Hughes, H-P in Computer Joint Venture : Technology: The deal will give Hewlett-Packard access to the military workstation market and Hughes access to the civilian market.


Hughes Aircraft Co.'s Ground Systems Group is to announce today an agreement with Hewlett-Packard Co. to make advanced computer workstations and other computer equipment for government, military and aerospace applications.

The companies estimate that the combined revenues of the alliance will exceed $200 million in the first three years.

Under the agreement--the terms of which the companies confirmed late last week--Hughes will buy workstations from Hewlett-Packard, customize them for the different applications and sell them to customers.

Hughes officials said the alliance will allow it to penetrate commercial workstation markets and give Palo Alto-based Hewlett-Packard a presence in the $1 billion-a-year military workstation market worldwide.


Ken Dahlberg, a group vice president and general manager at Hughes, said the alliance gives the company a chance to diversify into civilian products. Mainly a producer of weapons systems, Hughes’ Ground Systems Group’s biggest civilian effort now is production of air traffic-control systems.

Negotiations between the Hughes unit and Hewlett-Packard spanned two years.

The deal calls for Hewlett-Packard to transfer its Tempest anti-spying technology and operations to Hughes. The venture will jointly develop a high-resolution tactical display workstation and reinforce Hewlett-Packard commercial workstations so they can survive in rough military environments.

Bob Dowden, manager of the Hewlett-Packard unit, said strategic alliances are becoming common among defense firms that seek to straddle both the civilian and military markets.


Hughes will create a special operating unit with up to 100 employees dedicated to the Hewlett-Packard alliance. Development of the tactical display workstation and conversion of Hewlett-Packard commercial workstations for military use will begin in the first quarter of 1991.

The new product lines, based on Hewlett-Packard’s HP 9000 Series 800 and Series 300 workstations, will be manufactured and designed by Hughes in Fullerton. Hewlett-Packard will provide sales and support.