Press Release:

HP Introduces Point-of-sale Migration Service for Retailers

New service eases migration to lower-cost, standards-based technologies for customer transactions; Supports Microsoft's Smarter Retailing Initiative
NEW YORK, National Retail Federation Convention & Expo, Jan. 12, 2004

HP (NYSE:HPQ) today expanded its portfolio of offerings for the retail industry with a comprehensive new service aimed at helping retailers migrate from existing, proprietary point-of-sale (POS) platforms to open, industry-standard POS systems

The new service, unveiled today at the National Retail Federation's 93rd Annual Convention & Expo, is designed for implementing standards-based checkout systems, a crucial and customer-facing element in retail operations. The service significantly reduces the total cost of ownership for retailers migrating to the HP rp5000 POS device and other standards-based customer transaction systems. A retailer using this service can have a new POS system up and running quickly.

"HP is substantially expanding its leadership in driving industry-standard IT solutions by enabling many more retailers to take advantage of open standards technology to allow for functional enhancements at retail with a lower operating expense and minimized risk," said Ross Kelly, vice president for retail services, HP Services. "It's our aim to drive higher customer satisfaction and revenue through innovative IT applications without forcing retailers to make an open-ended commitment to a single vendor's product roadmap and cost structure."

The migration service builds off a successful foundation, as retailers worldwide have rapidly adopted HP's open POS platform. More than 40,000 HP rp5000 devices have been committed to retail customers since its introduction in June 2003.

The HP rp5000 is customized to withstand the rigors of the retail environment, offering enhanced peripheral support via powered serial and USB ports, enhanced power and cooling capabilities, and components that combine the functionality of popular proprietary systems with the low price, increased flexibility and manageability of PC-based POS systems.

The introduction of this new service and the rp5000 are examples how HP is implementing its Adaptive Enterprise strategy to improve the ability of customers to respond to and capitalize on change, as well as their return on investment in information technology.

"We are excited that HP will be delivering this new POS migration service that fits in with Microsoft's Smarter Retailing Initiative," said Brian Scott, general manager for the Retail & Hospitality Industry Group, Microsoft. "Clearly, HP is committed to giving retail customers more choices, more flexibility and greater availability of service at a significantly lower cost, resulting in an ideal platform for the development and deployment of retail-specific applications."

HP's POS migration service was designed as an extension of Microsoft's "Quick Start" migration tool, and takes advantage of the widely deployed .NET and Windows® XP Embedded technologies from Microsoft to drive industry standards.

Due to the collaboration between HP and Microsoft, retailers that use the HP rp5000 POS platform will be able to immediately tap new resources Microsoft offers as part of its Smarter Retailing Initiative, a standards-based framework to help retailers to take full advantage of legacy investments by connecting the retail enterprise to the store and to the consumer.

As Microsoft introduces new resources as part of its Smarter Retailing Initiative, retailers that are already using the HP rp5000 POS platform will be able to immediately take advantage of compatible enhancements.

Retailers can purchase the new migration service directly from HP or from any of HP's authorized retail channel partners. HP's 23,000 Microsoft-certified engineers are available to implement the service.

About Microsoft's Smarter Retailing Initiative

The Microsoft Smarter Retailing Initiative helps retailers win today by leveraging current investments, and win tomorrow by easing delivery of new retail experiences. Consisting of Smarter Shopping, Smarter Selling and Smarter Operations, the Smarter Retailing Initiative is designed to close the loop between the retailer's strategy, the in-store execution and familiar technologies already in the consumer's hands. More information can be found at

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

Microsoft and Windows are U.S. registered trademarks of Microsoft Corp.

This news release contains forward-looking statements that involve risks, uncertainties 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; 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.

About HP

HP Inc. creates technology that makes life better for everyone, everywhere. Through our portfolio of printers, PCs, mobile devices, solutions, and services, we engineer experiences that amaze. More information about HP Inc. is available at