NEW YORK, May 1, 2001-- Xerox Corporation (NYSE: XRX) is leveraging its $3.5 billion outsourcing business and rapidly growing solutions and professional services units to pursue an estimated $100 billion market opportunity. These offerings, coupled with its focus on "non-paper-related" opportunities such as Web-based document solutions, consulting and network services will become a major source of revenue for Xerox as it evolves to meet customer demands. Speaking at an industry consultant meeting in New York today, Anne M. Mulcahy, Xerox president and chief operating officer said that Xerox is "building a focused portfolio of solutions and people-based services to help customers work smarter." Mulcahy said Xerox will support its solutions and services expansion as part of a turnaround plan that includes $1 billion in cost reductions and $2 to $4 billion in asset sales and related cash generating initiatives. "Our investments are shifting as we take cost out of our business and redirect resources to high-growth areas like solutions, services and color," she said. Xerox's solutions portfolio builds on the success of its existing technology and addresses specific customer needs such as one-to-one marketing, electronic bill and statement presentment, and print-on-demand. Xerox's industry-focused solutions business experienced strong double digit growth in 2000. The company has invested $100 million in solutions research, and capabilities in addition to its core technology development. Xerox's new service offerings complement its recurring revenues from document outsourcing, growing about 20 percent a year. This growth rate is expected to accelerate with a strong portfolio of services such as business process consulting, systems support, network integration and e-Services. Xerox's new e-Services Business offers secure Internet-based hosted services for imaging and information management, e-learning, and marketing and sales communications. Recent customer contracts in this area include McGraw Hill and Enterprise Rent-A-Car. Xerox Connect, a 1400-employee consulting and integration business, will continue to deliver a range of professional services across North America on-site, off-site or virtually. In Europe, Xerox is offering advanced consulting services through Xerox Industry Solutions and Services (XISS), which has doubled its revenue and grown from 150 people to about 800 people over the past two years. Mulcahy concluded her remarks by stating, "Xerox has the brand, technology and the customer relationships to move beyond the box. Solutions and services are the key planks that will enable us to execute this strategy."