Starbucks Introduces New Iced Coffee RTD Line Extensions

Ready-To-Drink Line Extensions

SEATTLE – Feb. 8, 2006 – Starbucks Coffee Company (Nasdaq: SBUX) today announced the launch of its new ready-to-drink coffee drink, Starbucks® Iced Coffee, in the U.S. through the North American Coffee Partnership, a joint venture with Pepsi-Cola Company. With the introduction of Starbucks Iced Coffee, the North American Coffee Partnership is creating a new coffee refreshment segment within the more than $800 million overall ready-to-drink coffee category in the U.S.
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Starbucks Iced Coffee is a refreshing, cold coffee drink made with Starbucks Italian Roast coffee and just a touch of milk and sweetness, offering the great tasting high-quality coffee customers expect from Starbucks. This new beverage is a simple, refreshingly drinkable cold coffee beverage which will appeal to Starbucks coffee lovers. Starbucks Iced Coffee will be available in Starbucks Company-operated retail stores in the U.S. beginning late March 2006. Additionally, grocery and convenience stores nationally in the U.S. will carry regular and light varieties of Starbucks Iced Coffee beginning May 2006.

In developing the new Iced Coffees, the North American Coffee Partnership looked to trends and customer preferences within the overall coffee category. According to the National Coffee Drinking Trends report, published by the National Coffee Association of the U.S.A., the majority of customers want a coffee beverage with a simple, high-quality, full-coffee flavor and light dairy and sweetness, which until now has been largely unavailable in the U.S. The launch of Starbucks Iced Coffee creates a new coffee refreshment segment of the ready-to-drink coffee category and features the same high-quality coffee available in Starbucks retail stores and coffee-related products globally.

“Opportunities for Starbucks to introduce innovative and exciting ready-to-drink products to our customers allow us to extend the Starbucks Experience to them any place and anytime they choose,” said Gerry Lopez, president, Starbucks Global Consumer Products. “Expanding Starbucks ready-to-drink offerings both in the U.S. and internationally helps to strengthen the Starbucks brand and reinforces our reputation and commitment to innovation, as well as coffee quality and expertise.”

In addition to the launch of Starbucks Iced Coffee, the North American Coffee Partnership is introducing two line extensions within its Starbucks DoubleShot® and bottled Starbucks Frappuccino® brands.

Starbucks DoubleShot Light is a rich blend of espresso and a touch of cream and has the same high-quality, great tasting Starbucks Espresso of the original Starbucks DoubleShot, but with lower fat, calories and sugar. Starbucks DoubleShot Light is available in grocery and convenience stores in the U.S. in May 2006.

Inspired by the handcrafted Strawberries and Crème Frappuccino® blended beverage, the most popular of the non-coffee blended beverages in Starbucks retail stores, the North American Coffee Partnership is introducing bottled Starbucks Strawberries and Crème Frappuccino crème drink. This smooth blend of real strawberries and low-fat milk is the first coffee-free bottled Starbucks Frappuccino crème drink and will be available in Starbucks retail stores in late March 2006 and in grocery and convenience stores nationally in the U.S. early May 2006.

Through the North American Coffee Partnership, the Company introduced bottled Starbucks Frappuccino coffee drinks in 1996 and later, Starbucks DoubleShot espresso drink in 2002. To date, these Starbucks coffee innovations remain the No. 1 products in their respective segments of the ready-to-drink coffee category in the United States. In the U.S. during 2005, the Company sold more than 434 million servings of bottled Starbucks Frappuccino coffee drinks through the North American Coffee Partnership. It would take 500 Starbucks retail stores open eight hours each day for one full year to make the equivalent servings of Starbucks handcrafted caffé lattes.

Starbucks changed the way customers enjoy coffee by making high-quality coffee products available outside of its stores and became a market-maker in the almost non-existent ready-to-drink coffee category in the U.S. in the mid-1990′s. Consumer products, such these ready-to-drink coffee and non-coffee innovations, broaden the brand’s reach to customers who may not have visited a Starbucks retail store.

Bringing the Starbucks Experience to customers wherever they want a high-quality Starbucks ready-to-drink beverage is also an important part of the Company’s overall international growth plans. Currently customers can enjoy bottled Starbucks Frappuccino coffee drinks in both Canada and South Korea, available nationally in both countries. Additionally, in September 2005, Starbucks celebrated the highly successful launch of Starbucks Discoveries(tm) coffee drinks in Japan and Taiwan, Starbucks first ready-to-drink coffee beverage outside North America. Starbucks Discoveries is a fresh, ready-to-drink chilled cup coffee drink, with a short, 14-day shelf life. Since its introduction, Starbucks Discoveries has sold out all daily production and has garnered many awards, including recognition by the Nikkei Marketing Journal as one of the top new products of 2005.

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About Starbucks Coffee Company
Starbucks Corporation is the leading retailer, roaster and brand of specialty coffee in the world, with more than 10,500 retail locations in North America, Latin America, Europe, the Middle East and the Pacific Rim. The Company is committed to offering the highest quality coffee and the Starbucks Experience while conducting its business in ways that produce social, environmental and economic benefits for communities in which it does business. In addition to its retail operations, the Company produces and sells bottled Starbucks Frappuccino® coffee drinks, Starbucks DoubleShot® espresso drink, and a line of superpremium ice creams through its joint venture partnerships. The Company’s brand portfolio provides a wide variety of consumer products. Tazo® Tea’s line of innovative superpremium teas and Hear Music(tm) exceptional compact discs enhance the Starbucks Experience through best-of-class products. The Seattle’s Best Coffee® and Torrefazione Italia® Coffee brands enable Starbucks to appeal to a broader consumer base by offering an alternative variety of coffee flavor profiles.

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About Pepsi
Purchase, N.Y.-based Pepsi-Cola North America (www.pepsi.com) is the $4 billion refreshment beverage unit of PepsiCo Inc. in the United States and Canada. Its U.S. brands include Pepsi, Diet Pepsi, Pepsi ONE, Wild Cherry Pepsi, Pepsi Twist, Pepsi Vanilla, Mountain Dew, Diet Mountain Dew, Mountain Dew Code Red, Mountain Dew LiveWire, Sierra Mist, Sierra Mist Free, Mug, Tropicana Soda, Aquafina, Aquafina FlavorSplash, Aquafina Sparkling, Quaker Milk Chillers, Dole single-serve juices, Tropicana Juice Drinks and SoBe. The company also makes and markets North America’s best-selling ready-to-drink iced teas and coffees, respectively, via joint ventures with Lipton and Starbucks.

Please contact:
Michelle Naughton Pepsi-Cola North America (914) 253-2950 michelle.naughton@pepsi.com