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Senior Vice President and General Manager Europe, Middle East and Africa

December 6-9, 1998. Andreas Barth. Senior Vice President and General Manager Europe, Middle East and Africa Compaq Computer Corporation. Navigating the Future Together. 1998 Telecomm Forum. (name of presenter, company). 1. 32. Revenues in B$. 24.8. 18.1. 14.8. 10.8. 7.2. 4.1. 3.6.

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Senior Vice President and General Manager Europe, Middle East and Africa

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  1. December 6-9, 1998 Andreas Barth Senior Vice President and General Manager Europe, Middle East and Africa Compaq Computer Corporation Navigating the Future Together 1998 Telecomm Forum (name of presenter, company) 1

  2. 32 Revenues in B$ 24.8 18.1 14.8 10.8 7.2 4.1 3.6 3.3 2.9 1.9 1.2 0.6 0.5 0.3 0.1 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 Compaq History and Milestones 1982 Founded in Houston, Texas 1984 International HQ in Munich 1987 Manufacturing in Scotland 1991 The New Era (Eckhard Pfeiffer) 1994 #1 PC company worldwide 1996 New objective: Top 3 Computer Company 1997 Acquired Tandem 1998 Acquired Digital 2000 The Best Enterprise Computing Company (name of presenter, company)

  3. Extensive Compaq Resources 85,000 People 3 Distribution Centres 57 Subsidiaries 10 Factories 140 Countries Sophia Antipolis Telecom Competency Centre 8,000 Sales Reps 20+ Million Potential Customers Competency Centres World Wide 400 Telecom Sales & Support in EMEA 2,000 ISV/Solutions Partners 29,000 Service Professionals 600 NSIS Project Delivery Personnel in EMEA 15,000 Channel Partners (name of presenter, company)

  4. From a PC to an Enterprise Driven Company PCs, Servers, Multi-user Storage Non-Stop Computing, Windows NT Solutions Products, Services and Solutions from Palmtop to Data Centre (name of presenter, company)

  5. Western Europe Market Share % Unit Share 18.5% (name of presenter, company)

  6. Future Developments VI Architecture Largest NT Cluster TPC Fibre-Channel Microsoft Clustered Server* Billion transactions per day* Redundant Fans* PCI Hot Plug* Online Recovery Server * 4 GB memory Storage Capacity 500 GB* Standby Recovery Server 10/100 NIC Redundant Power Supplies* 1 GB memoryServer optimized PCI ECC Memory Hot pluggable drives Standard Server Management* Automatic Server Recovery* Remote hardware management software Pre-failure Warranty 92 93 94 95 96 97 98 99 Compaq Drives Server Innovation Development Within Industry Standards (name of presenter, company)

  7. OpenVMS • Compaq - Microsoft Alliance • Compaq is the Number 1 NT company • Over 3,000 trained, certified NT professionals, more than all competitors combined • NT 38% • MS Exchange 70% • #1 in Exchange Migration with 3 Million seats world-wide • Incorporate NonStop, Open VMS and Digital UNIX capabilities into WNT • Make Compaq’s Digital UNIX..most WNT friendly UNIX -The System: Looks & feels like NT, performs like UNIX. (name of presenter, company)

  8. Relative Performance: Integer (SPECint95-peak) 220 210 EV8 • Alpha remains clear 64-bit choice as lead over Merced extended • 64-bit capability on Windows NT over 2 years before other vendors get their first 64-bit processors 200 190 180 170 160 150 140 130 120 110 SPECint95peak EV7 100 90 80 EV68 70 21264 .25u 60 50 40 30 IA-64 20 21264 (Merced) 600 MHz 10 21164 0 600MHz 1995 1998 1999 2000 2001 2002 Alpha Roadmap • Most powerful UNIX system • Supports over 104,000 concurrent users • Almost 2X best performance of IBM, HP Sun

  9. Compaq StorageWorks makes the difference for Telecommunications Partner with the Leader 1. #1 Storage Supplier 22% worldwide open market (IDC) 2. Single Architecture - Heterogeneous Platform and OS - Desktop to Datacentre 3. Network Storage “...the most developed SAN exploitation strategy we have seen to date.” Gartner Oct 98 4. Simplified Management - Centralized Management View - Physically Distributed Resources - Modular, Scaleable Building Blocks 5. Investment Protection Bridging Solutions eliminate technological obsolescence

  10. OVMS 400 engineers /500 consultants Over 450,000 systems installed Over 10 million users >50% of cell phones billed Makes 90% of all CPU chips 75% of stock exchanges (OVMS and Himalaya) &Dominance in lottery Investment: • R&D approx. $100 M/year • October Galaxy Announcement OpenVMS Compaq and Digital UNIX & OVMS Digital UNIX Applications Available: • Over 5,600 64-bit applications Resources: • 3000 Engineers world wide • $300M worth of Development (Digital UNIX and Alpha) Digital UNIX ISV Partnerships: • ISV ports grown >1,000 year/97 • New applications 15/week (name of presenter, company)

  11. Compaq and NonStop Computing • 850 Customers Including: • Ericsson, Cellnet, Rabobank, Hungarian Telephone, SIA, Merita, Peugeot/Citroen, Deutsche Telecom, Telekurs, Daimler Benz, Quelle, ING Bank, Tele Danmark, Natwest, CrestCo • 1200 Sites, 36% of High Availability Market: • Consistent support throughout Europe • 50% of the cell phone billing • 2800 NSK Systems • 200 Partners including: • Banksys, CAP Gemini, Globeset, WM-DATA, MPACT-IMMEDIA, TATA, LOGICA, SBF - Bourse de Paris, ACI, MPCT, Deluxe, VICORP, CA • Application Types: • Financial Services, Telecommunications, Decision Support, e-Commerce • Investment: • R&D approx. $250 M/year • Alpha Chip on Himalaya (name of presenter, company)

  12. Customer Services Network & System Integration Services Operations Management Services • Vertical Solutions • Telecom • Finance • Horizontal Solutions- • NT Infrastructure • NT Related- mail, SQL Server, Internet • UNIX Integration • Business Critical • Telecom Specific: custom projects, Software Development, project management and delivery, Network Integration Resources: • 3300 employees • Clients/Servers • OVMS/VAX Support • NSK Support • UNIX Support • Packaged Services • CarePaqs • Business Critical • Year 2000/Euro • Software • Telecom Specific: Business Critical Support, Procurement & Test, Warranty Resources: • 7600 employees • Outsourcing • Customer Helpdesks • Enterprise • Infrastructure mgmt • Internet/Intranet • Telecom Specific: “follow-the-sun” services, operation & support management, Network Management, Implementation Resources: • 1100 employees Compaq Services EMEA (name of presenter, company)

  13. Communications Industry Requirements • Scaleability • High-Reliability • Customization • New Services • Partnerships (name of presenter, company)

  14. Scaleability: Bouygues Telecom • Scenario: Bouygues - one of the fastest growing GSM/DCS service providers in EMEA Users 100,000 users in 1995 250,000 users in 1996 500,000 users in 1997 >1 Million users in 1998 • IT Requirement: Scaleable Platform for business-critical applications • Customer Care and Billing with LHS and CAP Gemini • TeMIP and Call Center with SEMA as Prime Contractor • Prepaid card with ORGA and CAP Gemini • Voice Platforms with ATOS (name of presenter, company)

  15. Scaleability: Bouygues Telecom Users Equipment 100,000 users in 1995 1 Billing, 1 Rating & 1 Backup machine 2 CPU/2GM memory each 250,000 users in 1996 + 2 CPUs, 2GB memory for each 500,000 users in 1997 + 8 CPUs, 6GB memory (Billing/Backup) >1 Million users in 1998 + 2 Machines with new technology • Compaq’s Value Proposition: • Scaleable Alpha Architecture: • Compaq’s Commitment: • Offered “Performance Commitment”- after analysis of customer needs and specific software performance, design a global solution and provide the add-ons free, if service level agreement is not reached (name of presenter, company)

  16. High Reliability: Nokia • Scenario: Nokia ships worldwide high-performance service nodes which provide wireless operators with revenue-generating enhanced services capabilities. • Equipment supports over 1300 concurrent users world wide daily with 24/7 support. • IT Requirement: 24x7 Support of Nokia’s DX200 switch software • Existing architecture based on Clustering + AlphaServerIP solution with OVMS to provide 99.985% reliability (NSIS Data) • Compaq’s Value Proposition: Business Critical Services for 24x7 support world wide of Digital Vax cluster, AlphaServer platforms • Compaq’s Commitment: 24x7 guaranteed support, service level agreement, longevity of equipment- Nokia has been running these for 10 years (name of presenter, company)

  17. High Reliability Fault-Tolerant Solution: TeleDanmark • Scenario: Hardware and Software Support for mission-critical applications • Call Detail Record Collection • Directory Assistance • Network Monitoring and Control • Intelligent Networking • IT Requirement: • Scalaeble Fault-Tolerant platforms • Ability to interface with multiple applications • Compaq’s Value Proposition: • Himalaya Fault-Tolerant systems • Openness of platform • Ability to grow with business by adding CPUs in ”live mode” • Ability to deploy custom services- i.e. location sensitive billing services • Compaq’s Commitments: • Never-fail operations at 99.9997% (name of presenter, company)

  18. Customization: Deutsche Telekom • Scenario: Providing a turn-key solution including planning, hardware, software, integration, testing for a high-performance, robust Intelligent Network. • Service Control Point provided by Alcatel • Service Management System provided by Compaq • IT Requirement: Service Management System • Extension of customer capacity from 160K to 220K (40%) Intelligent Network numbers/customers • Providing complete replication of the whole DTAG IN system for disaster tolerance • Always providing enhancements based on customer requirements: e.g. a 1998 service was to provide free-phone service scaleable from Germany-wide to city-wide (name of presenter, company)

  19. Customization: Deutsche Telekom • Compaq’s Value Proposition: • Working relationship with Alcatel-SEL • Custom Project Delivery Capability through NSIS including: project management, systems integration, software development, 35 People • Alpha Architecture excellence - gives customer scaleability and the possibility to extend system in various ways not offered by competition’s hardware • Compaq’s Commitments: • Performance guarantees have been met- number of customers, capacity, access points • On-time delivery for all 7 phases of solution • 7 Year project lifecycle management • Introducing Internet access (name of presenter, company)

  20. Customization: British Telecom • Scenario (Cambridge Project): • New generation Intelligent Network allowing the rapid deployment of new services in a timely/cost-effective manner • Launch of Virtual Call Center services • BT provides marketing information about the caller: name, address, location, time of call • IT Requirements: • System Integration including 3rd Party software and hardware • First time BT deployed standard IT equipment into its core telephony network (name of presenter, company)

  21. Customization: British Telecom • Compaq’s Value Proposition: • NSIS services including: project management, systems integration, custom software development, end-to-end testing, break-fix, Business Critical Solution Support • Alpha and Intel Servers Running NT • Applications from partners GeoTel and Amarex Corp • Rapid development of SS7 Interface • Compaq’s Commitments: • Delivery on time- Project took under 2 years • SS7 interface development took 6 months • 35 Engineers and Product Managers for development • 20 Hardware engineers for configuration & implementation (name of presenter, company)

  22. New Services Deployment: TelePost • TelePost- Founded in December 1996 with seed financing from Telenor. Purpose is to Exploit the market for Web-centric messaging, collaboration and computer telephony. • Established European & US operations • 75 employees & consultants • Scenario: Rapid implementation of service nodes in 65 countries within 18 months that provide functionality to TelePost’s ISP customers. • Ability to quickly add host of new services to existing suite • Web-based conference calling • Unified messaging • Ring-me-now/follow-me-now • On-line presentation center • IT Requirement: • Build, deploy and manage the world wide network of service nodes (name of presenter, company)

  23. New Services Deployment: Telepost • Compaq’s Value Proposition: • Compaq owns & operates all world wide nodes • Customer Services providing: procurement and testing, installation of platforms, warranty • OMS services including: follow-the-sun service, program & implementation management, network management, operations and support • Compaq’s Commitments: • Delivery on time, world wide • Starting in Norway, Denmark & UK • Currently Implementing: 9 Nodes in 6 Additional locations in 4 countries (name of presenter, company)

  24. New Services Deployment5 GSM Operators • Scenario:Launch new value-added services based on voice-activated user interfaces, i.e. personal call-routing profiles, voice mail retrievals • IT Requirement: • Cost-effective, industry standard based IT platforms which can scale from low entry levels (50 concurrent ports) to high usage (500-1000 concurrent ports) • Concept: based on an automated personal assistant • Rapid deployment in competitive markets • Compaq’s Value Proposition: • Exclusive Partnership with Wildfire application software • Clusters of Intel servers running NT • Cost-effective deployment • Compaq’s Commitments: • Pricing based on subscriber take-up and traffic usage • Scaleability (name of presenter, company)

  25. Partnership: BT Intranet • Scenario (BT Intranet Complete) • Launch throughout EMEA Virtual Private Intranet Services • BT’s customers offered self-build and managed ISP services • Packaged Intranet solutions based on AltaVista & other partner apps • Remotely managed ISP services • IT Requirements: • Service-Ready Infrastructure in many countries & Intranet qualifications • Compaq’s Value Proposition: • Industry Standard Intel Servers • S.I. Project Management and Technical Consultancy • Remotely managed server farms • Compaq’s Commitments: • No other IT Vendor could offer the full range of products and services for Intranet technology • Certified service personnel (name of presenter, company)

  26. Go To Market Model Consumers Global and Major Accounts SMB Channel - Distributors - VARs and Resellers - System Integrators - System Resellers Compaq Major Accounts Retailers Global Accounts Major Accounts Product Sales Specialists Service Sales Specialists Compaq Call Centers Compaq Channel Sales e - Commerce (name of presenter, company)

  27. Global Accounts • Compaq has 150 Global Accounts – 80 EMEA-based • Purchase Volume $20M annually • Purchasing > 2 Geographies • New Global Account Organization World Wide & Geo level • Empowered EMEA Global Account Managers • Accountable / team management at World Wide level • Very senior 15 years+ experience • Consistent world wide pricing structure • Coherent world wide product & service offering • Special availability terms (name of presenter, company)

  28. Compaq Telecom Market Position EMEA • Sophia Antipolis Solution Centre • 32 Business Development, Marketing and Pre-Sales • 30 NSIS Professionals • 8 Customer Services Professionals doing Business-Critical services • 120 Software Engineering • Telecom Sales and Sales Support in Countries • 400 approx. • NSIS • 600 project delivery Personnel Compaq Revenue 1998 $1.6B, 25% Growth Source: Industry analysts

  29. Better answers. (name of presenter, company)

  30. Better answers. (name of presenter, company)

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