Compaq Colors the Palm-Size PC Market with Industry-Leading Reflective TFT Display.

HOUSTON--(BUSINESS WIRE)--March 1, 1999--

New Compaq Aero 2100 Sets the Standard for Color Palm-size PC 

Usability with Rich Connectivity, Long Battery Life

and Compelling Audio Features

Compaq Computer Corporation (NYSE:CPQ) today unveiled the Compaq Aero(R) 2100 Color Palm-size PC, the company's first entry into the growing Palm-size PC market. The Compaq Aero 2100 is the industry's first shipping Palm-size PC with a reflective color thin film transistor (TFT) display that is easy to read in any environment.

"Compaq will become the industry leader in PC companion devices by offering better answers to customer needs with a complete range of outstanding products built for professionals and businesses," said J. Tempesta, Vice President and General Manager, Enhancements and Monitors Division, Compaq Computer Corporation.

Innovative features such as a reflective color TFT screen, rechargeable Lithium-Ion (Li-Ion) batteries with up to 10 hours of continuous use, and compelling Internet audio content download and playback make the Compaq Aero 2100 an unbeatable Palm-size PC solution. The Compaq Aero 2100 is a much needed extension to both networks and PCs, ensuring access to and synchronization with critical information whether you're in the office or at a remote location.

"Compaq is a highly recognizable and credible brand name in the computer industry, and now they are bringing this expertise to the Palm-size computing platform," said Harel Kodesh, Vice President, Information Applications Division, Microsoft Corporation. "Compaq has taken advantage of the core functionality of Windows CE and developed hardware that supports customers' desire for easy-to-read color screens, compelling audio playback and compact flash expandability that enables the addition of powerful storage and third-party options to the device."

Available with 8- or 16-megabytes (MB) of memory, the Compaq Aero 2100 product's crisp, clear color display uses reflective technology, which reflects light from available sources off the back of the display to show information on the screen, making the unit as easy to read outdoors as it is indoors. Two light modes allow for easy viewing in even the darkest of rooms. Not only is the screen 44 percent larger than that of the 3Com Palm Connected Organizers, but it delivers 256 colors at 240-by-320 pixels, versus 3Com Palm Connected Organizers at 160-by-160 pixels on a black and white display.

Today also marks the introduction of the Aero sub-brand for all Compaq PC companion products. Beginning with the Compaq Aero 2100, all subsequent PC companion products from Compaq will use the "Aero" name to identify and differentiate these ultra mobile companion products from other mobile products.

"The need to access critical information such as one's contact list, calendar and e-mail represents strong market drivers for the growth of the handheld industry," said Diana Hwang, Research Manager, International Data Corporation, a market research firm based in Framingham, Mass. The overall handheld companion market will grow to over 14.1 million units worldwide by 2002. The Palm-size PC market is expected to capture nearly 40 percent of that market during the same time period.

The Ideal Personal Productivity Tool for PC Users on the Go

The Compaq Aero 2100 is designed for mobile professionals who need access to critical scheduling and contact information any time, any place. It synchronizes seamlessly with a customer's Windows-based primary PC, and through rechargeable Li-Ion batteries, achieves battery life of up to 10 hours(1) during normal use (equivalent to more than two weeks of usage in typical scenarios).

Potential Compaq Aero 2100 users are looking for a personal productivity tool to manage information such as calendar and contact lists in a device that fits into a shirt pocket. Other customers will include managers of business information systems who want to deploy Palm-size PCs in their corporations as a sales force or field service automation tool and productivity solution. A third market includes users looking for a small, lightweight device for data collection and forms-based applications in mobile industries such as home health care and delivery services.

Compaq Aero 2100 Key Features

-- Easy-To-Use Design

At just 5.27 inches tall, 3.34 inches wide, .78 inches deep (13.4cm x 8.5cm x 2cm) and weighing only 10.92 ounces (260 grams) the Compaq Aero 2100 is small enough to fit in a shirt or coat pocket, a briefcase or a purse. This sleek, matte silver Palm-size PC fits comfortably into the user's hand, and is designed to be intuitive and easy to use.

A dial on the side of the unit allows for one-handed scrolling and execution of actions, similar to the way a mouse is used on a desktop PC. The touch-sensitive display can accept input from the stylus or a fingertip, and an integrated mechanism holds the stylus securely in place, minimizing the risk of inadvertently losing the stylus. By simply pressing on the top of the stylus -- much like a click pen -- the stylus is released.

Three different frontlight settings are available to the user: the standard setting (no illumination), low frontlight and high frontlight. Three alarm settings -- audible "chirp," vibration, and silent LED -- are also available to the user. Finally, customizable application launch buttons can be set to the user's preferences.

-- New Lithium-Ion Battery Technology Offers Long Life, Recharging

on the Go

A long-lasting new Li-Ion battery for the Compaq Aero 2100 offers up to 10 hours of battery life for optimum mobile productivity on the road. When the Compaq Aero 2100 is docked in its cradle (standard with all models) to synchronize to the desktop or portable PC, its Li-Ion battery is automatically charged. An additional battery can be charged in the optional Deluxe Cradle (standard on some models). The standard AC adapter is also useful while travelling as it recharges the battery when plugged into a standard power outlet.

-- Audio Capabilities Turn the Compaq Aero 2100 Into an Audio

Information and Entertainment Device

Compaq Aero 2100 users can download free AudiblePlayer software from www.audible.com/compaq and turn the unit into an Internet audio player that can access Audible.com's 17,000 hours of premium spoken audio programming. Audible.com is the one-stop shopping site for purchase and automated delivery of the world's best audio. Features include "The New York Times Audio Digest on Audible" and "The Wall Street Journal on Audible," The Economist and Harvard Business Review on Audible, as well as thousands of best-selling and classic audio books, audio magazines, on-demand radio (including Marketplace, Nightly Business Report, Fresh Air and Car Talk), speeches, lectures and language learning. Audible.com offers the broadest range of audio available from one source.

Audio can simply be played back on the Compaq Aero 2100 through the headphones connected to the audio jack, through the integrated speaker or through any car stereo system using an audiocassette converter. The Compaq Aero 2100 can be easily programmed to play several hours of Audible audio.

"The Audible.com listening experience on the Compaq Aero 2100 offers unparalleled value for today's mobile executive," stated Andy Huffman, President and CEO of Audible Inc. "Audible's unique audio services allow Aero 2100 users to program their own listening time and make productive use of commutes and travel times by delivering need-to-know information and quality entertainment when and where customers want it."

An instant record button allows for convenient and quick voice notation by pressing a single button. "Voice notes" help eliminate the endless stream of handwritten notes frequently employed by Palm-size PC users. The user can also make a high-fidelity recording by plugging an external microphone through the audio jack.

-- Windows CE for Color Palm-size PCs

The Compaq Aero 2100 uses the new Microsoft Windows CE operating system for Color Palm-size PCs. The familiar user interface of Microsoft Windows allows customers to utilize PC companion devices immediately and offers seamless integration with desktop PCs. Users can customize settings to suit the way they work, and may select what information is displayed on the opening screen when the unit is turned on. Additionally, a security password can be set to protect the user's valuable data. Memory, power and audio usage can be controlled through the software as well.

Pocket Outlook applications including Calendar, Contacts and Tasks keep track of the user's most critical personal information and schedule changes. Other applications include Priority and Reminder functions, Voice Recorder, Note Taker, Calculator, Mobile Channel, Desktop Connectivity, and Backup and Restore. Backend integration allows for the Compaq Aero 2100 to be used in enterprise solutions through Exchange, Citrix, and other database and vertical applications.

-- Compact Flash Memory Cards Enhance Operability 

The Compaq Aero 2100 provides for expansion solutions through an industry-standard compact flash memory card slot, which provides nearly unlimited expandability. Compact flash (CF) expansion cards allow compatibility with many modem, storage, local area network (LAN), I/O cards (serial and parallel port), and bar coding PC cards, providing greater capabilities and improved functionality.

In addition, the Compaq Aero 2100 compact flash memory expansion slot is designed to support future wireless communications options.

-- Software Bundle Adds Even More Variety and Convenience

Compaq is bundling additional applications with some models of the new Compaq Aero 2100 (see Compaq Aero 2100 Fact Sheet for more details). Such titles include:

-- Audible Content Player(TM)

-- Compaq Asset Viewer software

-- Picture Viewer

-- Compact Flash Memory Backup and Restore

-- Applian Technologies, Inc. CoolCalc

-- VCA, Inc. Expense Tracker

Models, Options and Availability

With prices beginning at $449(2), the Compaq Aero 2100 will begin shipping to North American Authorized Compaq Channel Partners this week; products will be available at select North American Authorized Compaq Retail locations by the end of the month.

In addition, the Compaq Aero 2100 will be available directly through Compaq DirectPlus at www.directplus.compaq.com or at 1-800-888-5858. DirectPlus allows small businesses to purchase competitively priced Compaq PCs and popular software applications direct from Compaq. Product shipments will begin in Europe, the Middle East, Africa, Latin America and Japan in the second quarter.

The Compaq Aero 2100 comes in three model configurations with different memory and accessories; the first model features 8 megabytes (MB) of memory and a Standard Cradle for $449. The second model includes 16MB of memory, a Standard Cradle and an application software CD for $499. The third model includes 16MB of memory, a Deluxe Carrying Case, an extra Li-Ion battery, an application software CD and a Deluxe Cradle for $549.

A full range of options is offered to complement the Compaq Aero 2100 color Palm-size PC, including:

-- Deluxe Cradle (with battery charger to charge second battery)

for fast and simple connectivity to the PC

-- Additional Li-Ion batteries

-- 24MB Memory Expansion Modules to increase storage space

-- Compact flash memory cards to expand functionality and improve

mobile productivity:

-- Compaq 56K Modem, 20MB and 40MB Storage

-- 3rd Party LAN, I/O (serial and parallel) and Barcode

Scanner

-- Three Carrying Cases (Slipcase, Deluxe Case, Executive

Portfolio Case)

-- Auto-Sync Cable, which can be used on the road for connecting

to portables or for synchronizing to a second PC at the office

or home

-- Stylus 3-pack

-- Automobile Adapter

Service and Support

The Compaq Aero 2100 is protected under Compaq's generous support umbrella known as CompaqCare. The service and support package includes:

-- Mail-in warranty, which limits customer cost, downtime and

inconvenience by sending a new or 'like new' replacement

Compaq Aero 2100 within five days of when the product is

received from the user (North America and Canada only)

-- Round-the-clock support provided by 24 x 7 technical support

hotline

-- Online support forums on Prodigy, CompuServe, America Online

and the Internet

Company Background

Compaq Computer Corporation, a Fortune Global 100 company, is the second largest computer company in the world and the largest global supplier of computer systems. Compaq develops and markets hardware, software, solutions and services, including industry-leading enterprise computing solutions, fault-tolerant business-critical solutions, enterprise and network storage products, commercial desktop and portable products and consumer PCs. The company is an industry leader in environmentally friendly programs and business practices.

Compaq products are sold and supported in more than 100 countries through a network of authorized Compaq marketing partners. Customer support and information about Compaq and its products are available at http://www.compaq.com, or by calling 1-800-OK-COMPAQ. Product information and reseller locations are available by calling 1-800-345-1518.

Compaq, Prosignia, Registered U.S. Patent and Trademark Office. Product names mentioned herein may be trademarks and/or registered trademarks of their respective companies.

(1) Actual results will vary with individual usage.

(2) All prices listed herein are estimated U.S. selling prices.

Actual reseller prices may vary.