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HP Launches Flexible Pricing Program for Servers

HP Pay per Use Pricing Aligns Customer IT Costs with Revenues for Better Cash Flow

Hewlett-Packard Company (NYSE:HWP) 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 and has 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.)

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 from continuing operations of $48.8 billion in its 2000 fiscal year. Information about HP and its products can be found on the World Wide Web at http://www.hp.com.


UNIX is a registered trademark of the Open Group.

Intel is a U.S. registered trademark of Intel 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 of these products and services may not proceed as planned; 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. 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 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 http://www.hp.com.