HP Wins Global IT Services Agreement with Nokia; Fixed IT Environment to be Transformed into Scalable, Risk-free Infrastructure

Business Wire, Sept 25, 2001

Business Editors/High-Tech Writers

PALO ALTO, Calif.--(BUSINESS WIRE)--Sept. 25, 2001

Hewlett-Packard Company (NYSE:HWP) today announced that it has been selected by Nokia Corporation (NYSE:NOK) to manage several of Nokia's business-critical IT services. HP will focus on transforming Nokia's fixed IT environment to a flexible, scalable infrastructure, improving service performance while minimizing recurring fixed costs. The agreement, valued at $185 million over a three-year term, was signed today and is expected to commence on Nov. 1.

Under the terms of the agreement, HP Services will run and manage Nokia's business infrastructure operation centers in Finland, the United States, China and Singapore. HP Services will manage Lotus(R) Notes groupware, Microsoft(TM) Exchange messaging and file print and sharing services for Nokia's 60,000 global users. HP will assume responsibilities for supporting these services and 3,000 servers in seven operation centers worldwide. Approximately 260 Nokia IT employees will become HP employees as a result of the agreement.

HP's outsourcing approach minimizes Nokia's financial risks in IT services by defining specific cost-savings targets and jointly sharing any savings over and above the target. 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.

"This outsourcing agreement is a mutual win for HP and Nokia," said Ann Livermore, president, HP Services. "Nokia will benefit from HP Services' proven expertise in managing complex, global IT infrastructures, and HP will inherit a solid Nokia IT team that will continue to provide excellent levels of service to Nokia."

"We are pleased to be working with a global service provider of the caliber of HP. It is a natural fit, not only in terms of competence but also values and culture," said Mikko Kosonen, senior vice president, Nokia Strategy and Information Management. "The deal, which will bring significant annual cost savings through economies of scale, is part of Nokia's on-going strategy of building on core skills, while teaming up with good global partners."

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.

Note to Editors: 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.