HP and Apple Partner to Deliver Digital Music Player and iTunes to HP Customers

Strategic alliance - sounds like a licensing agreement to us that will allow Apple and its iTunes service to dominate the music download industry

PRESS RELEASE: Working to provide consumers with the most compelling digital content whenever and wherever they desire, HP (NYSE:HPQ) and Apple (Nasdaq:AAPL) today announced a strategic alliance to deliver an HP-branded digital music player based on Apple's iPod, the No. 1 digital music player in the world, and Apple's award-winning iTunes digital music jukebox and pioneering online music store to HP's customers.

As part of the alliance, HP consumer PCs and notebooks will come preinstalled with Apple's iTunes jukebox software and an easy-reference desktop icon to point consumers directly to the iTunes Music Store, ensuring a simple, seamless music experience. This offering is yet another way that HP is helping consumers enjoy more from their personal digital entertainment content.

“HP's goal is to bring the most compelling entertainment content and experiences to our customers,” said Carly Fiorina, chairman and chief executive officer, HP. “We explored a range of alternatives to deliver a great digital music experience and concluded Apple's iPod music player and iTunes music service were the best by far. By partnering with Apple, we have the opportunity to add value by integrating the world's best digital music offering into HP's larger digital entertainment system strategy.”

“Apple's goal is to get iPods and iTunes into the hands of every music lover around the world, and partnering with HP, an innovative consumer company, is going to help us do just that,” said Steve Jobs, chief executive officer, Apple. “As the industry balkanizes by offering digital music wrapped in a multitude of incompatible proprietary technologies, consumers will be reassured in getting the same unparalleled digital music solutions from both HP and Apple, two leaders in the digital music era.”

According to internal HP research, more than 54 percent of current HP consumers download music to their PCs.

More than 2 million iPods have been sold since its introduction, solidifying its position as the No. 1 digital music player in the world. All iPods work seamlessly with the award-winning iTunes digital music jukebox software and the iTunes Music Store, which has sold more than 30 million songs, providing music fans with the best digital music experience on either a Mac or Windows® PC.

The iTunes Music Store offers Windows and Mac users a music catalog of more than 500,000 songs, the same “gold standard” personal use rights and the same 99 cents-per-song pricing. The iTunes Music Store features online gift certificates for family and friends; Apple's innovative and patent-pending online “Allowance” feature, which allows parents to automatically deposit funds into their kids' iTunes Music Store account every month; more than 5,000 audiobooks, which can be purchased with one click and listened to on a Mac or Windows computer as well as on iPods; Celebrity Playlists; and new exclusive tracks from more than 60 artists. The iTunes Music Store offers music from all five major music companies and over 200 independent music labels.

Pricing and availability
HP's digital music player is expected to become available this summer and be priced competitively to other digital music players currently available.

Beginning this summer, the iTunes software and a desktop icon guiding users to the music site will be preloaded on HP Pavilion, Media Center and Compaq Presario desktop and notebook consumer PCs.


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