Xerox Shows Off Its True Colors

Throwing its considerable weight behind a widespread move toward color printing, Xerox used a quirky, flashy media event in San Francisco recently to underline its commitment to color, including the release of what it calls the industry's first office color multifunction system with patented solid-ink technology.

The strategy has long been in the works among Xerox and its competitors, but the technological advancements around it may force resellers who focus on toner to start modifying their businesses. Xerox chairman and CEO Anne Mulcahy called the shift to color an inevitable and potentially lucrative move for the printing industry.

"One-third of the products we launched in the past year were color," she says. "We're on track to make all our products color-enabled, while continuing to serve the needs of our monochrome customers."

Mulcahy says the company's "Color Everywhere" strategy is about realizing the advantages color can provide in selling, marketing and improving everyday business.

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"'Color Everywhere' is not just a statement of strategy; it's also a statement of belief in the power color has to be a more effective way to communicate and add value to information," she says. "We're injecting color into every aspect of our business and bringing it to every customer we serve."

The number of color pages printed in the industry currently is increasing 20 percent per year, at about the same rate at which Xerox has increased its color revenue. Still, only 3 percent of the total pages produced in businesses today are on color devices, though Xerox projects new color technologies and services to push that to 10 percent of pages by 2008, making it a potential $22 billion market opportunity.

Market research firm InfoTrends/CAP Ventures, based in Weymouth, Mass., supports that statistic, projecting that U.S. office and production color-unit placements will more than double during the next three years. IT Strategies predicts that by 2007, annual worldwide spending on digital color output by businesses and consumers will hit almost $50 billion.

Xerox aims to capitalize on that growth. The company says its new WorkCentre C2424--the first Xerox color multifunction printer (MFP) to be broadly distributed through resellers--is 30 percent to 60 percent more affordable and has color speeds twice as fast as leading comparable competitive products in its class. Starting at $2,999 and printing at 24 pages per minute in color and black-and-white, the device scans at 20 images per minute, has a first color page out time of 6 seconds and has a first color copy out time of less than 15 seconds. Solid-ink technology uses solid, polymer-based ink instead of powdered toner, working much like an offset press but designed for everyday office use.

The absence of powdered toners, liquids, tanks or cartridges makes the machine easier to use and more environmentally friendly than legacy printers; it's this solid-ink technology that may force some resellers to rethink their toner sales and support.

Xerox has been working on parts of its Color Everywhere strategy for the past several years. Most recently, that included the launch of a new color solid-ink platform for the office and the iGen3 Digital Production Press and DocuColor platforms for the high-end production printing market.

Xerox is backing its color initiative with a large advertising and marketing campaign, and the company is combining with Fuji Xerox to jointly invest roughly two-thirds of a combined $1.5 billion annual research and development budget on color. During the past decade, this investment has resulted in more than 2,700 color-related patents.

Since the start of Color Everywhere, the company has seen color revenue rise from 16 percent of total revenue in 2001 to 25 percent in 2004. Xerox's color business amounted to $3.9 billion in 2004, a 20 percent annual increase, and is expected to grow at about the same rate in 2005.

Xerox also used its media event to launch three other office systems: CopyCentre C118 black-and-white copier, WorkCentre M118/M118i black-and-white basic multifunction systems, and the EFI Fiery X12e controller for the Xerox DocuColor 12 color copier/printer. Both MFPs are designed for small to midsize workgroups that require copy, print, scan and fax functions; the DocuColor 12 was introduced in 1999 with print quality that has attracted a loyal following in the graphic-arts space, making it Xerox's best-selling color MFP with more than 60,000 units shipped.

Finally, the company introduced a new transfer paper, targeted at quick-print shops, commercial printers and office store print centers, that enables images and text to be transferred to items such as T-shirts, tote bags or mouse pads.