Bank of America

Type Public (NYSE: BAC)

Founded

(as "Bank of America")
San Francisco, CA (1928)
(acquiring banks)
Charlotte, NC (1874)
Boston, MA (1784)

Headquarters Charlotte, North Carolina, USA

Key people

Ken Lewis, Chairman & CEO
Amy Brinkley, Global Risk Executive
Alvaro de Molina, CFO


Industry Money Center Banks


Products Banking


Revenue $83.980 billion USD (2005)


Operating income $42.877 billion USD (2005)


Net income $16.447 billion USD (2005)


Employees 176,638 (2005)


Website Bank Of America


Corporate History


NationsBank

See NationsBank for a history of that entity before the merger in 1998 with BankAmerica Corporation.


BankAmerica and the BankAmericard

Amadeo Giannini was the founder of the modern day Bank of America NT&SA. After the 1906 San Francisco earthquake his Bank of Italy became a leader of the San Francisco banking community by providing loans to those struck by the disaster.

In the late 1920's, Giannini approached Orra E. Monnette, President and founder of the Los Angeles based Bank of America, Los Angeles about a potential merger between the two entities. The Los Angeles based bank exhibited strong growth throughout the 1920s, due in part to its success in developing an advanced bank branching system. The merger of the two institutions was completed in early 1929 and took the name Bank of America. The combined company was headed by Giannini with Monnette serving as co-Chair.3

While the names of many nationally chartered banks end with the initials 'N.A.' (National Association), Giannini picked a unique ending, National Trust and Savings Association, or 'NT&SA', because he wanted the name to highlight the different functions of the bank. BofA was the only NT&SA in the country. The bank was soon the largest in California.

Giannini also sought to build a national bank, expanding into most of the western states as well as into the insurance industry, under the aegis of his holding company, Transamerica Corporation. Bank of America NT&SA also had banking relationships in international financial markets. With the passage of the Bank Holding Company Act of 1956, banks were prohibited from owning non-banking subsidiaries such as insurance companies, and Bank of America and Transamerica were separated, with the latter company continuing in the insurance business. However, federal banking regulators prohibited Bank of America's interstate banking activity, and Bank of America's domestic banks outside of California were forced into a separate company that eventually became First Interstate Bancorp, which was acquired by Wells Fargo Corp. in 1996. It was not until the 1980s with a change in federal banking legislation and regulation that Bank of America was again able to expand its domestic consumer banking activity outside of California. California was the nation's fastest growing state during the post-World War II boom, with the highest use of checking accounts (partially driven by many soldiers being paid via bank accounts during WWII), resulting in BankAmerica being swamped by checks. By 1949, the branches had to close at 2:00pm in order to process the bookkeeping by 5:00 p.m. To cope with the transaction volume, the bank invested heavily in information technology and is generally credited, together with GE and SRI, with inventing modern centralized bank operations, along with a number of financial transaction processing technologies such as automatic check processing, account numbers, and Magnetic Ink Character Recognition (MICR). Based upon these technologies, credit cards were able to be linked directly to individual bank accounts. Because of the efficiency of these technologies, the bank had significantly lower administrative costs than other banks and was able to expand until it became the world's largest bank in the early 1970s.

In 1959, it invented the bank credit card, the BankAmericard, which changed its name to VISA in 1977. A consortium of other California banks came up with Master Charge (now MasterCard) in order to compete with BankAmericard.


Expansion outside of California

Following passage of the Bank Holding Company Act of 1967, BankAmerica Corporation was established for the purpose of owning BankAmerica and its subsidiaries.

BankAmerica expanded outside California in 1983 with its acquisition of Seafirst Corporation of Seattle, Washington, and its wholly owned banking subsidiary, Seattle-First National Bank. Seafirst was at risk of seizure by the federal government after becoming insolvent due to a series of bad loans to the oil industry. BankAmerica continued to operate its new subsidiary as Seafirst rather than Bank of America until its 1998 merger with NationsBank.

BankAmerica was dealt huge losses in 1986 and 1987 due to the placement of a series of bad loans in the Third World, particularly in Latin America. The company fired its CEO, Sam Armacost, although Armacost blamed the problems on his predecessor, A.W. (Tom) Clausen, who was then appointed to replace Armacost. The losses resulted in a huge decline of BankAmerica stock, making it vulnerable to a hostile takeover.

First Interstate Bancorp of Los Angeles (which had originated from banks once owned by BofA), launched such a bid in the fall of 1986, although BankAmerica rebuffed it, mostly by selling its FinanceAmerica subsidiary to Chrysler and by selling the brokerage firm Charles Schwab and Co. back to Mr. Schwab. On the day of the 1987 stock market crash, BankAmerica was trading at $8 per share, although by 1992 it had rebounded mightily to become one of the biggest gainers of that half-decade. The selling of the corporate headquarters building in downtown San Francisco to raise capital was a symbolic blow to the bank.

BankAmerica's next big acquisition came in 1992. BankAmerica acquired its California rival, Security Pacific Corporation and its subsidiary Security Pacific National Bank in California and other banks in Arizona, Idaho, Oregon and Washington (which Security Pacific had acquired in a series of acquisitions in the late 1980s). This was, at the time, the biggest bank acquisition in history. Federal regulators nevertheless forced the sale of Security Pacific's Washington subsidiary, Rainier Bank, because the combination of Seafirst and Rainier would have given BankAmerica too large a share of the market in that state. Later that year, BankAmerica expanded into Nevada by acquiring Valley Bank of Nevada.

In 1994, BankAmerica acquired the Continental Illinois National Bank and Trust Co. of Chicago, which had become federally-owned as part of the same oil industry debacle that had brought down Seafirst. At the time, no bank had the resources to bail out Continental, so the federal government operated the bank for nearly a decade. Illinois at that time regulated branch banking extremely heavily, so Bank of America Illinois was a single-unit bank until the 21st century. Bank of America moved its national lending department to Chicago in an effort to establish a financial beachhead in the region.

These mergers helped BankAmerica Corporation once again become the largest U.S. bank holding company in terms of deposits, but the company fell to second place in 1997 behind fast-growing NationsBank Corporation and to third in 1998, also behind North Carolina's First Union Corp. In 1998, Bank Of America and NationsBank executed a merger-of-equal and changed the headquarter to Charlotte, North Carolina.

Bank of America Lawsuit aganist former Bank officers

The committee overseeing the liquidation of Bank Building and Equipment Corp. of America is seeking $23 million in actual damages and $23 million in punitive damages against three former officers of the defunct company.


The three defendants are Carl Weis Jr., the former chief executive; Myron Carpenter, the former chief financial officer, and Doug Clements, who ran the Loughman's division of BBC from 1987 until the parent company filed for bankruptcy protection in 1990.


The lawsuit alleges Clements perpetrated a massive financial fraud that "ultimately led to the demise of BBC."


The fraud not only caused the company to lose $8 million in contracts from unprofitable jobs, but also kept the otherwise profitable firm from earning $15 million, the suit said.


Merger of NationsBank and BankAmerica

The purchase of BankAmerica Corp. by NationsBank Corporation was the largest bank acquisition in history at that time. While the deal was technically a purchase of BankAmerica Corporation by NationsBank, with the renaming of the former entity to Bank of America Corporation, the deal was structured as a merger, and Bank of America NT&SA, changing its name to Bank of America, N.A. was the remaining legal bank entity. The bank still operates under Federal Charter 13044 which was granted to Giannini's Bank of Italy on March 1, 1927. Despite the mammoth size of the two companies, federal regulators insisted only upon the divestiture of 13 branches in New Mexico, in towns that would be left with only a single bank following the combination. This is because branch divestitures are only required if the combined company will have a larger than 25 percent FDIC deposit market share in a particular state or 10 percent deposit market share overall. Following the $64.8 billion acquisition of BankAmerica by NationsBank, the resulting Bank of America had combined assets of $570 billion, and 4,800 branches in 22 states.

In 2001, Bank of America CEO and chairman Hugh McColl stepped down and named Ken Lewis as his successor. Lewis's greater focus on financial discipline and efficiency contrasted greatly with the expansionary mergers and acquisition strategy of his predecessor.

In 2004, Bank of America purchased Louisville, Kentucky-based National Processing Company for $1.4 billion from National City Corp. The renamed company- BA Merchant Services- processes one in every six VISA and MasterCard transactions. The company also provides financial solutions for travel and healthcare companies. BA Merchant Services is headquartered in Louisville.

In 2004, Bank of America acquired Boston, Massachusetts-based FleetBoston Financial for $47 billion to solidify Bank of America's position as the bank with the largest FDIC-rated deposit market share in the United States with $513 billion in deposits, well ahead of the number two bank holding company, newly-merged JPMorgan Chase-Bank One with $353 billion in deposits and number three Wells Fargo & Co. with $228 billion (As of June 30, 2003).


Bank of America Today

On June 30, 2005 the bank announced it would purchase credit card giant MBNA for $35 billion in cash and stock. The Federal Reserve Board gave final approval to the merger between Bank of America and MBNA on December 15, 2005. The merger closed on 1 January 2006, and the completion of the deal solidifies the Bank's position as the largest issuer of credit cards in the U.S., surpassing rival J.P. Morgan Chase. The assimilated former MBNA entity will be called Bank of America Card Services, and will also incorporate Bank of America's existing credit card operations. The combined Bank of America Card Services organization will have more than 40 million active U.S. accounts and nearly $140 billion in managed outstanding balances. Bank of America is already the world's leader in active debit cards.

Bank of America is currently constructing a massive new headquarters for its New York City operations. The skyscaper will be located on 42nd Street and Avenue of the Americas, at Bryant Park, and will feature state-of-the-art "green" - environmentally friendly - technology throughout its 1.2 million square feet (120,000 m²) of office space. After its completion, the building will be the headquarter for the company's investment banking division, and will also host most of Bank of America's New York based staff.


Divisions

Bank of America today comprises three main divisions.


Global Consumer and Small Business Banking

Global Consumer and Small Business Banking (GC&SBB) is the largest division in the company, and deals primarily with consumer banking and credit card issuance. The acquisition of FleetBoston in 2004 and MBNA in 2005 significantly expanded its size and range of services, resulting in about 51% of the company's total revenue in 2005. It competes directly with the retail banking divisions of Citigroup and JPMorganChase. The GC&SBB organization includes over 5,700 retail branches and over 17,000 ATMs across the United States.

MBNA merger

As a result of the merger with MBNA, Bank of America is now the largest issuer of credit, debit and prepaid cards in the world based on total purchase volume as well as the largest Consumer bank and #1 small business lender in the United States.


Global Corporate and Investment Banking

Global Corporate and Investment Banking (GCIB), also known as Banc of America Securities, provides mergers and acquisitions advisory, underwriting, as well as trading in fixed income and equities markets. Its strongest groups include Leveraged Finance, Syndicated Loans, and Mortgage Backed Securities. It also has one of the largest research teams on Wall Street.


Global Wealth and Investment Management

Global Wealth and Investment Management (GWIM) manages assets of institutions and individuals. It is among the 10 largest U.S. wealth managers (ranked by private banking assets under management in accounts of $1 million or more as of June 30, 2005). In July 2006, Chairman Ken Lewis announced that GWIM's total assets under management exceeded $500,000.


Controversy


Enron scandal

Bank of America was one of several banks linked to the fraudulent activities committed by Enron. In 2004, they settled a class action lawsuit brought on by Enron investors, for $69 million. The suit specifically claimed that Bank of America had "actively engaged and participated in the fraudulent scheme" and "furthered Enron's fraudulent course of conduct and business in several ways".

Under the settlement, the bank denies that it violated any law and explains that it settled the matter solely to eliminate the uncertainties, expense and distraction of further protracted litigation.


Raiding Social Security

In 2004, a California jury decided that Bank of America had illegally raided the Social Security benefits of a million customers. The jury awarded damages that could exceed $1 billion. Bank of America had been accused of withholding customers' direct deposit social security benefit payments to cover debts in cases where a debt is owed to the bank by the customer (e.g.: due to an overdrawn account, various service fees, etc.), this is in direct violation of California state law. The suit claims that Bank of America knew about the law, and concealed the facts of this law from their customers. Bank of America counters that it only followed standard industry practice of using monthly pre-authorized direct deposits to cover overdrafts and the like. -- The case is on appeal.


In 1999, a class action lawsuit was filed against Bank of America for engaging in the practice of "Biggest Check First" check-clearing. Put simply, the bank clears checks in order from biggest to smallest for transactions presented on the same business day, with less regard to what time they come in during that business day. Customers allege that this is purposely done, to cause more checks to bounce, triggering more overdraft fees for the bank to collect.

Here's an example: A customer has $1,000 in his checking account. Check numbers 101 through 104 come in for processing for $60, $10, $30 and $950, in that order. If the checks are processed by the check number or in ascending order (smallest to largest), the first three checks will clear and the fourth will bounce, meaning the customer will be charged one fee for insufficient funds. NationsBank (now Bank of America) can charge $19 to $35 for each bounced check. If the checks are processed largest to smallest, however, the $950 check will clear first, and the checks for $60, $30 and $10 will bounce, resulting in $57 to $105 in fees. (It depends on how many over drafts the customer has. The first is $19. It progressively rises to $35 with each additional.)

The bank employs the same practice for ATM and debit card transactions. Another example: A customer has $100 in her account. On Saturday she withdraws $80 from an ATM. On Sunday she buys a coffee using her debit card for $3 and puchases a small amount of gas for $15. As of Sunday night, she still has $2 remaining in her account. On Monday, her recurring monthly cable bill is auto-debited from her account, for $150. The bank clears this transaction even though the customer is now in the negative. This is standard grounds for an overdraft fee, so the customer expects to find one on her next statement.

However, when the customer checks her statement, she finds four overdraft charges. One for the cable bill, plus one for each of the debits over the weekend. The customer is naturally confused, as she had not overdrawn her account for any of the weekend transactions. Yet, the bank counts those charges as overdrafts because they do not post until the next business day (Monday), even though the transactions were all authorized over the weekend. Since the bank employs "biggest check first", the smaller weekend transactions clear after the cable bill that came in later in the business day. The customer get four overdraft charges total, instead of one.

BOA paid a $9M settlement and the lawsuit was dismissed without an admission of fault. Bank of America continues to process transactions from highest to lowest amounts. New York, California, and Nevada are currently fighting the practice.

When asked about the practice, bank representatives claim that it insulates the Bank from undue risk. By paying the largest items first, the Bank ensures that no loss is incurred on the largest items, by withdrawing the appropriate funds from the customer's account and honoring the largest, and most risky items. Smaller items, which may or may not be honored against a negative balance, depending on the account officer's decision, pose less liability to the Bank, and are therefore paid last. Also, regardless of when checks are written, their negotiation can happen in a number of ways, including direct presentment at the drawee bank, at which time funds are immediately reserved out of the customer's account to pay cash to the payee who cashes the item. Such policies are designed to reduce the risk of loss to the bank.

Furthermore, bank representatives also state that larger transactions typically represent more important items on a customer's account such as a mortgage or rent payment, car payment, insurance payment, utility payments, etc. By paying these items first, it is ensured that the customer's most important items are not affected, although smaller less important items may be affected.

Bank of America customers also claim that the bank's ATM and Online Banking systems can be confusing, and cause a false impression of the available balance. Customers claim that this increases the likelihood of incurring overdraft fees. Customers claim that when using their Bank of America debit card for purchases or ATM withdrawals, the amount of the charge is immediately deducted, then made available several days later, then deducted once again. This is as a result of the authorization hold process. If charges were made during the period when the money was temporarily back in the account, those charges go through - and incur an overdraft fee. BOA's response is that their Online Banking and ATM systems should be used in conjunction with a written account register so that customers are aware of all pending transactions on their accounts.

In fairness, the "Biggest Check First" policy is not unique to Bank of America, and is common among other large U.S. banks, such as JP Morgan Chase, Citibank, and Wachovia. BoA has increased the length of time [debit card] authorizations are listed as pending in online banking from 1 business day to 3 business days to reduce confusion over the actual available balance.

Online Bill Pay

Another relatively new policy Bank of America has implemented is the sending of automated bill payments without available funds -- and the related charging of fees. If previous Fleet or BankBoston customers had an automated bill payment set up but either scheduled the payment for the wrong day or else didn't deposit necessary funds in time, the bank would attempt to make the payments for three days until the money was available, before cancelling the payment attempt. As no money would be transferred unless funding was available, no fees were charged.

Bank of America, however, changed their policy to send the payments even with a zero balance, even electronic payments where it is clear the funds do not exist. They then charge customers up to $35 per scheduled payment. They also do not then cancel the payments, but continue to re-attempt the payments one more time, meaning that if customers do not deposit funds immediately into their account, they can be charged up to $35 per mistakenly scheduled payment, for up to two mistaken payments, or $35 per incident, where their previous banks would have charged nothing.

In February 2006 Bank of America also changed their online bill pay policy to send customers' automated bill payments without debiting the payments from their account until the day after they are processed by the payees' bank. This differs from most online banking customers' previous experience with having the funds immediately debited from their account to help keep their account balance positive, and would seem to be done purely to incur additional overdraft charges.



Online banking security


Website redirection weakness

In April 2005, Bank of America was the target of a phishing scheme that exploited a flaw in the Bank of America online banking website. Normally, a phishing link that accesses an illegitimate website can be detected by carefully reading the URL in the web browser. One URL for the Bank of America website allowed a second URL to be passed to the Bank of America website for redirection. This allowed the phishing link to access an illegitimate website through the Bank of America website and thereby display a "real" Bank of America URL while accessing the illegitimate site.


SiteKey

Announced in May of 2005, SiteKey, provided by Passmark Security, is an additional login step added to the Bank of America online banking website. If the Bank of America system recognizes the user's computer it displays a small image and a text token previously selected by the user. If the user does not recognize the image the user is instructed to not log in and call a phone number for "Electronic Banking Services." If the Bank of America system does not recognize the user's computer the user is asked one of three security questions that had previously been selected and answered by the user. The bank claims this as an added security measure to help reduce the likelihood of phishing attacks by allowing users to easily verify the authenticity of the server to which they are connected.

Though SiteKey will by no means render Bank of America customers immune to phishing attacks, it is a step in the right direction since it demands a two-way exchange of authenticating information: The Web server presents the user its credentials (your chosen image and text) as a means of proving they really are the bank. Only after seeing the image they have chosen, the bank instructs its users, should they, in turn, present their credentials (user ID and passcode).

Some people have noted that Sitekey, or at very least customer account numbers, may be subject to exposure via brute force attacks. When a user enters any valid bank account number, Sitekey prompts for the selection of the correct Sitekey. Thus it is possible to confirm the existence of a valid account by inspecting the format of a valid account number, cleverly tuning guesses of account numbers, and repeatedly submitting the numbers.

While the two-way authentication is currently an uncommon function among the consumer banking industry, the recognition of the user's computer, or more accurately, their browser, is still done in the normal way using HTTP cookies. Additionally, an Adobe Flash shared object is added to the user's computer that stores identifying details of customers, such as log-ins, in a way that is said to prevent most customers from finding or deleting them.


International operations

In 2005, Bank of America acquired a 9% stake in China Construction Bank, China's second largest bank, for $3 billion. It represented the company's largest foray into China's growing banking sector. Bank of America currently has offices in Hong Kong, Shanghai, and Guangzhou and is looking to greatly expand its Chinese business as a result of this deal. Bank of America has also invested in opening new branches in India, particularly Mumbai.

Bank of America operates under the name Bank Boston in many other countries, including Brazil. In Mexico, it operates under the name Bank of America.


Diversity

Bank of America was named one of the 100 Best Companies for Working Mothers in 2004 by Working Mothers magazine. Furthermore, Amy Woods Brinkley, the Bank's Global Risk Executive, and Barbara Desoer, the Bank's Global Technology and Service Fulfillment Executive, were named two of the most powerful women in Banking by US Banker magazine, and were among the "top 50 most powerful women in business," as ranked by Fortune.


Radio Financial Adviser Clark Howard takes on Bank of America

A San Francisco man, Matthew Shinnick, was arrested and jailed when he tried to verify the validity of a check at Bank of America branch after receiving a check from someone who had seen his ad for bicycles on craigslist.com. Radio financial adviser Clark Howard found out about this story and talked with the man, Matthew Shinnick, who has spent about $14,000 in legal fees to clear his name. He went into his bank to see if the check was legitimate and verify that there was money in the person’s account. He was told it was a valid account and so he cashed the check. At that point, BOA employees called the police and Shinnick was arrested on fraud charges because the check was actually a phony. He had no idea that the real criminal had used the name of a legitimate company to fake a check. So, Matthew sat in the bank branch for hours while police figured out what to do and then spent the night in jail. Once he got out, he wanted to clear his name legally so the arrest would not come back to haunt him. He had to hire attorneys to do this and it cost him nearly $14,000. He then went to Bank of America and asked that the bank cover his fees because it was the bank’s error. But so far BOA has refused. Clark Howard has had two officers from BOA to represent the bank, and stated he would cover half the legal costs if BOA would cover half. BOA has refused and Clark Howard stated that they have threatened legal action against him. Clark Howard has urged his listeners to withdraw their money and refuse to do business with Bank of America any longer. He keeps a running tally on how much money his listeners have withdrawn from BOA on his website, www.clarkhoward.com.


Major sponsorships

Bank of America owns the naming rights of several venues in the sports world.

* Bank of America Stadium, Charlotte - Carolina Panthers, NFL.
* Bank of America 500, a NASCAR race that is hosted annually at Lowe's Motor Speedway.
* Bank of America Colonial, a PGA Tour golf tournament.
* Official bank of
o Major League Baseball
o Minor League Baseball
o Little League

Ad campaigns that run during the Little League World Series and the World Series use the slogan "The Official Bank of Baseball."


External links

# Bank of America homepage
# Find this bank's branches on myBank.com

Source:-Wikipedia

Hewlett-Packard

Type: Public (NYSE: HPQ)

Founded: Palo Alto, California (1939)

Headquarters: Palo Alto, California, USA

Key people:

Mark V. Hurd, CEO & President
Patricia Dunn, Chairman until Jan-07
Mark V. Hurd, Chairman from Jan-07
Robert Wayman, CFO
William Hewlett, Founder
David Packard, Founder

Industry:

Computer Systems
Computer Peripherals
Computer software
Consulting
IT Services

Products:

Computer Monitors
Digital Cameras
Digital Imaging
Personal Computers
Printers

Revenue: $88.89 billion USD (2006)

Net income: $3.17 Billion USD (2006)

Employees: 150,000 (2006)

Website: Hewlett-Packard


Company history


Founding

HP was founded in 1939 as a manufacturer of test and measurement instruments with a US$538 investment in a Palo Alto, CA garage by Bill Hewlett and Dave Packard.[1] They had both graduated from Stanford University in 1934. They founded their company in a garage there, but they did this while still Fellows at Stanford (so their story was not quite rags to riches, more academic gowns to riches)[1]. Their first product was a precision audio oscillator, the Model 200A. Their innovation was the use of a small night-light bulb as a temperature dependent resistor in a critical portion of the circuit. This allowed them to sell the Model 200A for $54.40 when competitors were selling less stable oscillators for over $200. Their company's name, Hewlett-Packard, was derived from their last names and had Bill not won a coin toss, the company today could have been known as Packard-Hewlett. One of the company's earliest customers was Walt Disney Productions, who bought eight Model 200B oscillators (at $71.50 each) for use in testing the Fantasound stereophonic sound system for the movie Fantasia.

The sixties and seventies

HP is recognized as the symbolic founder of Silicon Valley, although it did not actively investigate semiconductor devices until a few years after the "Traitorous Eight" had abandoned William Shockley to create Fairchild Semiconductor in 1957. Hewlett-Packard's HP Associates division, established around 1960, developed semiconductor devices primarily for internal use. Instruments and calculators were some of the products using these devices.
"The new Hewlett-Packard 9100A personal computer" is "ready, willing, and able ... to relieve you of waiting to get on the big computer."

"The new Hewlett-Packard 9100A personal computer" is "ready, willing, and able ... to relieve you of waiting to get on the big computer."

HP is acknowledged by Wired magazine as the producer of the world's first personal computer, in 1968, the Hewlett-Packard 9100A.[2] HP called it a desktop calculator because, as Bill Hewlett said, "If we had called it a computer, it would have been rejected by our customers' computer gurus because it didn't look like an IBM. We therefore decided to call it a calculator, and all such nonsense disappeared." An engineering triumph at the time, the logic circuit was produced without any integrated circuits; the assembly of the CPU having been entirely executed in discrete components. With CRT readout, magnetic card storage, and printer the price was around $5000.

The company earned global respect for a variety of products. They introduced the world's first handheld scientific electronic calculator in 1972 (the HP-35), the first handheld programmable in 1974 (the HP-65), the first alphanumeric, programmable, expandable in 1979 (the HP-41C), and the first symbolic and graphing calculator HP-28C. Like their scientific and business calculators, their oscilloscopes, logic analyzers, and other measurement instruments have a reputation for sturdiness and usability (the latter products are now part of spin-off Agilent's product line). The company's design philosophy in this period was summarized as "design for the guy at the next bench".

The eighties and beyond

In 1984, HP introduced both inkjet and laser printers for the desktop. Along with its scanner product line, these have later been developed into successful multifunction products, the most significant being single-unit printer/scanner/copier/fax machines. The print mechanisms in HP's tremendously popular LaserJet line of laser printers depend almost entirely on Canon's components (print engines), which in turn use technology developed by Xerox. HP develops the hardware, firmware, and software that convert data into dots for the mechanism to print.

In the 1990s, HP expanded their computer product line, which initially had been targeted at university, research, and business customers, to reach consumers. Later in the decade HP opened hpshopping.com as an independent subsidiary to sell online, direct to consumers; the store was rebranded "HP Home & Home Office Store" in 2005. HP also grew through acquisitions, buying Apollo Computer in 1989, Convex Computer in 1995, and Compaq in 2002. Compaq itself had bought Tandem Computers in 1997 (which had been started by ex-HP employees), and Digital Equipment Corporation in 1998. Following this strategy HP became a major player in desktops, laptops, and servers for many different markets.

In 1987, the Palo Alto garage where Hewlett and Packard started their business was designated as a California State historical landmark.

In July of 1999, HP appointed Carly Fiorina as CEO. Fiorina was the first woman ever to serve as CEO of a company included in the Dow Jones Industrial Average. Fiorina was forced to resign on February 9, 2005.


Technology and Products

HP has a successful line of printers, scanners, digital cameras, calculators, PDAs, servers, workstations, and home-small business computers. HP today promotes itself as not just being a hardware and software company, but also one that offers a full range of services to architect, implement and support today's IT infrastructure.

Imaging and Printing

According to HP's 2005 U.S. SEC 10-K filing,[3] HP's Imaging and Printing Group is "the leading imaging and printing systems provider in the world for printer hardware, printing supplies and scanning devices, providing solutions across customer segments from individual consumers to small and medium businesses to large enterprises."

Products and Technology associated with the Imaging and Printing Group include:

* Inkjet and LaserJet printers, consumables and related products.
* the Indigo Digital Press
* the HP Web Jetadmin printer management software

Personal Systems Group

HP's Personal Systems Group is "one of the leading vendors of personal computers ("PCs") in the world based on unit volume shipped and annual revenue."

Personal Systems Group products/technology include:

* Consumer PCs including the HP Pavilion and Compaq Presario series.
* Workstations for Unix, Windows and Linux systems.
* Handheld Computing including iPAQ Pocket PC handheld computing devices
* Digital Entertainment including DVD+RW drives, HP Movie Writer and HP Digital Entertainment Center. HP resold the Apple iPod from HP until November 2005.

Technology Solutions Group

In HP's financial reporting, HP groups its Enterprise Storage and Servers, HP Services and Software under Technology Solutions Group.

HP's Enterprise Storage and Servers Group has product/technology including:

* the ProLiant entry line of x86 based servers (from Compaq)
* the BladeSystem x86 based blade servers
* the Integrity line using the Itanium processor architecture (with Intel) running on several operating systems including HP-UX (a UNIX implementation)
* the HP AlphaServer productline using the Alpha processor (from DEC) and running on both:
o Tru64 operating system (from DEC)
o the OpenVMS large-scale, highly available server operating system (from DEC)
* the NonStop high-reliability architecture and operating system (from Tandem Computers)
* MIPs based Nonstop fault-tolerant server products
* the PA-RISC processor architecture
* the HP 9000 "Superdome" line of Servers and workstations
* the StorageWorks product line, which includes business class and enterprise class data storage and protection products.[4]
* the ProCurve family of network switches, wireless access points, and routers.
HP's Software division has products/technologies including:

* the OpenView family of management software
* the OpenCall family of telecom software


HP Labs

HP Labs (or HP Laboratories) is the research arm of HP. Founded in 1966, HP Labs' function is to deliver breakthrough technologies and to create business opportunities that go beyond HP's current strategies. An example of recent HP Lab technology includes the Memory spot chip.


Partnerships

Hewlett-Packard is a supporter of FOSS and Linux. Some HP employees, such as Linux CTO and former Debian Project Leader Bdale Garbee actively contribute and have official Open Source job responsibilities. Many others participate in the Open Source community as unpaid volunteers. HP is also known in the (GNU/)Linux community for releasing drivers for many of their printers under the GNU GPL.

Hewlett-Packard also works extensively with Microsoft and uses technology from most major software and hardware vendors. Until November 2005, HP offered a re-branded version of Apple's famous iPod

Culture

The founders, known to friends and employees alike as Bill and Dave, developed a unique management style that has come to be known as the HP Way. In Bill's words, the HP Way is "a core ideology . . . [that] includes a deep respect for the individual, a dedication to affordable quality and reliability, a commitment to community responsibility, and a view that the company exists to make technical contributions for the advancement and welfare of humanity."[6]

The HP Alumni Association maintains a tribute to Bill and Dave's version of the HP Way, circa 1992.

Management

* CEO: Mark Hurd (March 29, 2005 - current)
* Non-executive Chairman: Patricia C. Dunn (February 2005 - current) Resigned Tuesday September 12, 2006, effective as of January 18, 2007.


History

* Founder and CEO: David Packard (CEO: 1964 - 1969)
* Founder and CEO: William Hewlett (CEO: 1969 - 1978)
* CEO: John A. Young (1978 - 1992)
* CEO: Lewis Platt (1992 - July 18, 1999)
* Chairman and CEO: Carly Fiorina (July 19, 1999 - February 9, 2005, Appointed chairman in 2000)
* Interim CEO: Robert P. Wayman (February 10, 2005 - March 28, 2005)

Diversity

Hewlett-Packard received a 100% rating on the Corporate Equality Index released by the Human Rights Campaign starting in 2003, the second year of the report. In addition, the company was named one of the 100 Best Companies for Working Mothers in 2004 by Working Mothers magazine.

Hewlett-Packard is also involved in the NEPAD e-school program to provide all schools in Africa with computers and internet access.

Ad campaigns

Hewlett-Packard has used a number of innovative commercials to sell its products.


You + HP: digital photography

A television ad campaign for Hewlett-Packards digital photography (titled "You + HP: digital photography") has been noted for its simple special effects and choice of music. It won "Campaign of the Year" from Adweek magazine in 2004.[8]

Songs used in "You + HP" Campaign:

* "Picture Book" by The Kinks
* "Out of the Picture" by The Robins
* "Pictures of You" by The Cure
* "The Rainbow" by The Apples in Stereo
* "Across the Universe" by The Beatles

Acquisitions

Data Systems, Inc.

A small 5-person company called Data Systems, Inc. Owned by a chemical manufacturer, Union Carbide, who failed in their diversification efforts, HP bought the group and this helped to launch the HP 2116A in 1966. A computer designed to automate the collection and processing of data from the company’s test and measurement devices, it marked HPs entry into the growing computer industry.

Apollo

In 1989, HP Acquired Apollo computer for $476 million. HP was able to achieve a growth in market share after the merger; with the market at the time valued at $4.1 billion and the fastest-growing area of the market.

Compaq

In 2002, Hewlett-Packard merged with Compaq, a controversial move intended to make the company the personal computing leader. The merger opposition was led by Walter Hewlett, son of original founder William Hewlett.

AppIQ

In October of 2005, Hewlett-Packard acquired the private company AppIQ (short for "Application IQ"). The company was founded in 2001 by Ash Ashutosh and David Chang, and offered several digital storage solutions. The company had employed up to 235 people by June 2005.

Mercury Interactive

On July 25, 2006, HP announced plans to acquire Mercury Interactive (MERQ.PK), a company that provides Business Technology Optimization software (i.e. software that helps a company govern, develop and maintain its technology stack). This acquisition is expected to occur in Q4 2006 and will result in an HP software business of around $2 billion.

Competitors

Major competitors of HP in the computer business include Apple Computer, Dell, Gateway, Lenovo (Purchased IBM's Non-server Personal Computer Business), Sony and Toshiba. Major competitors of HP in the server business include Sun Microsystems, IBM and Dell. Major competitors of HP in the printer business include Brother, Canon, Epson, Lexmark and Dell (who rebrands and repackages Lexmark products)

HP pretexting scandal

On September 5th, 2006 Newsweek published a story revealing that the chairwoman of HP, Patricia Dunn, had hired a team of independent electronic-security experts that later spied on HP board members and several journalists, to determine the source of confidential details regarding HP's long-term strategy that was published part of a Cnet article in January, 2006.[9] The group of electronic-security experts had used a technique known as pretexting to obtain call records of HP board members and nine journalists, including reporters for Cnet Networks, the New York Times and the Wall Street Journal. The investigators had misrepresented themselves as the board members and journalists to their phone companies in order to obtain their phone records. Dunn has claimed she did not know beforehand the methods the investigators used to try and determine the source of the leak. [10] On September 12, 2006, HP announced that Mark Hurd, the current CEO, will replace her as Chairman after the HP board meeting on January 18, 2007. Dunn will continue as a HP board member after January 18, 2007, a position she has held since 1998. California Attorney General Bill Lockyer has indicated that charges will be filed against her and several other people inside and outside of HP within the next week.


U.S. House of Representatives Committee on Energy and Commerce Investigation into HP

On September 11th, 2006, CNet News.com publicly released a five page letter dated on September 11th, 2006 written by the U.S. House of Representatives Committee on Energy and Commerce to Patricia Dunn stating that they have been, for the past seven months, conducting an investigation on internet based data brokers who they state use "lies, fraud and deception" to acquire personal information and has stated that anyone can pay a "modest fee" to acquire "itemized incoming and outgoing call logs" for not only cell phone numbers but also for VoIP numbers, landline numbers, and unpublished phone numbers. Additional data that could be given are addresses and other personal data without the consent or prior notice to the owner of the number. The Committee on Energy and Commerce has found out about HP's use of pretexting through their September 6th SEC filing and through their own inquiry of HP's Nominating and Governance Committe and states that they are "troubled" by the information "particularly that it involves HP—one of America's corporate icons."

The Committee on Energy and Commerce Investigation is requesting, under Rules X and XI of the U.S. House of Representatives, the following information from HP by September 18th, 2006:

1. The name and identity of the outside consulting firm cited in HP's September 6th, 2006, filing with the SEC (the outside consulting firm), and of any other outside consultants who were hired by HP to assist in conducting the Leak Investigation.
2. Copies of any contracts, letters of engagement and investigative plans related to the Leak Investigation that was conducted by the outside consulting firm or by any other party.
3. The names and identities of all third parties, whether hired directly by HP or by HP's outside consulting firm, who were used during the leak investigation to procure, or to attempt to procure telephone records and other personal consumer information of any targets or subjects of the Leak Investiagation
4. A list of all individuals or entities that were targets or subjects, or designated as targets or subjects, of the Leak Investigation.
5. A list of all individuals, including HP employees, who were involved with conducting the Leak Investigation or who had contemporaneous knowledge of the Leak Investigation.
6. A list of all individuals or entities whose telephone records or other personal consumer information were procured or attempted to be procured by the outside consulting firm or by any party during the period January 1st, 2005, to the present.
7. A list of all individuals whose telephone records or other personal consumer information were procured by the outside consulting firm or by any party during the period January 1st, 2005, to the present. For each individual, describe the types of records that were procured.
8. Copies of all reports prepared for the Leak Investigation by the outside consulting firm or by any other party, including any and all analysis or opinions regarding the appropriateness or legality of pretexting.
9. A copy of the letter of engagement with the law firm Wilson Sonsini Goodrich & Rosati regarding the Committee Inquiry.
10. Copies of all reports prepared for the Committee Inquiry, including any report prepared by the firm Wilson Sonsini Goodrich & Rosati.
11. Copies of all draft and final Board minutes that either relate to either the Leak Investigation or the Committee Inquiry.

In addition to the above mentioned information, the Committee on Energy and Commerce is also requesting the following information from HP by September 25th, 2006:

12. All records relating either the Leak Investigation or Committee Inquiry, incuding but not limited to communications to or from the outside consulting firm, communications by or between HP employees or Board Members, and communications to or from the outside counsel. Please do not provide any copies of the actual telephone records or any other records procured.

Criticism

Legacy

It is a fact that Agilent Technologies, not HP, bears the product legacy of the original company founded in 1939. Agilent's current portfolio of electronic instruments are descended from HP's very earliest products. HP entered the computer business only after its instrumentation competencies were well-established. Similarly, the history of HP's printer products today can be traced back to the invention of the ThinkJet and LaserJet printers in the early 80's. Agilent was spun off from HP in 1999 and took everything related to instrumentation with it. The merger with Compaq drives HP even farther from its roots in instrumentation. Some include HP's original culture, embodied in the HP Way, in the definition of legacy. Critics claim the HP Way is no longer practiced at HP today.

Calculators

In March 2002, HP announced that it would no longer manufacture financial and scientific calculators – a product line and, indeed, a market, that HP had started thirty years before.[citation needed] HP later recanted and stated in a press release, "The bottom line is that HP calculators are here to stay and they are going to be better than ever, giving our customers more than ever."[12] The extremely popular HP-12C financial calculator, introduced in 1981, still remains in production today.

Iraq

During the Iran-Iraq war, HP was among the companies shipping militarily useful technology to Iraq through its Ohio branch according to the Financial Times.

During the 2003 invasion of Iraq HP shipped militarily useful technology to US forces. The company support for American soldiers can be witnessed in widely distributed videos of soldiers resorting to "repairing" HP products with the precision of a machinegun when HP's outsourced foreign customer support refuses to service a 5510 printer. HP responded publicly with the statement "HP was aware of the issue and resolved it back in March [...] HP responds to each customer service request individually as appropriate and that response is confidential. We take customer service seriously and are committed to providing good customer service."

HP did not state that the defective equipment was replaced, only that the issue was resolved.

Outsourcing

In 1994, HP decided to outsource its manufacturing to third-party vendors and oversea countries to lower costs and raise profits. Today, desktop computers are assembled in Guadalajara, Mexico where HP employs approximately 1,500 workers. Notebook computers are assembled in China from third-party vendors. Servers and workstations are still assembled in the United States.

In 2003, HP had 140,000 employees world wide. Under HP's current restructuring program, HP began reducing its workforce to lower its costs. By 2006, HP experienced a record profit of $1.5 billion in just one quarter.


HP and the Environment

HP have been criticized by Greenpeace, among others. Greenpeace and other environmental groups have alleged HP of poor environmental standards, specifically in relation to the elimination of hazardous substances from products as specified by the European Union's RoHS guidelines for brominated flame retardants and PVC. Greenpeace is also alleging HP of not doing enough to recycle computers and other technology equipment.

Greenpeace's criticism of the technology industry is not limited exclusively to HP, as competitors such as Dell and Apple have also come under fire for alleged similar practices.

Source:-Wikipedia