Xerox Q&A: ACS Acquisition Will Not Impact The Channel
Jim Firestone, president of Xerox's corporate operations, spoke with Channelweb.com about what the purchase means and whether it will affect resellers.
Do you think that the ACS acquisition changes the character of Xerox from a product provider to a service provider?
No, we're not losing the product side. This expands our services business substantially, but that's in addition to our hardware.
It seems as though ACS offers a wide range of outsourcing services that are currently provided by your solution provider partners, such as data center outsourcing and network outsourcing, among others. Is that accurate?
ACS is the largest diversified business process outsourcer in the world. They focus on back-office activities, such as medical claims -- they're the second largest Medicare/Medicaid claims processor in the country, they do HR processing, transportation claims processing for Easy Pass. ACS does have some ITO [information technology outsourcing], but that's mostly as a support for their BPO services.
It sounds like Xerox resellers don't have to worry about overlap with ACS's business.
If there's an overlap, it's minor. Our focus is about expanding into BPO from the managed services that we already have, like our MPS [managed print services] program.
I see very little impact on the VAR community because our relationship in supporting the channel will continue to be a key priority for us. ACS may buy some equipment from us that could be ancillary, but this deal is not about hardware, it's about adding services.
Where will ACS take the lead and where will Xerox partners take the lead?
ACS will be run as separate operation, reporting to Ursula Burns. They'll be able to leverage their processing skills with our technology in image scanning and doc management.
Our hardware and solution products will continue to be distributed through the channel. This [deal] is not about the hardware business, which we are very bullish on.
How will ACS affect Xerox's Global Services business?
Xerox Global is about producing and printing pages; ACS is about manipulating information in the document, data extraction and the software that drives that.
Will Xerox draw a line in the sand regarding where ACS will play and where Xerox's current partners will play?
ACS doesn't sell equipment, they sell BPO, so I don't see a reason for concern. Undoubtedly, there may be a few providers that compete in solutions, but our focus is on hardware. Xerox also doesn't expect ACS to be a material seller of our hardware -- I don't even know if they sell hardware.
Do you see any opportunities for Xerox partners to resell ACS services?
It's too early for me to really know if their offerings lend themselves to that. But as we work together, our intent is to continue to take service offerings and create hosted versions for small and midsize companies, just as we've done with MPS for the channel -- our desire would be to have more of that.
Will ACS subcontract business to Xerox partners?
They may. This is still in the very early days, but there's no reason why that would be unusual or surprising.
Is Xerox riding the same wave as Dell's acquisition of Perot Systems as far as buying a services company?
No, there's a big difference. Think of our deal as an infrastructure. There's a layer, and then, sitting on top of that layer is BPO -- claims processes, new accounts, etc. -- that leverages the infrastructure.
Dell is focused on the infrastructure layer -- servers, PCs, storage -- that's not what we're focused on. We'll work with anyone's infrastructure, but we're interested in the BPO that sits on top of that and uses software technology to enhance more automation.