SUN MICROSYSTEMS AWARDS XEROX MULTI MILLION EURO SERVICES PROJECT

Xerox management of Sun’s European print, copy, fax, and multi-function product fleet, delivers ten per cent cost saving in initial stages

Uxbridge, UK and Ballycoolin, Ireland – 21st October 2004 – Xerox today announces it has been awarded a five year, multi million euro international outsourcing services project, by Sun Microsystems. The project will see Xerox assume total responsibility for the management, maintenance, and streamlining of Sun’s entire fleet of printing, copying, faxing and multi-functional products used by the company’s 11,500 total workforce across 119 sites in 31 European countries as well as South Africa. Sun is using Xerox Office Services to reduce printing costs, improve financial administration and service levels as well as boosting its bottom line right across Europe.

Xerox completed an audit of all devices in Sun’s offices, and proposed a rationalisation plan for how to reduce the quantity of those devices and re-deploy them to ensure Sun maximises utility from each individual device. At the same time, Xerox has also taken on the management of Sun’s different European device manufacturers, consumables suppliers and maintenance contracts, as well as assuming sole responsibility for resolving device queries from all Sun employees through its Xerox Global Services support centre in Ballycoolin, Ireland.

“In effect, the initial benefits we’ve seen already are two-fold,” explains Larry Matarazzi, director, Workplace Resources, Sun Microsystems. “Where financial administration is concerned, we’ve gone from having to process over 3,000 invoices per quarter across Europe from all 27 device, consumables and maintenance suppliers, to just one invoice per country per month from Xerox. Secondly, our employees have reported a dramatic improvement in customer service when it comes to device problem resolution across Europe. We set Xerox a target of resolving 80 per cent of issues immediately, but Xerox is actually resolving close to 99.8 per cent, and Sun has already cut its ongoing European print and document management costs by around ten per cent.”

The next step of the project, which has already begun, is the rationalisation of Sun’s device fleet by Xerox. Xerox will continue to deal with every employee query regarding devices – from how to find a printer driver to how to deal with the IT aspects of moving a Sun office to a new site – but simultaneously work to reduce the number of devices that Sun has. In turn, this will reduce the financial burden of the legacy fleet at Sun. In this phase, Xerox has committed to reduce Sun’s print and document management costs in Europe by 25 per cent.

“We have already received dramatic ‘human’ benefits from Xerox’s work in the form of improved morale and better staff productivity,” continues Matarazzi. “In fact, it’s fair to say we started to see the benefit from day one. For the first time we know exactly how many devices we have in these countries. We’re now looking forward to the financial cost savings that will come from having a device fleet and management set-up that will better suit the needs of our European personnel.” Sun is able to make cost savings through using Xerox’s negotiation and buying power for equipment maintenance and other print consumables, as well as increasing productivity and reducing downtime caused by device failure.

“The first part of the project has gone very well from both companies’ points of view,” says Shaun Pantling, director and general manager, Xerox Global Services, Xerox Europe. “As we continue the rationalisation, we will significantly improve Sun’s asset utilisation by increasing the number of users per device from seven to 17 whilst enhancing functionality to increase productivity.”

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NOTES TO EDITORS

About Xerox Europe
Xerox Europe, the European operations of Xerox Corporation, markets a comprehensive range of Xerox products, solutions and services, as well as associated supplies and software. Its offerings are focused on three main areas: offices from small to large, production print and graphic arts environments, and services that include consulting, systems design and management, and document outsourcing.

Xerox Europe also has manufacturing and logistics operations in Ireland, the UK and Holland and a research and development facility (Xerox Research Centre Europe) in Grenoble, France. For more information, visit www.xerox.com.

Xerox®, The Document Company® and the digital X® are trademarks of Xerox Corporation. All non-Xerox brands and product names are trademarks or registered trademarks of their respective companies.

About Xerox Global Services
Xerox Global Services, one of the three main business units of Xerox, offers a broad portfolio of services including consulting and systems integration, imaging, content management and outsourcing. We work with our clients to improve and manage their document intensive business processes - everyday processes like customer communications, billing, training, or records management.

Xerox®, The Document Company® and the digital X® are trademarks of Xerox Corporation. All non-Xerox brands and product names are trademarks or registered trademarks of their respective companies.

About Sun Microsystems, Inc.
Since its inception in 1982, a singular vision -- "The Network Is The Computer" -- has propelled Sun Microsystems, Inc. (Nasdaq: SUNW) to its position as a leading provider of industrial-strength hardware, software and services that make the Net work. Sun can be found in more than 100 countries and on the World Wide Web at http://sun.com

Sun, Sun Microsystems, the Sun Logo, Solaris, N1 and The Network Is The Computer are trademarks or registered trademarks of Sun Microsystems, Inc. in the United States and other countries. All SPARC trademarks are used under license and are trademarks or registered trademarks of SPARC International, Inc. in the United States and other countries. Products bearing SPARC trademarks are based upon an architecture developed by Sun Microsystems, Inc. UNIX is a registered trademark in the United States and other countries, exclusively licensed through X/Open Company, Ltd.