HP and Microsoft Simplify Technology Environments with Solutions Built on New Infrastructure-to-application Model

World’s largest technology company and No. 1 software provider plan to advance cloud computing with industry’s most integrated technology stack

PALO ALTO, Calif., HP and Microsoft Corp. today announced a three-year agreement to invest $250 million to significantly simplify technology environments for businesses of all sizes.

The companies plan to deliver new solutions that will:

* be built on a next-generation infrastructure-to-application model;
* advance cloud computing by speeding application implementation; and
* eliminate complexities of IT management and automate existing manual processes to lower the overall costs.

This agreement represents the industry’s most comprehensive technology stack integration to date – from infrastructure to application – and is intended to substantially improve the customer experience for developing, deploying and managing IT environments.

With this strategic partnership, HP and Microsoft will collaborate on an engineering roadmap for data management machines; converged, prepackaged application solutions; comprehensive virtualization offerings; and integrated management tools. Delivered through the industry’s most extensive sales and partner network, these dynamic IT solutions will provide:

* Increased business efficiency through solutions that respond to changing business requirements by seamlessly converging server, storage, network and application resources in a highly automated, self-managed environment.
* Improved application performance, reliability and availability for some of the industry’s top business applications, including Microsoft Exchange Server and Microsoft SQL Server, by creating a deeply optimized “machine” environment. This is achieved through turnkey, pre-integrated server, storage, networking and application packages. These data management and email machines provide “push button” simplicity in deployment and management.
* Enhanced operations through integrated, interoperable virtualization and management tools that allow technology environments to be automatically provisioned, managed and continuously self-tuned. Through the integration of HP Insight Software, HP Business Technology Optimization software and Microsoft System Center, enterprise customers use a unified management solution to automate application deployment along with infrastructure-to-application monitoring. This integration also delivers power and performance optimization, while ensuring interoperability in a heterogeneous data center environment.
* Investment protection and low total cost of ownership, enabling customers to deploy systems with confidence. The joint solutions are built on industry standards and designed to utilize existing data center investments, all managed through a common framework. This approach is designed to enable customers to integrate private or public cloud computing models as their business requires. HP and Microsoft will collaborate on the Windows Azure platform, with HP and Microsoft offering services, and Microsoft continuing to invest in HP hardware for Windows Azure infrastructure.

“Driving innovation helps businesses establish a competitive advantage,” said Mark Hurd, HP chairman and chief executive officer. “This collaboration will allow HP and Microsoft to offer our customers transformative technology that will reduce costs, generate business growth and accelerate innovation.”

The new infrastructure-to-application model from HP and Microsoft will be delivered as integrated offerings for large, heterogeneous data center environments as well as through solutions designed for small and midsize businesses. Solutions are available immediately, with new offerings being introduced throughout the next three years.

“This agreement, which spans hardware, software and services, will enable business customers to optimize performance with push-button simplicity at the lowest-possible total cost of ownership,” said Steve Ballmer, chief executive officer, Microsoft Corp. “Our extended partnership will transform the way large enterprises deliver services to their customers, and help smaller organizations adopt IT to grow their businesses. Microsoft and HP are betting on each other so our customers don’t have to gamble on IT.”

Driving opportunity for HP and Microsoft Frontline channel partners worldwide

Under the terms of the expanded partnership, the two companies will increase their global investment by 10 times to drive new opportunities for the 32,000 HP and Microsoft Frontline channel partners. Partners will support customers in modernizing their environments through a combination of software and hardware infrastructure-to-application packages and services. Partner benefits include:

* Quicker time to revenue with simplified and shortened sales cycles resulting from Smart Bundles and all-inclusive packages as well as new offerings that provide add-on application and service sales opportunities.
* Flexible financing options through HP Financial Services, which will enable resellers to drive customer adoption by making technology solutions more accessible and easy to acquire.
* Increased support with dedicated field resources focused on presales initiatives and extensive partner training.
* Jointly funded worldwide marketing campaigns, lead-generation programs and sales tools, available at www.hpmspartners.com.

Driving customer success with HP professional services and Microsoft Services

To speed return on investment (ROI) and increase business value, the integrated portfolio is complemented by new design, implementation and support services for the joint solutions. Through more than 11,000 Microsoft-certified HP professionals worldwide, HP Services, in partnership with Microsoft Services, will support the entire integrated hardware and software solution from simple implementations to the most critical enterprise infrastructure. Service offerings include:

* Strategy workshops, ROI and business value services. Other available services include architecture, design, pilot, global implementation, support for server virtualization and management solutions, client virtualization, data management and cloud computing as well as per-seat fixed-price Microsoft Exchange Server upgrade/migration services.
* Application modernization services for large-scale online transaction processing (OLTP) implementations.
* Planned customized Business Intelligence Solutions that provide faster time to application value.
* Assistance for customers who seek to run their technology on-premises, outsourced or via the cloud.

More information about the HP and Microsoft agreement is available at www.hp.com/go/microsoft/infra2apps.

Microsoft and HP executives will discuss this announcement during a public audio teleconference today at 11:15 a.m. ET. Interested parties can listen to the audio teleconference by visiting http://hpbroadband.com/program.aspx?key=SKPNSKDIKG. Interested parties can participate in the audio teleconference by calling +1 800 369 1191 (U.S., toll-free) or +1 212 519 0829 (international, toll). The passcode is 3022632.

The teleconference replay and other media materials are available at www.microsoft.com/presspass/presskits/infrastructure/ and www.hp.com/go/HPMSFTalliance.

About Microsoft

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

About HP

HP creates new possibilities for technology to have a meaningful impact on people, businesses, governments and society. The world’s largest technology company, HP brings together a portfolio that spans printing, personal computing, software, services and IT infrastructure to solve customer problems. More information about HP (NYSE: HPQ) is available at http://www.hp.com/.

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