, strategic partnership to enhance the quality, post-production and distribution of entertainment content (see separate news release issued today, "HP, Warner Bros. Studios to Usher in New Era in Film and Television"). Initially, the companies will focus on two key projects:

• Digital restoration - The companies will pool their collective expertise in image processing to develop and deploy new techniques that will digitally restore the image quality of many of the world's treasured and classic motion pictures and television shows. The new digital restoration effort will combine Warner Bros. Studios' proprietary software - successfully used to restore the classic films "Singin' in the Rain", "Robin Hood" and "Meet Me in St. Louis" - with HP's industry-leading image, color and data management technologies and servers, software and storage systems. As a result, Warner Bros. Studios will now be able to increase the number and the quality of films that are restored and released per year.



• Digital post-production - HP and Warner Bros. Studios are teaming to create a new set of tools and infrastructure to build a post-production studio of the future. This new system will provide creative artists with enhanced flexibility and power throughout the digital post-production process, while preserving the resolution and image quality that has historically only been possible with traditional film-based techniques. As part of this project, HP and Warner Bros. Studios will define and develop tools to manage and manipulate the hundreds of terabytes of data that are needed to ensure content quality meets or exceeds the historical quality of 35mm film.

Warner Bros. Studios' feature film productions and high-definition television shows will be the first wave of digital entertainment content used to test and build the post-production studio of the future.

HP adaptive solutions offer DreamWorks maximum flexibility

HP and DreamWorks announced a significant expansion of their alliance by unveiling two innovative, new technologies that will shape the future of digital filmmaking (see separate news release issued today, "HP and DreamWorks Give Innovation a Starring Role in 'Shrek 2'").

• Utility Rendering Service (URS) -- Developed by HP in close collaboration with DreamWorks, URS addresses a very real and expensive problem in creating digital animation. Based on HP's Utility Data Center technology, URS provides a simple, flexible and scalable solution to manage the enormous computational power required to render high-quality film animation. In the process of rendering "Shrek 2," URS provided DreamWorks with 50 percent more capacity from a remote, pooled set of computing resources when it needed it most, without having to purchase additional computing resources.



• Virtual Studio Collaboration (VSC) - HP also partnered with DreamWorks to launch the VSC system, which uses movie-making techniques - lighting, sound design and visual effects - to create a virtual collaboration environment for producers, directors and animators working in different locations around the world. Using HP software and DreamWorks' high-resolution imaging technology, VSC links all creative elements together, enabling real-time, lifelike communication and the efficient exchange of storyboarding, content review, editing, creative consulting and other vital production information.

HP is partnering with DreamWorks to create the next generation of its VSC solution and plans to make it available to other studios and industries.

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 last four fiscal quarters, HP revenue totaled $74.7 billion. More information about HP (NYSE, Nasdaq: HPQ) 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 never 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. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including any projections of earnings, revenues, or other financial items; any statements of the plans, strategies, and objectives of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; statements of belief and any statement of assumptions underlying any of the foregoing. The risks, uncertainties and assumptions referred to above include employee management issues; the timely development, production and acceptance of services and their feature sets; the challenge of managing asset levels, including inventory; the difficulty of keeping expense growth at modest levels while increasing revenues; and other risks that are described from time to time in HP's Quarterly Report on Form 10-Q for the period ended Jan. 31, 2004, and HP's other Securities and Exchange Commission reports filed after HP's Annual Report on Form 10-K for the fiscal year ended Oct. 31, 2003. HP assumes no obligation and does not intend to update these forward-looking statements.