Press Release:

HP Extends Global IT Services Agreement with Nokia in Europe

HP and Nokia Move Forward to Transform Fixed IT Environment Into Scalable, Risk-free Infrastructure

GENEVA, Jan. 16, 2002

Hewlett-Packard Company (NYSE:HWP) today announced an extension to its IT services agreement with Nokia in Europe. The relationship, first announced in September 2001, will see HP focusing on transforming areas of Nokia's fixed IT environment to a flexible, scalable infrastructure, improving service performance while minimizing recurring fixed costs across an additional 30 countries in Europe.

Today's announcement extends the arrangement to an additional $75 million in services as well as 82 more people to be reassigned as a result of the outsourcing. This brings the total number of worldwide Nokia IT employees transferring to HP to 342 and the total value of the agreement to $260 million over three years.

Under the terms of the extended agreement, HP Services will run and manage Nokia's business infrastructure operation centers in 30 countries across Europe, in addition to those in Finland, the United States, China and Singapore. HP Services will manage Lotus® Notes groupware, Microsoftä Exchange messaging and file print and sharing services for Nokia's 60,000 global users. HP will assume responsibilities for supporting these services and 4,000 servers to over seven operation centers worldwide.

The deal confirms HP's on-going strategy and capability to deliver its outsourcing services by managing complex, global IT infrastructures. By defining specific cost-savings targets and jointly sharing any savings over and above the target, HP's outsourcing solution will continue to help minimize Nokia's financial risks in IT services. Continuing cost reduction benefits to Nokia are expected to be approximately 25 percent over the three-year term. This is the largest IT outsourcing agreement that Nokia has signed to date in Europe.

"The extension of this outsourcing agreement is based on the success of the HP and Nokia agreement," said Carlo Magistrelli, general manager, HP Outsourcing Services, EMEA. "Nokia will continue to benefit from significant outsourcing cost reductions across Europe with HP Services' expertise in managing global IT infrastructure, and HP will gain a professional and culturally diverse Nokia IT team."

"It was only natural that our relationship would extend to Europe, said Jorma Hietala, director, Nokia IM Areas. "We look forward to continued significant annual cost savings and increased efficiencies across our IT business infrastructure, benefiting from HP's proven expertise and strong global networks."

About HP

Hewlett-Packard Company -- a leading global provider of computing and imaging solutions and services -- is focused on making technology and its benefits accessible to all. HP had total revenue of $45.2 billion in its 2001 fiscal year. Information about HP and its products can be found on the World Wide Web at

Lotus is a registered trademark of Lotus Development Corporation.

Microsoft is a U.S. registered trademark of Microsoft Corp.

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 products, 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 products and services and their feature sets; the challenge of managing asset levels, including inventory; the flow of products into third-party distribution channels; 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 Securities and Exchange Commission reports, including but not limited to the annual report on Form 10-K for the year ended Oct. 31, 2000, and subsequently filed reports. 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