HP Leads The Home PC Market With Aggressive Price Reductions On Home
Multimedia PCs

HP Broadens HP Pavilion PC Retail Distribution and Sets New Standard For
Delivering Value, Quality and Reliability to Consumers

PALO ALTO, CALIFORNIA. MAY 13, 1996

Furthering its leadership in the consumer PC market, Hewlett-Packard
Company today announced that, effective May 15, it will cut U.S. prices by
up to $200 on its HP Pavilion RealLife Imaging family of PCs, introduced
earlier this year as a new standard for home multimedia computing.

Retail Focus

HP expanded regional distribution this spring to include retailers
Elek-Tek, Fry's Electronics, the good guys!, J&R Computer World, Lechmere
and Nobody Beats the Wiz. The HP Pavilion home multimedia PC line also is
available in leading national retail outlets, including Best Buy, Circuit
City, CompUSA, Computer City, Incredible Universe, MicroCenter, Office
Depot, OfficeMax and Staples. The HP Pavilion home multimedia PC line is
currently sold exclusively in the retail channel.

"We intend to continually offer consumers the best value and leading
technology at the best prices," said Greg Jones, consumer business unit
manager of HP's North American Marketing Center, "We believe aggressive
pricing and expanded distribution, combined with quality products and
stylish design, will keep HP at the top of the consumer PC market."

Increased Market Share and Reduced U.S. Prices

Since entering the consumer PC market in 1995, HP has led the market in
highest average monthly sales growth for consumer PCs at retail and has
climbed from 0 percent market share in July 1995 to its current ranking
among the top five vendors of consumer desktop PCs (CII StoreBoard, March
1996). HP continues to gain market share in the competitive home PC
industry by offering high-quality PCs at prices consumers can afford.

"It is vital in this market for companies to stay ahead of changes in the
price structure," said Joe Ferlazzo, senior analyst at Technology Business
Research in Hampton, N.H. "HP has shown that it understands the dynamics
of the consumer PC market and is willing to do what it takes to capture
market share."

HP        PENTIUM PROCESSOR/RAM/        SPECIAL    NEW        PRICE
PAVILION  HARD DRIVE/FAX-MODEM/CD-ROM   FEATURES   EST.       DROP
MODEL     DRIVE                                    STREET
                                                   PRICE
---------------------------------------------------------------------
5040      120MHz/8MB/1,260MB/                     $1,649     $100
          28.8Kbps/4X

5120      133MHz/8MB/1,260MB/                      1,749      150
          28.8Kbps/4X

7055      120MHz/16MB/1,260MB/                     1,999      200
          28.8Kbps/4X

7110Z     120MHz/16MB/1,260MB/         100 MB      2,149      200
          28.8Kbps/6X               Zip Drive

7125      133MHz/16MB/1,620MB/                     2,299      200
          28.8Kbps/6X

7130P     133MHz/16MB/1,620MB/          Color      2,499      200
          28.8Kbps/6X                   Photo
                                      Scanner

7145      150MHz/16MB/1,620MB/                     2,499      200
          28.8Kbps/6X

7170      166MHZ/16MB/2,000MB/                     2,799      200
          28.8Kbps/6X

Competitive Pricing for Imaging Features
---------------------------------------------------------------------

The RealLife Imaging family of HP Pavilion PCs introduced this February
makes storing and using photographs and other images on the PC easier than
ever. The HP Pavilion PCs offer leading technology and innovative features
including PhotoDrive, a built-in full-color photo scanner, which is
conveniently placed below the CD-ROM drive in the HP Pavilion 7130P
minitower model.

Included with all of the new HP Pavilion PC models is a portfolio of
imaging software such as EasyPhoto by Storm Software and PhotoFinish and
Greeting Card Designer by Softkey. RealLife Imaging lets users personalize
their family computing with multimedia experiences incorporating photos
and other images.

Setting Standards for Value and Reliability

The recent price cuts underscore HP's solid reputation as a provider of
reliable multimedia PCs with excellent value. Recently, the HP Pavilion PC
received the highest scores for reliability and support from PC Magazine
in the home PC category, and PC World ranked HP "best" in all reliability
and service categories in its March issue. The HP Pavilion home multimedia
PC also received the "Family Recommended" award from Family PC this
spring.

Support

HP Pavilion customers receive a one-year in-home limited warranty and
access to HP's toll-free 24-hour, 365-days-per-year phone support. HP's
support number is 1-800-PCHOME1 (724-6631). HP also provides on-line
support services through HP's Support Forum, America Online, CompuServe,
BBS (208-344-1691) and Internet Services.

Hewlett-Packard Company is a leading global manufacturer of computing,
communications and measurement products and services recognized for
excellence in quality and support. HP has 105,200 employees and had
revenue of $31.5 billion in its 1995 fiscal year.

Information about HP and its products can be found on the World Wide Web at
http://www.hp.com/info/pchome1.
 
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