HP and Novell Expand Relationship to Offer Linux From Desktop to Datacenter

March 24, 2004

HP and Novell deliver customer choice through multi-OS strategy

PALO ALTO, Calif. and SALT LAKE CITY (BrainShare® 2004)

HP and Novell (Nasdaq: NOVL) today announced a joint agreement to certify and support the Novell® SUSE® LINUX operating system on select HP Compaq client systems. Today's announcement expands HP's multi-OS strategy across servers and PCs, offering customers unprecedented choice to run alternative applications with global support, training and consulting from HP.

The agreement builds upon HP's existing certification of Novell SUSE Linux across HP's industry-standard HP ProLiant and HP Integrity servers, storage, software and services. In 2003, HP was the worldwide leader in revenue and unit shipments for x86 and Itanium Linux servers. According to IDC, HP was the market leader in unit shipments in Q4 2003 for both x86 and Itanium Linux servers, with 27% and 42% share, respectively.(1)

"HP is now the first major technology vendor to offer enterprise customers a single, proven Linux solution from desktop to datacenter," said Martin Fink, vice president of Linux, HP. "Our relationship with Novell is based on a joint commitment to innovation, low-cost platforms, and total customer experience. HP was first to market with Linux-based servers, first to provide a Linux indemnity program for qualified customers, first to reach 2.5 billion in revenue - and the first major technology vendor to certify and support a single, complete, open standards Linux environment."(2)

As part of the joint agreement, Novell SUSE Linux will become HP's standard Linux distribution across its portfolio of business desktop and notebook PCs in North America, with Europe, Middle East, Africa (EMEA) and Asia-Pacific countries at a later date. HP and Novell will also offer product support for Linux-based business PCs and, with certain support contracts, HP will provide qualified customers indemnity against possible litigation from SCO. (2)

"Novell and HP share a rich tradition of innovation and support for the enterprise," said Chris Stone, vice chairman, office of the CEO, Novell. "Novell is working hard to reduce barriers to enterprise adoption of Linux, delivering the security, scalability and reliability for which Novell is historically known, to Linux environments - including the desktop. HP's decision to standardize on SUSE Linux reflects growing industry support for Novell's open platform strategy."

Starting from a modest position in the overall market, IDC's forecast for paid Linux client operating system new license shipments call for a 2002-2007 compound annual growth rate (CAGR) of 25.4%.

"We expect Linux client growth to be led by emerging markets in Asia-Pacific, Latin America and Central Europe," says Al Gillen, research director, System Software at IDC. "Adoption will be less broad in well-established markets due to momentum of the installed base for both operating systems and the applications that are installed aboard those environments. We see an opportunity for Linux client systems, and the package that HP and Novell plan to offer could be an attractive option for users considering a Linux client solution."

HP delivers end-to-end Linux solutions, including servers, storage, software and services on industry-standard platforms. Over the past three years, HP has introduced Linux options for select client systems for business in certain regions and for specific markets and currently sells more than100,000 Linux-based workstations and business desktop PCs per quarter. The company's business notebook, desktop PC, and workstation lineup meets the gamut of business requirements from basic , everyday computing, to more advanced needs for increased power and features for more demanding tasks.

Novell's SUSE Linux is one of the leading commercial Linux distributions worldwide, delivering a powerful option for customers seeking the flexibility, security, and cost savings of Linux, whether at the server or desktop level.

About HP

HP is a technology solutions provider to consumers, businesses and institutions globally. The company's offerings span IT infrastructure, personal computing and access devices, global services and imaging and printing. For the last four fiscal quarters, HP revenue totaled $74.7 billion. More information about HP (NYSE, Nasdaq: HPQ) is available at http://www.hp.com.

About Novell
Novell, Inc. is a leading provider of information solutions that deliver secure identity management (Novell® Nsure™), Web application development (Novell exteNd™) and cross-platform networking services (Novell Nterprise™), all supported by strategic consulting and professional services (Novell NgageSM). Active in the open source community with its Ximian and SUSE Linux brands, Novell is firmly committed to open source and offers comprehensive Linux products and services for the enterprise, from the desktop to the server. Novell's vision of one Net - a world without information boundaries - helps customers realize the value of their information securely and economically. For more information, call Novell's Customer Response Center at (888) 321-4CRC (4272) or visit http://www.novell.com. Press should visit http://www.novell.com/pressroom.

Novell is a registered trademarks; Nsure, exteNd and Nteprise are trademarks; and Ngage is a service mark of Novell, Inc. in the United States and other countries. SUSE is a registered trademark of SUSE Linux AG. * All third-party trademarks are the property of their respective owners.