Xerox 2006 Annual Report Download - page 22

We also extended our black-and-white MFD series, broadening our already extensive product line.
– WorkCentre 4118: Introduced in June, the 4118 is designed for small workgroups and has the strongest set of
features that we offer on a low-end, black-and-white desktop MFD.
– WorkCentre 4150: With the introduction in September of this 50 ppm A4 monochrome MFD, we entered a new,
rapidly growing market segment, offering an economical alternative to large enterprises interested in replacing
their printer fleet.
– WorkCentre 4590: Introduced in January, the 4590, which runs at 90 ppm, rounds out the high-end of our office
monochrome fleet.
– Extensible Interface Platform: In October, we introduced our Extensible Interface Platform (“EIP”) with a
configurable user interface. With EIP, customers can access document-related software applications on a Xerox
MFD user interface, improving workflow and productivity.
DMO
DMO includes the marketing, sales and servicing of
Xerox products, supplies, and services in Latin America,
Brazil, the Middle East, India, Eurasia and Central-
Eastern Europe and Africa. In countries with developing
economies, DMO manages the Xerox business through
operating companies, subsidiaries, joint ventures, product
distributors, affiliates, concessionaires, value-added
resellers and dealers. Our two-tiered distribution model
has proven very successful in the high-growth
geographies of Russia and Central-Eastern Europe, and in
2006 we completed implementing this business model
throughout the remainder of DMO. We manage our DMO
operations separately as a segment because of the political
and economic volatility, and the unique nature of its
markets. Our 2006 DMO goals included revenue growth,
a continued focus on improving the entire cost base and
providing a foundation for profitable growth.
Other
Our Other segment primarily includes revenue from
paper sales, value-added services and wide-format
systems.
We sell cut-sheet paper to our customers for use in
their document processing products. The market for
cut-sheet paper is highly competitive and revenues are
significantly affected by pricing. Our strategy is to charge
a premium over mill wholesale prices, which is adequate
to cover our costs and the value we add as a distributor, as
well as to provide unique products that enhance the “New
Business of Printing” and color output.
An increasingly important part of our offering is
value-added services, which uses our document industry
knowledge and experience. Our value-added services
deliver solutions that optimize our customers’ document
output and infrastructure costs while streamlining,
simplifying, and digitizing their document-intensive
business processes. In July, we acquired Amici, officially
launching the Xerox Litigation Services line of electronic
discovery (“e-discovery”) and records management
services. E-discovery is the identification, filtering,
production and storage of relevant data from paper or
electronic documents, like e-mail, text files, memos,
databases, presentations and spreadsheets. Often our
value-added services solutions lead to larger managed
services contracts, including our equipment, supplies,
service, and labor. We report the revenue from managed
services contracts in the Production, Office, or DMO
segments. In 2006, the combined value-added services
and managed services revenue, including equipment,
totaled $3.5 billion.
We offer document processing products and devices
in our wide-format systems business designed to
reproduce large engineering and architectural drawings up
to three feet by four feet in size.
20