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The name Xerox conjures so many images of jumbo photocopiers and retro printers that it can be easy to forget it was once a hub of innovation. In the 1970s the massive company’s tiny Palo Alto Research Center (PARC) developed a graphical user interface, a basic desktop, publishing technology, and Ethernet connections, and assembled those features into the first modern PC. Xerox, of course, approached Apple to help it market the computer and agreed to share its secrets in exchange for a stake in Steve Jobs’s company. Xerox benefited greatly from PARC’s other big invention, the laser printer, but its PC business never took off.

SAP, the German business-software stalwart that’s been struggling to catch up in cloud services, is trying to follow the PARC model. SAP traditionally sold its customers software outright, but for the past few years it’s been pitching them software subscriptions that can be updated automatically through the cloud. The cloud model is cheaper for customers in the short term but much pricier in the long run. Microsoft and Adobe Systems last year successfully persuaded customers to adopt the subscription model after a few rough quarters; SAP hasn’t quite made the transition. On Jan. 20 the German company cut its profit targets through the 2017 fiscal year, which it says will yield €6.3 billion ($7.1 billion) to €7 billion in operating profit, down from €7.7 billion.

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