Zacks_Analysts' Blog : Xerox, Cisco Form Partnership - Analyst Blog

Xerox Corp. (XRX) and Cisco Systems Inc. (CSCO) have recently entered into a partnership that will enable the latter to use and offer the former’s cloud computing and print products and services on its network equipment. This will enable Cisco to offer more services to its clients, such as telecommunications providers and other large organizations.

The new deal is expected to broaden Cisco’s services and hardware portfolio, thus enabling it to compete with its strong competitors namely Juniper Networks Inc. (JNPR) and Hewlett-Packard Company (HPQ).

Cisco Systems Inc. is one of the leading networking equipment makers based in San Jose, California. The company designs, manufactures and sells Internet protocol (IP)-based networking and other products related to the communications and information technology industry to many of the giant corporate clients of the world.

Apart from Xerox, Cisco has strategic alliances with a bunch of globally known companies including Accenture plc (ACN) , AT&T Inc. (T), Intel Corporation (INTC),  Microsoft Corporation (MSFT),  Nokia Corporation (NOK) and Wipro Limited (WIT).

However, Cisco has been finding it tough for quite some time. This has forced the company to shut down some of its underperforming units, such as the Flip camera, and is focusing more and more on its core businesses that offer networking and routing equipment.

According to Cisco, the tie-up will not only benefit itself, but also its resellers or companies that sell Cisco's products to businesses. Cisco is largely dependant on its resellers to sell its networking gear to companies and the more profit these partners can bring in, the more products they will demand from Cisco.

Not only Cisco, Xerox also views this joint effort as a big business opportunity. Xerox will also sell Cisco's cloud computing technology to its clients, which helps companies store their data at remote data centers that can be accessed over the Web.