Xerox 2007 Annual Report Download - page 43

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Xerox Annual Report 2007 41
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, affi liates,
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. Our 2007 DMO goals included revenue growth, a continued focus
on improving the entire cost base and providing a foundation for profi table growth.
Other
The Other segment primarily includes revenue from paper sales, value-added
services, wide-format systems and GIS network integration solutions and electronic
presentation 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 signifi cantly
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 October 2007,
we acquired Advectis, a provider of a web-based solution that electronically manages the
process to underwrite, audit, collaborate, deliver and archive mortgage loan documents.
In July 2006 we acquired Amici, a provider of web-based electronic discovery (E-discovery)
services, primarily supporting litigation and regulatory compliance. Often our value-added
services solutions lead to larger managed services contracts which include our equipment,
supplies, service, and labor. We report the revenue from managed services contracts in
the Production, Offi ce, or DMO segments. In 2007, the combined value-added services
and managed services revenue, including equipment, totaled $3.8 billion.
In our wide-format systems business, we offer document processing products and
devices designed to reproduce large engineering and architectural drawings up to three
feet by four feet in size.