Xerox Puts Focus On Color

Declaring a "new" Xerox, President and COO Anne Mulcahy unveiled a new market strategy in which the copier and printer giant intends to "own color."

Mulcahy, speaking at a Xerox press conference in New York on Monday, also spotlighted a new printer, the Phaser 2135. The product,available immediately but only through indirect channels,prints 21 pages per minute in color and 26 pages per minute in black and white at 1,200-dpi resolution.

With an estimated base price of $5,999, the Phaser 2135 is nearly four times faster than the closest competing color printer from Hewlett-Packard, the HP 8550 Color LaserJet, according to Xerox. A live demo at the event backed up that claim.

"This is the new Xerox now," Mulcahy said. "If you want color,and you do,you want Xerox."

Gerald Perkel, president of the Xerox Office Printing Business, said the company is helping its channel partners by providing more investment and more back-end rebates to solution providers that have shown a commitment to selling Xerox products. The vendor also has begun an authorization process that enables some solution providers to sell higher-end Xerox products. In addition, Xerox is training its agents, who traditionally have sold copiers to the small and midsize market, to sell Xerox printers as well.

Color products provide greater long-term revenue than black-and-white printers because of the supplies required, Perkel said.

Though the Phaser 2135's price may be too high for some customers, the product will help bring color into the mainstream, says Dendy Young, chairman and CEO of GTSI, a federal government VAR. "With each incremental improvement, color comes closer to the mainstream," Young said. "This is one step forward."

Three years ago, 28 percent of GTSI's printer sales were color units, but that number is now about 37 percent and could reach 50 percent in the next two to three years, Young added.

In explaining Xerox's new strategy, Mulcahy acknowledged the company's current financial difficulties. However, she said Xerox's plan of cash generation, cost reduction and long-term growth is taking shape, and the company stands to return to profitability in the second half of this year. The financial troubles have been "much less of an issue with customers than you might think," Perkel said.

GTSI's Young also is confident Xerox will work out its problems. "We understand their short-term difficulties, but we feel confident to recommend their product," he said.

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