News release

HP Helps More Than 100 Customers Worldwide Move from Mainframes to Standards-based Platforms

CitiStreet, Aquila, Inc., Atmos Energy and others turn to HP Adaptive Enterprise strategy for greater IT simplicity, agility and value

HP today announced that it has helped more than 100 companies worldwide move their business-critical applications from mainframe-based to more open, standards-based information technology (IT) environments.

Customers such as CitiStreet, Atmos Energy Corporation and Aquila, Inc. are reaping the benefits that HP products, services and partners deliver to enable greater business agility - the ability to respond rapidly to changes in market conditions or customer demands - while lowering overall IT costs.

Companies worldwide are scrutinizing the agility, costs and labor issues associated with ownership of aging mainframe systems as rapidly changing business demands require more computing flexibility and access to the latest business applications. While newer mainframes have a role to play in some specialized, niche environments, customers with older mainframes have turned to HP's Adaptive Enterprise strategy and standards-based platforms for increased flexibility to synchronize business and IT while keeping costs under control.

"To meet evolving business requirements, IT organizations must minimize underlying infrastructure complexity while establishing the foundation for a new era of virtualized, utility-based, adaptive infrastructure," said Carl Greiner, senior vice president, Infrastructure Strategies, META Group. "IT expenditures must have strong business justification such as clear cost savings and improved agility."

CitiStreet is the second largest record-keeper in the United States and a premier provider of defined contribution, pension and health and welfare plans servicing more than 6 million participants. The company's legacy environment did not offer the always-on infrastructure and failover configurations needed for their business to grow. CitiStreet found that it could double performance with the HP Superdome server and reduce costs by 37 percent over three years for hardware maintenance and software license expenses.

"As a company in the competitive benefits space, CitiStreet must respond quickly to ever-changing client needs," said Barry Strasnick, chief information officer, CitiStreet. "We are migrating from our mainframe systems to HP to increase our agility, reduce costs and accommodate growth. We anticipate a twofold performance increase and the scalability we need, as well as the ability to make changes quickly to meet market and client demands."

Recent customer evolutions from mainframes to HP systems also include:

• Atmos Energy Corporation is one of the nation's largest pure natural gas distributors. After realizing its current mainframe environment was at its limits, Atmos Energy considered a newer mainframe but soon realized it could not provide the capacity, expandability and speed needed to accommodate the company's growth. The company opted to offload its applications onto HP servers to be more agile and ensure the ability to adapt in real time to business needs. As a result of implementing HP systems, Atmos Energy has been able to accommodate the growth in its IT needs and to increase manageability, removing the 24x7 support needed with the mainframe environment and relying on HP OpenView management software to automate systems management and proactively alert IT managers to issues.



• Aquila, Inc., an operator of electric and natural gas distribution facilities in seven U.S. states and Canada, faced the challenge of delivering greater IT infrastructure flexibility and capacity to support business initiatives while keeping costs down. After reviewing the costs associated with mainframe maintenance, Aquila found that HP's servers gave them the flexibility to run applications on multiple platforms and helped drive costs down for the organization.



• The chief information officer for operations of a major European retailer was looking for an IT environment that could support its growth while at the same time reduce costs and improve cash flow. With the help of the HP Financial Services sales-leaseback program, HP purchased the company's mainframes and leased HP Superdome servers bundled with software and refresh options. As a result of the migration, the firm has exceeded initial project expectations by reducing IT costs in one year by 30 percent. The company expects to achieve a return on investment in 24 months.

Other organizations around the world that have transformed their mainframe environments to more adaptive systems based on HP solutions include: Hyundai, GM Daewoo and KorAm Bank in Asia Pacific, KCM in Europe and ABSA Bank Ltd. in South Africa.

To help its customers update their IT environments, HP offers a range of standards-based platforms including HP ProLiant and HP Integrity systems as well as HP NonStop servers, which offer unparalleled availability and scalability. For many customers, data housed on a mainframe can be better utilized with complementary applications from Microsoft, BEA or Oracle running on HP servers. The systems provide excellent price-to-performance ratios and scalability, while working with HP offers greater integration options, operating system choices, platform breadth and a simple, direct approach updating the IT environments.

In addition, many mainframe customers are adopting the benefits of HP StorageWorks storage area networks to reduce their total cost of ownership through open, networked storage while delivering high returns on investment of as much as 100 to 500 percent.

HP also offers an Agility Assessment service of customers' existing environments to help get them started. With this service, companies can assess current levels of IT flexibility, find opportunities to incorporate new technologies, and determine their ability to integrate newly deployed applications and implement new business processes.

In addition, HP helps organizations incorporate IT management processes that use industry-leading practices in services management. HP Financial Services offers IT transition, acquisition, management and disposition services - including innovations in pay-per-use - to help customers increase return, reduce risk and improve business agility and bottom-line performance.

To schedule an HP Agility Assessment, customers can contact a local HP sales representative or find more information online at http://h71028.www7.hp.com/enterprise/cache/9131-0-0-225-121.aspx.

More information about the benefits of the HP Adaptive Enterprise strategy is available at http://www.hp.com/go/adaptive.

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 four fiscal quarters ended April 30, 2004, HP revenue totaled $76.8 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 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 proposed contract may not be entered into on the terms or within the timeframe currently contemplated or at all; 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; and other risks that are described from time to time in the Quarterly Report on Form 10-Q for the fiscal quarter ended Jan. 31, 2004, and other Securities and Exchange Commission reports, filed after the 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.