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HP Launches Flexible Pricing Program for Servers

Press release from the issuing company

PALO ALTO, Calif.-July 9, 2001--Hewlett-Packard Company today launched the HP Pay per Use utility pricing program, which allows customers to better align their information technology (IT) costs with revenues as technology use fluctuates over time. With HP Pay per Use pricing, customers can meet unexpected capacity needs and pay for that capacity only when it is used. Customers are billed based on the actual computing power used during any given month, allowing service-oriented companies to bill their end-users in a highly accurate, utility-like manner. The program is available today for customers acquiring UNIX HP Superdome servers and HP's Intel IA-32-based servers. "To be profitable as an application service provider, our strategy is to keep our costs variable instead of moving toward a more capital-intensive model,'' said Tim Daley, director, ASP services at TRW. "HP's utility pricing model fits well within this strategy andhas given TRW and its customers a true advantage. With `pay per use' pricing, we can offer our customers a higher quality solution at lower prices. This new way of approaching the ASP business is a win for everyone along the supply chain.'' "Our customers, especially those in the service provider space, are looking for ways to better manage their cash flows by aligning revenues with IT expenditures accurately, reliably and in a way that maps to their business models,'' said Keith Melbourne, worldwide marketing manager, HP Solutions Organization. "Now, with HP Pay per Use utility pricing, our customers have the computing power they need at their fingertips, but only pay for it when they use it.'' HP's utility infrastructure includes remote management and metering technology, so HP Pay per Use customers receive monthly statements that reflect the average of peaks and down-cycles in usage over a given month. The invoice reflects a base payment and a variable, usage-based payment, similar to the payment structure of a typical cellular phone service. The HP Pay per Use pricing program is available for HP Superdome servers in the United States, the United Kingdom, France, Germany, South Korea, Japan and Singapore. The program also is available for HP's Intel IA-32-based L-series servers in the United States and is expected to be available in the United Kingdom, France, and Germany by the end of this year. HP Pay per Use pricing is already available for printers under the HP Managed Print Services offering and can be arranged for custom-designed infrastructure solutions. HP Utility Pricing Program The exact specifications of HP Pay per Use pricing vary based upon the server model and solution chosen. The HP Pay per Use program complements HP Instant Capacity on Demand (iCOD) and HP Pay per Forecast pricing programs previously introduced. * HP iCOD -- Similar to HP Pay per Use pricing, this option is only upwardly scalable, as servers with additional processor capacity can be activated and purchased or leased as needed. (Now available in the United States and certain countries in Europe and Asia for selected server models.) * HP Pay per Forecast pricing -- This option allows customers to establish a payment schedule that is based on forecast usage, with more flexibility than conventional leasing. (Now available worldwide on all HP business products and solutions.)