News release

HP Energizes Enterprise Imaging and Printing Growth with Revitalized Sales Approach, Expanded Portfolio

Unveils new ink-based printing technology for high-volume workload

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HP today bolstered its enterprise imaging and printing product portfolio and strategy, including plans to increase the size and expertise of its sales force, to provide customers with unprecedented levels of service, information and business insight.

As part of the announcement, the company unveiled an ink-based printing technology - HP Edgeline - specifically designed to handle the high-volume workloads of businesses. Printers using this technology feature printheads that span the width of a page - so only the paper moves, not the printheads. This allows print jobs to be completed in one pass, quickly and precisely with excellent quality.

HP additionally announced its largest-ever rollout of multifunction printers, which are aimed at replacing copiers in businesses of all sizes. The company also is making new investments in enterprise solutions and services, including the HP Halo Collaboration Studio, which enables customers to do business in a life-like, face-to-face environment regardless of the geographic distances separating them from their colleagues.

With these announcements, HP now provides enterprise imaging and printing customers with a full suite of services and solutions enabled by a world-class product portfolio.

Investing in sales force, expertise and tailored offerings

As part of a revitalized approach to make it easier to do business with HP, the company plans to hire hundreds of highly skilled sales consultants who will be dedicated to the company's top 2,300 accounts. These experts will engage customers in conversations that go beyond simple cost cutting to understanding how to apply the information enabled by the imaging and printing devices on the network to build competitive advantage.

HP's strategy includes establishing teams of specialists that can address customers' broad business environments as well as their specific IT and end-user challenges. In addition to an account manager, each team will include specialists in technology, services and business processes with knowledge of the workflows, vertical applications and HP capabilities relevant to their customer's specific needs.

Finally, HP plans to tailor some of the more than 200 imaging and printing solutions within its portfolio to build industry-specific offerings for major vertical markets in the public and commercial sectors. Delivering proven expertise to new customers, the vertical solutions will address critical business needs such as improving processes, operational efficiencies, cost savings and revenue.

"By leveraging our strengths in IT and our expertise in imaging and printing, HP is best-positioned to capture, manage and deliver the intelligence that enterprise customers need to improve their business processes," said Vyomesh Joshi, executive vice president, Imaging and Printing Group, HP. "This is not only about cutting costs. It's about using HP's services and solutions to help customers manage business information more efficiently to improve productivity and competitive advantage."

HP Edgeline Technology: Redefining business printing

The first-of-its-kind design architecture of HP Edgeline Technology uses page-wide printheads to distribute ink rapidly and precisely in one pass. With the versatility and scalability to meet many customer needs, the technology will allow HP to expand its printer business into markets such as retail printing solutions, industrial printing and high-volume office printing, which together will represent an estimated $30 billion-plus market opportunity by 2009.⁽¹⁾

HP Edgeline Technology already powers the recently introduced retail photo kiosk, the HP Photosmart Express Station, as well as the HP Photosmart pm1000 Microlab printer - both of which produce photo lab-quality prints in as fast as five seconds.

This spring, HP plans to unveil this patented technology in the first device that combines the benefits of ink and laser. The company expects the products using this technology to redefine business printing with some of the best printing speeds,⁽²⁾ operating costs⁽³⁾ and reliability⁽⁴⁾ in its class while providing excellent text and graphics print quality using specially formulated HP Vivera inks.

"With the Edgeline announcement from HP, we believe that the promise of inkjet for wide deployment in the higher end of the workgroup is close to being realized," said Charlie Corr, group director, InfoTrends. "To put it simply, this is a big deal."

Largest multifunction printer rollout in company history

HP's new multifunction printer (MFP) lineup adds to the HP LaserJet portfolio, which offers the industry's most complete set of options for both enterprise and small- to mid-size business customers. Highlights include:

• HP LaserJet M3035 MFP - A compact, affordable work team MFP that delivers 35 pages per minute with exceptional output and a convenient stapler. It also includes the new HP Easy Select Control Panel, an intuitive touch-screen that visually walks users through procedures and assists with setup and troubleshooting.⁽⁵⁾ Priced starting at $1,999.⁽⁶⁾



• HP LaserJet M4345 MFP - The next generation of the No. 1 selling device in its class, the M4345 offers printing, copying, optional faxing and advanced digital sending with paper handling, finishing and the HP Easy Select Control Panel. Priced starting at $2,599.⁽⁶⁾



• HP LaserJet M5035 MFP - HP's first and the industry's fastest desktop, wide-format MFP, the M5035 provides cost-effective wide-format printing and copying, faxing and stapling options, with advanced digital sending and the HP Easy Select Control Panel. Priced starting at $3,999.⁽⁶⁾



• HP LaserJet CM1015 MFP - The world's smallest color laser MFP, the CM1015 uses HP ColorSphere toner to provide great color output and high performance at a price that makes it the first color laser MFP to start under $500.⁽⁶⁾

HP also introduced the efficient, monochrome HP LaserJet P3005 series. Fast, feature-packed and network capable with optional two-sided printing, the series is ideal for document-intensive, small work team environments requiring high-quality printing with low maintenance. Priced starting at $549.⁽⁶⁾

To improve the effectiveness of general office documents and marketing collateral, the new HP Color LaserJet CP4005 offers durable, high-performance color printing with easy sharing and low operating costs. The series is designed for HP ColorSphere toner, which provides stunning high-quality prints, and is priced starting at $1,299.⁽⁶⁾

More information regarding the products mentioned above, as well as other versions within the products series, is available in an online press kit at http://www.hp.com/go/enterprise2006.

Partnering to meet customer needs

In addition to developing a portfolio of security, document capture and output management solutions and services, HP has forged relationships with top solution providers to address a wide variety of customer needs. HP helps customers reduce operational costs while improving productivity, ensuring compliance with government regulations and increasing IT efficiency with companies such as:

• Capella Technologies' Megatrack Agent - Capella now offers a job accounting and security solution that is fully integrated with HP Web Jetadmin, the industry's leading management software.



• eCopy Desktop - HP has selected eCopy as the desktop solution for its MFP users, allowing them to manage, modify and share portable document format (PDF) documents and making it easy to incorporate paper-based information into electronic business processes. Customers can scan documents directly from an HP MFP to eCopy Desktop using a new software utility from eCopy.



• Kofax Ascent - Kofax has integrated the Ascent platform with HP MFPs to automate information captured from scanned business documents and forms, delivering the content into an organization's business application or database.



• AutoStore - NSi's AutoStore will be resold by HP as a Premier Partner solution to offer customers a solution for scanning into existing content management and line of business applications.



• Omtool AccuRoute - Omtool now offers an enhanced version of its enterprise document capture solution, AccuRoute, that is designed to work with HP MFPs.

Two additions to HP Output Management Solutions portfolio include HP International Printing for HP Output Server, which accepts Unicode-based documents from SAP and other enterprise applications and transforms the information, intelligently sending output to multiple destinations. Also, HP Output Management Web Console: Job Manager, which is a web-based tracking and management HP Output Server utility that provides single log-on authentication and access across single and multiple domains.

Additional highlights

Rounding out HP's enterprise printing push is an update to HP Web Jetadmin, new document management and security services, an agreement with Standard Register and continued expansion of the HP Halo Collaboration Studio.

• HP Web Jetadmin 8.1 now includes Report Generation Plug-in 3.1, which enables customers to conduct more scheduled reports than before and perform asset utilization tracking that aids in understanding cost of ownership and planning for future purchases. HP Web Jetadmin is key to converting information across the network to true insight that allows enterprise customers to save costs and improve efficiency.



• New HP Document Capture and Security Assessment and Document Capture and Security Delivery Services provide an analysis of business document processes as well as how to improve and secure them. The result is increased employee productivity, better compliance with regulatory actions, improved security and a single point of contact.



• Standard Register - A premier document services provider, Standard Register and HP have signed an agreement designed to provide customers with increased visibility and control beyond the desktop and into production and external print environments. This relationship extends the capabilities of HP's Managed Print Services division by leveraging Standard Register's proven suite of document services and enterprise software.



• The HP Halo Collaboration Studio delivers tremendous value for enterprise customers who need to connect teams located around the globe. The Halo Video Exchange Network is now available on five continents in 15 countries, while the HP Halo customer base has grown 233 percent since its initial launch late last year. This growth can be attributed to new customer wins such as Canon as well as organic growth from existing customers such as AMD and Novartis. Halo provides a natural, personal experience across distance that enables companies to connect in real time with no perceived delay and is operated with only a few clicks of a mouse.

More information regarding the announcements in this news release is available in an online press kit at http://www.hp.com/go/enterprise2006.

About HP

HP is a technology solutions provider to consumers, businesses and institutions globally. The company’s offerings span IT infrastructure, global services, business and home computing, and imaging and printing. For the four fiscal quarters ended July 31, 2006, HP revenue totaled $90.0 billion. More information about HP (NYSE, Nasdaq: HPQ) is available at http://www.hp.com.

⁽¹⁾ Market opportunity by 2009 based on HP internal research as of October 2006. Retail photo printing - a $7.7 billion market (photo kiosk, photo mini lab and creative output), industrial printing - a $9.8 billion market (light production) and department class, color MFP office printing - a $16.6 billion dollar market. Combined, Edgeline represents more than a $30 billion dollar market opportunity by 2009 for HP.

⁽²⁾ Compared to department color laser MFPs priced below $22,000. Compared to retail photo kiosks with one printer per kiosk, based on fastest rated print speeds of 4 x 6-inch photos. Speeds as published by manufacturers as of August 2006. Test methods vary.

⁽³⁾ For office printing, compared to department-class color laser multifunction products. For retail photo solutions, compared to competitive 4 x 6-inch output of retail photo kiosks with a single printer. Operating costs are the combined price per page of service, repair parts and consumables (exclusive of paper) over a monthly timeframe, based on manufacturers' list pricing as of August 2006. HP office printing costs based on estimated ink prices and preliminary yield. HP photo printing of 4 x 6-inch photos based on list prices and published yield.

⁽⁴⁾ For office printing, compared to department-class color laser multifunction products. Based on independent third-party data, HP testing and internal review of competitive products. For retail photo solutions, compared to competitive 4 x 6-inch output of retail photo kiosks with a single printer. Based on HP testing and internal review of competitive products. Test methods may vary between categories. As of August 2006.

⁽⁵⁾ HP Easy Select Control Panel available in all new small work team and workgroup printers.

⁽⁶⁾ U.S. estimated street prices. Actual prices may vary.

This news release contains forward-looking statements that involve risks, uncertainties and assumptions. If such risks or uncertainties materialize or such assumptions prove incorrect, the results of HP and its consolidated subsidiaries could 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, including but not limited to statements of the plans, strategies and objectives of management for future operations; any statements concerning expected development, performance or market share relating to products and services; anticipated operational and financial results; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. Risks, uncertainties and assumptions include the achievement of expected results and other risks that are described from time to time in HP’s Securities and Exchange Commission reports, including but not limited to the risks described in HP’s Quarterly Report on Form 10-Q for the fiscal quarter ended July 31, 2006, and other reports filed after HP’s Annual Report on Form 10-K for the fiscal year ended Oct. 31, 2005. HP assumes no obligation and does not intend to update these forward-looking statements.

© 2006 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. The only warranties for HP products and services are set forth in the express warranty statements accompanying such products and services. Nothing herein should be construed as constituting an additional warranty. HP shall not be liable for technical or editorial errors or omissions contained herein.