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Intnl Bus Mach (IBM)

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Tuesday 16 April, 2002

Intnl Bus Mach



    TOKYO, Japan and ARMONK, N.Y.-(BUSINESS WIRE)-April 16, 2002-

         Hitachi and IBM Agree to Strategic Storage Alliance

       Plans Call for Combined HDD Operations, Collaboration on
                       Systems Interoperability

Hitachi, Ltd. (NYSE:HIT, TSE: 6501) and IBM today announced plans to
form a strategic business alliance designed to accelerate the delivery
of advanced storage technologies and products to market.

Under the terms of the preliminary agreement, the companies plan a
multi-year alliance to research and develop new open standards-based
technologies for next-generation storage networks, systems and

In addition to, and separate from, the systems alliance, the two
companies intend to combine various hard-disk drive (HDD) operations
into a new standalone, joint venture company, integrating their
world-class research, development and manufacturing operations, as
well as related sales and marketing teams. Upon completion of
negotiations, Hitachi is expected to hold 70 percent of the joint
venture and make a payment to IBM for its HDD assets.

'Strong hardware is essential to our company-wide efforts to enhance
solutions operations,' said Yoshiro Kuwata, executive vice president
and director, Hitachi, Ltd. 'Now, with the top-quality hard-disk drive
and RAID hardware made possible through this alliance with IBM, we
will strive to be a world leader in this increasingly competitive
industry. Use of HDDs is expanding, not only in PCs, servers and RAID
systems, but also in a wide range of emerging digital appliances. As
such, it is a critical component in a broad range of important current
and next-generation Hitachi products.'

'Our two companies believe that the evolving nature of the storage
industry is creating tremendous opportunity,' said Nicholas Donofrio,
IBM senior vice president, corporate technology and manufacturing. 'On
the high end, customers of storage systems are increasingly demanding
interoperability, ease of storage management, and better
cost/performance. Our commitment to promote open standards will speed
the pace of innovation and each company's ability to deliver powerful,
cost-effective storage systems and networking technology to the
enterprise. Vendors that stay on the proprietary path risk being left

'On the other hand, the disk drive industry is extremely competitive
and coping with many issues,' said Donofrio. 'There, the winners will
be companies that can combine true technical leadership with global
economies of scale. That's what this joint venture is intended to

Central to the storage systems alliance, the two companies plan a
common approach to virtualization, based on IBM technology, that will
allow users to more easily manage all their networked storage systems
as a single resource. In addition, Hitachi and IBM intend to jointly
develop high-performance technologies and functionality for
next-generation high-end storage systems and solutions.

Hitachi and IBM will continue to drive interoperability and open
standards for the management of multi-vendor networks. In conjunction
with existing standards body initiatives, the companies intend to
deploy the emerging Common Information Model (CIM) standard for better
storage management.

Separately, and subject to the successful completion of negotiations
and applicable regulatory processes, the joint venture will combine
selected Hitachi and IBM disk drive assets, including employees,
facilities and intellectual property. Both Hitachi and IBM expect to
source a major portion of their HDD supply from the joint venture. The
joint venture will be based in San Jose, California. The new company's
management team is expected to include executives from both companies.

'By bringing together the world-class HDD research and development
capabilities of Hitachi and IBM, the joint venture should expand the
market for new digital appliances and more quickly bring to market
advanced product offerings,' said Mr. Kuwata. 'We also expect
customers will benefit from the improved efficiencies of our combined
business operations.'

Hitachi and IBM expect to announce further details of the alliance at
a later date.

Hitachi and IBM have an established history of business cooperation.
Most recently, the two companies have conducted joint development and
manufacturing activities in server operations.
Japan:  Tsuyoshi Miyata, Hirotaka Ohno
Hitachi, Ltd.
Tel:  +81-3-3258-2057
[email protected]
[email protected]

Singapore:  Yuji Hoshino
Hitachi Asia Ltd.
Tel:  +65-231-2522
[email protected]

US:  Masahiro Takahashi
Hitachi America, Ltd.
Tel:  +1-650-244-7902
[email protected]

UK:  Kantaro Tan
Hitachi Europe Ltd.
Tel:  +44-1628-585379
[email protected]

   Short Name: Intnl Bus Mach
   Category Code: MSC
   Sequence Number: 00000018
   Time of Receipt (in Greenwich Mean Time): 16-APR-2002 10:38 PM GMT


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