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Xerox Corp. (BB63)


Tuesday 27 June, 2000

Xerox Corp.

Alliance, etc

Xerox Corp
27 June 2000

For additional Information contact:

Leslie F. Varon
Director, Investor Relations
[email protected]

Charles K. Wessendorf
Manager, Investor Relations
[email protected]

800 Long Ridge Road
Stamford, Connecticut 06904
Fax (203) 968-3944

June 27, 2000


NEW YORK, June 27, 2000 - Paul A. Allaire, Xerox Corporation (NYSE: XRX)
chairman and chief executive, and Michael Capellas, Compaq Computer Corporation
(NYSE: CPQ) president and chief executive, today will jointly announce a
strategic alliance to bundle new Xerox inkjet printers with Compaq customized
personal computers.

At the press conference at 11:00 A.M. (Eastern Daylight Time), today, Tuesday,
June 27, Xerox will also announce its plans to support inkjet products with a
$200 million marketing and advertising campaign. Using the 'Blue Dog' image made
popular by Louisiana artist George Rodrigue, the campaign will enhance  Xerox'
brand in the small office/home office (SOHO) market.

The press conference will be available by live video webcast at or by calling (800) 441-0022 at approximately
10:50 a.m. to participate in the conference (callers outside the U.S. call (801)

You may view a recording of the conference at or
hear a recording of the conference by calling (402) 220-3819 after 2:00 p.m. on
June 27. No password is required. The telephone recording will be available
until July 1st.

For additional information about The Document Company Xerox, please visit our
Worldwide Web site at


Broad Strategic Alliance Expands Document Solutions for Xerox, Compaq Customers

NEW YORK, June 27, 2000 - Compaq Computer Corporation (NYSE: CPQ) and Xerox 
Corporation (NYSE: XRX) today announced that they are teaming up to combine
customized personal computers from Compaq with new inkjet printers from Xerox in
a joint bundling initiative aimed at small and medium-sized businesses.

The move is part of a broad strategic alliance that includes a focus on the
development of new document services and Internet initiatives.

'We are bringing new value to millions of customers by combining our new line of
inkjet printers with Compaq's powerful personal computers and distribution 
capacity,' said Paul A. Allaire, Xerox chairman and chief executive officer. 
This alliance, coupled with the launch of our new products and an aggressive
marketing campaign, reinforce Xerox' commitment to the SOHO market.'

'By strengthening our long-standing relationship with Xerox, we are now able to
deliver a richer and more differentiated set of solutions to our customers,'
said Michael D. Capellas, Compaq president and chief executive officer. 'This is
an outstanding proof point for a strategic relationship that leverages the
combined power, performance, quality and convenience of Xerox and Compaq
technology, products and services.'

Compaq will bundle a number of Xerox personal products, including the new M 
Series color inkjet printers and multifunction products with its iPaq and Small
and Medium Business personal computers. Customers will also be able to order
Xerox products with Compaq Deskpro desktop PCs, Armada notebook PCs and    
Professional Workstations.

The initiative will make use of Compaq's configure-to-order capabilities that
deliver customized PCs, printers and related hardware and software based on 
specific customer needs. Bundles are available directly from Compaq - online or
by phone - through Compaq DirectPlus as well as through Compaq Authorized
Resellers participating in the company's Partner Direct program.

Each bundle will include a Compaq PC, monitor and a Xerox printer and will 
range in price from under $900 to about $2,000. Two personal laser printers, the
DocuPrint P8ex and P1202, will be part of the bundle options as well. In the
United States, bundles featuring the DocuPrint P8ex and P1202 are available
immediately; bundles featuring the M Series products will be available in July.
Similar bundling initiatives are planned for Europe and other regions.

The Xerox M Series inkjet products are the first to result from the company's
SOHO Printing Alliance with Sharp Corporation and Fuji Xerox.

At a street price of about $149 and $199 respectively, the DocuPrint M750 and 
M760 are designed for the small business user, delivering the best business
quality color printing in their class at speeds up to twice as fast as the
competition. The WorkCentre M940 and M950 products feature the same
technology-driven performance and advantages as the printers, but they also add
the versatility and productivity of copier-like flatbed copying and scanning.

Beyond the initial bundling agreement, the strategic alliance paves the way  for
additional integrated document services and solutions from Xerox and  Compaq. 
These offerings will enhance the value of each company's solutions  by
integrating Xerox and Compaq hardware and software.  The companies are jointly
developing solutions that use the scanning abilities of Xerox Document Centre, 
Compaq's Work Expeditor workflow application, and Microsoft Exchange to enhance
document management and work processes.

Compaq Computer Corporation, a Fortune Global 100 company, is the world's 
largest supplier of computing systems. Compaq designs, develops, manufactures 
and markets hardware, software, solutions and services.  Those include
enterprise computing solutions, fault-tolerant business-critical solutions,  and
communications products, commercial desktop and portable products, and consumer

Compaq products and services are sold in more than 200 countries directly  to
businesses, through a network of authorized Compaq marketing partners, and  
directly to businesses and consumers through Compaq markets its
products and services primarily to customers from the business, home, government
and education sectors. Customer support and information about  Compaq and its
products and services are available at

Xerox Corporation, a $19 billion enterprise serving the worldwide document
processing market, develops, manufactures, markets, services and finances  a
full range of products and services that make businesses more productive.  The 
Xerox Small Office/Home Office Group creates and sells Xerox personal products 
to small business and SOHO customers through retailers, e-tailers and strategic
marketing partners. For more information on Xerox, visit

For additional information about The Document Company Xerox, please visit our
Worldwide Web site at


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