Latest Company to Offer Cloud Services to the Channel: Xerox

By Joseph Walker, Contributing Blogger, SMB Nation

The fourth quarter of 2011 saw executives from IBM, Microsoft, Dell, HP and Cisco all affirming their commitment to the SMB channel and its importance to future revenue growth. Now Xerox has jumped into the fray with three new cloud services for its fleet of VARs and other partners. As Xerox often does, it will rely primarily on channel partners to sell its new services. 

The three cloud solutions are "click-and-pick" easy IaaS provisioning, cloud backup, and disaster recovery. Each service boasts high-performance, high-reliability features (and will be priced accordingly). While Xerox noted that their target market is SMBs, the company's press release specifically mentioned organizations with $10 to $250 million in annual revenue.

Xerox's decision to target that revenue band somewhat puzzles me, as most companies within their indicated range have already made substantial investments in on-premise IT infrastructure. Except in the case of businesses with aging equipment, I would expect IT departments to lean towards hybrid cloud solutions that allow for the easy integration of existing servers with newly deployed cloud ones.

Besides the lack of out-of-the-box integration with on-premise assets, I'm impressed by the new services' spec sheets. The cloud backup solution includes a daily snapshot of each server, for example, and their IaaS product offers compatibility with a wide range of operating systems, including Windows, Linux, AIX, IBM I-Series, Polaris, and HPUX. But I'm curious to learn more about specific businesses they envision using their services. Are there really that many hundred million dollar companies with heavy IT needs ready to completely reinvent their entire tech infrastructure?

One clear advantage Xerox does have is their experience in the VAR market. With the purchase of Affiliated Computer Services in 2010, Xerox greatly expanded its ability to offer channel partners top tier management and integration support.  That may be a boon for VARs and MSPs supporting smaller companies with limited IT expertise, but I have to wonder about how competitively Xerox will be able to price these services.

It will be interesting to see if Xerox can stay competitive in a market where consumers have started to expect enterprise grade solutions for pennies on the dollar.