Xerox Accelerates Color Growth, Taps Solid Ink Technology to Deliver B

Xerox Accelerates Color Growth, Taps Solid Ink Technology to Deliver Breakthrough Multifunction System for Businesses; From advertising to R&D, company gears up to meet demand for color documents

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    Business Editors/High-Tech Editors
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    SAN FRANCISCO--(BUSINESS WIRE)--March 30, 2005--Calling color "a strategic competitive advantage no enterprise should be without," Anne M. Mulcahy, chairman and chief executive officer of Xerox Corporation (NYSE: XRX), unveiled the latest developments in the company's burgeoning color business, including the first-ever office multifunction system based on patented Xerox solid ink technology.
    With the number of color pages in the industry increasing 20 percent per year, Xerox has boosted its color revenue at a similar rate. Now the company is ramping up to colorize an even larger slice of the 3 trillion pages printed annually. Despite strong growth, only 3 percent of the total pages produced in businesses today are produced on color devices. Xerox expects new color technologies and services to drive that number to 10 percent of pages by 2008, fueling a $22 billion market opportunity.
    Speaking before customers, partners and multinational press in San Francisco, Mulcahy urged business leaders to get on board. "Color is no longer a 'nice to have,'" she said. "It's a smarter, more effective way to communicate and add value to information. As of today, color is easier, more accessible and affordable for more businesses than ever before."
    Over the past four years Xerox has completed what Mulcahy called "the first phase of a 'Color Everywhere' strategy" that included the launch of a new color solid ink platform for the office and Xerox's breakthrough iGen3(R) Digital Production Press and DocuColor platforms for the high-end production printing market.
    "Now we are embarking on phase two of that strategy, extending the cost, quality and environmental advantages of solid ink to the multifunction space while increasing the market-proven productivity of the iGen3 even further," she said. "The breadth of Xerox's color portfolio is unsurpassed with 28 color-enabled products, and we will continue to lead in color innovation from the desktop to the print shop."
    A key part of Xerox's color strategy revolves around its solid ink technology, protected with more than 100 current and pending patents and designed to generate billions of color pages and revenue over the balance of the decade. Solid ink technology uses solid, polymer-based ink instead of powdered toner. Its imaging process works similarly to an offset press but is designed for everyday office use.

    Colorful rollout

    Starting at $2,999 and printing at 24 pages per minute in color and black-and-white, the Xerox WorkCentre(R) C2424 color multifunction system announced today is 30 percent to 60 percent more affordable and twice faster than leading comparable products in its class. In addition to being the industry's first solid ink multifunction product, it is the first Xerox color MFP to be broadly distributed through value-added resellers, helping Xerox reach more small and medium-sized businesses in addition to large companies.
    Xerox simultaneously announced enhancements to its DocuColor 12 color copier/printer - its best-selling color MFP to date with over 60,000 units shipped.
    These new color offerings, coupled with the introduction earlier this month of the faster and more powerful Xerox iGen3 110 Digital Production Press, reflect Xerox's proven ability to innovate and lead in digital color printing for small businesses, large enterprises, the graphic communications market, and beyond.
    InfoTrends/CAPV, an independent market research firm, projects that U.S. office and production color unit placements will more than double over the next three years. I.T. Strategies predicts that by 2007, annual worldwide spending on digital color output by businesses and consumers will hit almost $50 billion.
    "With revenue per color page five times greater than revenue per black-and-white page - and with research that shows color documents sell up to 80 percent more effectively than black-and-white - color creates new business opportunities for Xerox and our customers," Mulcahy pointed out.
    During today's announcement event, panels of color experts and customers cited ways in which color documents are helping businesses, from tanning salons to major credit-card companies, to thrive by better communicating with their customers. Representatives from education, design and the arts cited ways in which new digital color technologies are adding value to everything from classroom textbooks, direct-mail pieces, tax forms and 401(k) statements.

    Across-the-board support for color

    Xerox is backing its color initiative with a multimillion-dollar color advertising and marketing campaign. Building on its brand advertising efforts, the company recently launched a color-specific ad campaign including print ads in major business publications as well as online and television media. The new campaign features vibrant images and striking headlines with the tagline "Xerox Color. It Makes Business Sense."
    Xerox has marshaled its unsurpassed research and development resources to pursue future color innovation. Xerox and its partner Fuji Xerox are jointly investing about two-thirds of a combined $1.5 billion annual research and development budget on color. Over the last decade, this investment has resulted in more than 2,700 color-related patents.
    Xerox is also applying its professional consulting services, customer communications and design expertise to help businesses re-engineer documents to improve response rates and generate new business. More than 100 companies and organizations are currently relying on Xerox Global Services experts to add the value of color and intelligent design to business-critical documents.
    Since the start of Xerox's "Color Everywhere" strategy, 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. Color revenue is expected to grow at about the same rate in 2005.
    Xerox's color offerings include network printers, multifunction systems, digital copiers, highlight color printing systems, wide-format printing devices, and digital presses, ranging from 5 ppm to 180 ppm and priced from $499 to more than $580,000.

    Customer Contacts:

    For more information about Xerox color systems and services, visit www.xerox.com or call 800-ASK-XEROX.
    NOTE TO EDITORS: For more information about Xerox, more details about today's announcements and for photography, visit www.xerox.com/news. XEROX(R), iGen3(R) and WorkCentre(R) are trademarks of XEROX CORPORATION.

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CONTACT: Xerox Corporation, Media: Edward Gala, 585-423-5230, edward.gala@xerox.com Bill McKee, 585-423-4476, bill.mckee@xerox.com

KEYWORD: CONNECTICUT CALIFORNIA NEW YORK INDUSTRY KEYWORD: HARDWARE PUBLISHING ADVERTISING/MARKETING SOFTWARE PRODUCT PHOTO PHOTOWIRE SOURCE: Xerox Corporation PHOTO: 42538

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