Monday, December 31, 2007

Looking back on 2007 -- iPhone Printing


Reflecting back on all the news from the printing and imaging industry in 2007 is a bit overwhelming. In my recent post (and Hard Copy Observer print column) about the Amazon Kindle, I summarized a few of these important hardware developments in the opening paragraph.

But one of of my most popular posts of the year, based on search results and keyword analysis, was my July 19 entry entitled "iPhone Printing". That post, and a few follow-ups, has been a consistently popular Web destination, which tells me there is definitely a demand for printing from the iPhone. Unfortunately, that post offers no solution for the unmet user need to print from an Apple iPhone, just relates the possible opportunity. Later in the year, I went back and forth with HP and their Print 2.0 blog, where Patrick Scaglia offered the promise of HP's Cloudprint solution, which promised a way to direct previously created documents to local printers, but not the kind of quick on-demand iPhone printing that others may have in mind.

So I'll make it a 2008 resolution to spend at least a bit of my time (and space in this blog) to champion the cause, for iPhone users like me to be able to get at least a quick print solution for the iPhone, and also check in on the HP Cloudprint solution that seems to have remained rather dormant since the company's flurry of activity in August/September.

Friday, December 28, 2007

Observations: Amazon's Kindle Stirs Up E-book (and Printing and Imaging) Excitement

Amazon's Kindle Stirs Up E-book (and Printing and Imaging) Excitement

As readers of the year-end issue of The Hard Copy Observer [where this column appears in print form] can no doubt attest, 2007 has been a very big year for the printing and imaging business. The promises of newcomers like Zink and Memjet and new product categories as represented by HP's Edgeline have been exciting to cover. Innovation outside the purely technical, including the formidable challenge to the razor-and-blades business model mounted by players like Kodak and Xerox, have made 2007 a year to remember. Nonetheless, the pinnacle of tech-industry buzz seems to still be reserved for products and services tangential to printing (at best), with Amazon's Kindle, introduced on November 19, as the latest example.

Earlier this year I was quoted in a Printer Pundit interview on the DataBazaar blog as describing our industry as "quietly going about our business", a comment that was stated frankly but also with a spirit of pride. Yes, we do great things in this business and have hundreds of millions, if not billions, of satisfied customers, but we are the strong, silent types, right? But truth be told, this stealth approach can sting a little in vain moments—after all, among all the 2007 announcements mentioned in my opening paragraph, only Kindle graced the cover of Newsweek magazine.

So, in an unapologetic attention-getting move, I am claiming the Kindle as one of our industry's own. Electronic book readers are not new after all, and many of our business's leading companies have covered, discussed, and even invested in these devices. Since at least 2000, the Observer has covered various E-book readers and related products (e.g. see Observer 3/00). As one of the principal ways we use printed paper in our society, books are of great interest to the printer-oriented world, and in Kindle's case, as noted in its voluminous press coverage in both the traditional and "new" media, the content solution offered by Amazon goes beyond books to include a selection of newspapers, magazines, and blogs. Even considering e-books primarily as a threat that have the potential to someday supplant the need for the physically printed page, these devices are undeniably an important developing area in the broader "information collection, dissemination, and consumption" industry, and serve as a caution to avoid falling victim to marketing myopia and think about ourselves as "just being in the printer industry."

And, in keeping with my ongoing theme of marketing successes and failures, I would like to point to what I believe Amazon has done right on the "product" side. For all the attention it has garnered, much of the Kindle commentary has been rather negative, starting with its retro (to be kind) industrial design. On the positive side, Amazon has put together an innovative solution. We learned from the iPod/iTunes example earlier this decade that cracking an industry, the portable digital music industry in Apple’s case, was not just about the gadget. As the E-book is about so much more than the reader itself, there are definitely some parallels.

The Kindle solution could not do better than Amazon's e-commerce infrastructure for its online bookstore, and the Whispernet connectivity seems to solve the Wi-Fi hot-spot problem I have encountered with my iPhone (and its AT&T Edge network backup that has been roundly criticized as inadequate). The resulting stand-alone nature of the Kindle (no PC required) is a big plus in terms of usability and convenience compared to 2006’s Sony Reader. Closer to our printing world, Amazon had the foresight to include the handling of user-generated documents like PDFs and Word files along with books, newspapers, magazines, and blogs, which are added to the Kindle's memory via e-mail. (Conversely, the Kindle's inability to print snippets of books and other files is one of the knocks on it that reviewers have highlighted.)

By staying away from engineering a multi-purpose laptop-PC wannabe, Amazon seems to have nailed the design for a dedicated reading appliance that includes a monochrome, e-ink-based display and limited graphics but weighs in at well below one pound (10.3 ounces, to be exact). Of course, behavioral patterns will have a huge impact on market success in the end, and the battle still rages between dedicated (and thus multiple) specialized devices and convenient (but compromised) all-in-one machines.

To complete the marketing analysis, the Kindle has a fairly reasonable pricing scheme, including an acceptable price for the machine and aggressive prices for best sellers (though customers may soon tire of the nickel-and-dime scheme of paying for blogs and e-mail). The Kindle also benefits from the ultimate "place", i.e. distribution channel, as Amazon is one the one of the world’s most heavily trafficked and most popular e-commerce sites. So with the great promotion (including the PR blitz) still ongoing and attention to product, make that solution, details, I predict success for Amazon’s Kindle, and welcome it to our larger printing and imaging family!

Wednesday, December 19, 2007

Was 2007 the year of Web-based Apps, or not?

In the interest of expanding a bit beyond my usual printer industry beat, keeping in mind that other forces in the tech universe actually drive what we print, I highlight a great blog post from the other day from one of my favorites, ReadWriteWeb.com, entitled "Consumer Apps: 2007 Year in Review". A later post at the same site, along with another very insightful one from one of my other favorite blogs, Techdirt, drills down on the recent "disappointing" survey results on awareness and adoption of Web-based office applications, most notably Google (NASDAQ GOOG) Docs.

As regular readers will recall, I've been interested in this area, especially when it comes to their abilities (or lack of abilities) in printing (for an example of my analysis and light-touch review see, most recently, "Web-based Application Printing -- Google Presentations".)

I agree with Mike Masnick at Techdirt and Marshall Kirkpatrick at ReadWrite, in that mounting a bona fide campaign to truly compete, market-share-wise, with Microsoft Office will take years and years, and those "disappointing" takes on the data are from the impatient and naive (and I've been known to be both, myself, from time to time!)

See "The Death Of Online Office Suites Is Greatly Exaggerated" and "First, Put Your SKU in a Box: Will Web Office Apps Ever See Widespread Adoption?". Highly recommended!

Monday, December 17, 2007

Looking back, looking forward

As the year winds down, it's natural to look back over a very momentous 12 months in the printing and imaging industry. So over the next two weeks, I'll be highlighting some of my thoughts on what developed in 2007, and then offer some views, my own and those of others, on what's coming in 2008 and beyond.

In this light, a great piece is available at Eweek.com by M. David Stone looks at "The 20 Most Interesting Printers of 2007". Regular readers may remember I wrote a post pointing to this piece back in November. Now, a companion piece of the more forward-looking variety is available, entitled "10 Up and Coming Technologies That Will Change Printing". Here, David looks at many of the industry's breakthroughs enabling the mainstream of printers and printing (like Memjet, HP's Edgeline, Xerox's solid ink, etc on the device side and ink and paper systems on the supplies side) and also some break-out areas outside the conventional mold like Electronics and 3D Printing.

Highly recommended!

Wednesday, December 12, 2007

HP Printers -- numbers and trends tell the strategy story

HP (NYSE HPQ) held their Securities Analyst meeting yesterday and the content of just one of the slides from the printing and imaging portion of the show is worth highlighting here.

The four market areas include Consumer, Small and Medium Business, Enterprise, and Graphics Arts.

Two fascinating conclusions I take from looking at just this one set of numbers and market trends?
1) Consumer is the smallest market (not that $24 Billion should really be considered small) with also the smallest growth rate.

2) All the "dynamics" are consistent with a similar chart that could have been used five, or even ten years ago in some cases -- emerging markets, analog to digital transformation in graphics arts, copier and printer convergence in the office, digital photos and web content in the home? Are these all long-established trends that may be finally transitioning from talk to action?

Monday, December 10, 2007

HP continues growth-through-acquisition strategy with NUR Macro


This morning HP (NYSE HPQ) announced another acquisition in the industrial wide-format space, this time Israel-based NUR Macroprinters. This is HP's second deal in three months in the space (see "HP Acquires Macdermid ColorSpan"). NUR, by the way, is not an acronym, but rather comes from the name of company founder Moshe Nur.

Today's HP "Newsroom" landing page features the NUR acquisition headline and link along with a product shot. And while the MFP pictured is "big iron" for much of the desktop-printer-oriented community, me included, it doesn't hold a candle in size and scale to the NUR printers, an example being the photo at the top of this post, the Expedio.

CompUSA to close

Announced at the end of last week, the remaining CompUSA retail stores, as well as its ecommerce presence, will be closing after the holidays. It's the end of an era in PC and Printer retailing, for sure, but opinion around the Web (e.g. see "CompUSA is closing for good. Good.") seems to weigh against the retail chain and its customer-unfriendly approach.

Friday, December 07, 2007

Direct Marketing, aka "junk mail", good for printers, if it lasts

Christopher Hinton has a piece on Marketwatch (see "Junk mail spurs growth for top printer makers") that highlights positive developments in the Direct Marketing field that mean good news for printer companies like Xerox (NYSE XRX), Kodak (NYSE EK), HP (NYSE HPQ), and Ocè (NL:35493). The surge in direct mail advertising (annual rate of 6% in the US) is spurred by growing capabilities in personalization (and its resultant increase in advertising response rates), as well as the declining effectiveness (e.g. TV advertising) or legal restrictions (e.g. telemarketing) of alternative ad media forms.

Not all bodes well for the future of junk mail, however. An example of forces aligned against direct marketing mailings comes from right here in my home state. Last month, The University of Idaho announced that in a move to save cost, energy, and landfill space, their faculty, staff and students won't receive bulk mail through the university system, as of January 1, 2008 (see "University of Idaho vows to quit delivering junk mail"). Instead, the material will be bulk recycled!

Wednesday, December 05, 2007

In the book scanning business, is this considered a typo?

In these days of Google's (NASDAQ GOOG) sky-high stock price (back within a whisker of $700 today) and ubiquitous presence in the high tech world, it's sometimes easy to fall into ascribing omniscient powers to the company. But they, like all others, are not beyond the occasional mis-step, however minor. Their Google Books (nee Google Print) program, has been quite controversial in the book publishing world, and has been something I've been following for some time, thinking it's a story worthy of a printer-industry-oriented "observations" one of these days. Well, this is not that day, but the little snippet found at reddit.com this morning is worth noting, again, if only to remind us all of the old saying, "we all make mistakes". The whole link, to the photo and entire book entry, can be found at "Google must have been in a rush to digitise this book".

(Interesting footnote -- the Wikipedia entry for Google Books contains a very similar, but different, page sample from 2006.)

Tuesday, December 04, 2007

Lexmark on "Green Printing" for Small Business

In an interesting press release picked up by CNN.com, Lexmark (NYSE LXK) is advising Small Businesses on how to be friendly to the environment when it comes to printing. Combining two of 2007's most-discussed printer industry topics, Small Business printing and "Green" initiatives, Lexmark summarizes the usual supplies recycling tips (which, when presented by the cartridge manufacturers, the options always seem to ignore returning those empties anywhere but to themselves -- wink, wink).

But the company also includes the idea of actually printing less (or at least only printing what's needed). Their advice to use "duplex" is nothing out of the ordinary, but going the "print preview" route to avoid printing unwanted pages mirrors the somewhat more automated Xerox (NYSE XRX)/GreenPrint combination I blogged about last month (see "GreenPrint, Xerox Solid Ink printers get together").

Maybe we in the printer business will eventually clear ourselves of the accusation that those unwanted pages are a supplies-industry conspiracy!

Thursday, November 29, 2007

HP's Green Office

Tech news yesterday included the announcement by HP (NYSE HPQ) of a huge "green" project (see "Hewlett Packard to install large solar power array"), to be installed at the company's San Diego site, which has always been and remains one of the major Imaging and Printing sites around the company. The "green" emphasis also was also very prominent at HP's recent ImagePrint 2007 conference I attended in Phoenix (see "Live Blogging HP's ImagePrint 2007", where central to the large product/solution showcase at the event was the "Green Office" exhibit. HP, led by their "green printing guru" Dave Lobato. HP's emphasis on printer-specific green features like reduced power consumption and recycling of supplies was complemented by the display itself, which used standard office fixtures like chairs, counters, cabinets, even the flooring and more, all made from recycled materials. It was a cleverly executed and popular stop at the showcase (see photo).


And in another green-related communications initiative (and also playing at the ImagePrint event), there's a video on YouTube, inspired by TV's "The Office", that if nothing else highlights the many ways to be green. While Xerox (NYSE XRX) has been lobbing shots at HP on its relative advantage in the lack of landfill-destined waste associated with its solid ink supplies versus HP's alternatives, the video follows other HP missives in firing back on the power-consumption issues that go with along with the solid ink technology.

All I want for Xmas is...a wireless inkjet printer?

I've been working with a Lexmark (NYSE LXK) Wireless X6570 inkjet all-in-one, and included my recent experiences with the product's wireless printing capabilities in my November Observations (see "Wi-Fi Printing -- Look Ma, No Cables"). So I was particular interested to see the story in this morning's news about a marketing research study, sponsored by Lexmark, and conducted by MarketTools last month among an online panel of 1,000 computer users.

As I've blogged about a number of times, commissioned research is great for learning things, often mostly about the sponsor's marketing goals! And keep in mind the results will be released pending their usefulness in furthering those goals. Nonetheless, the results as well as trying to ascertain the "story behind the story" can both be very interesting! Here are some of the results from this one:

When asked to list the top three technology products that they do not currently own, but would like to own, the largest number of respondents, 618, named wireless printers to their top three list. A flat-screen TV was selected by 565 respondents, and camcorders were selected to the top three list by 451 respondents.

In terms of absolute placement within the top three, flat-screen TVs were mostly frequently selected first (52 percent), wireless printers were most frequently selected second (41 percent), and camcorders were most frequently selected third (30 percent).

Only 6 percent of respondents said they already own a wireless printer.

More than eight out of 10 respondents (84 percent) said they would consider a wireless all-in-one (AIO) printer a great gift, and five in 10 (52 percent) said they would consider giving a wireless AIO as a gift.

Tuesday, November 27, 2007

Kindle Printing

Regarding the Amazon (NASDAQ AMZN) Kindle e-book reader announced on November 19th, I'm working on a column for my December Observations that will include historical perspective, and potential impact on the printer industry. So in researching that piece, I've come across a couple of relevant items worth highlighting here, ahead of my December column which will appear around the middle of next month.

Andrew Sullivan, in "Reviewing the Kindle" at The Daily Dish at TheAtlantic.com forwards an idea, as a fan of small, fast, compact printers:

What I'd buy is a small printing device that can download any book and print it out in a classic simple paperback style: a consumer-friendly print-on-demand.

Rob Enderle, in "The Rise of ePaper: Could Kindle Represent the End of Printing?" on his blog at ITBusinessEdge.com, beyond some good commentary on the Kindle itself, offers the idea that this could be the beginning of the end for printing. He asserts interesting arguments about our (printer) industry that speak to its mature status, seeing low (single digit) sales growth but high profits at least for the dominant player, HP (NYSE: HPQ).
In short, this has the feel of a business that has peaked and is in the process of being replaced by something else.

More on Lexmark's Wireless X6570 All-in-One

I wrote my November 2007 column, from a mostly user's perspective (see "Observations: Wi-Fi Printing -- Look Ma, No Cables"), exploring the emerging "standard" wireless interface on many of today's new printers. I used a Lexmark (NYSE LXK) Wireless X6570 All-in-One as my subject device, and found its printing capabilities to be more than satisfactory.

Since finishing the column, I've continued to use the Lexmark AIO, and recently found a post "Berlind's Testbed" blog from ZDNet's David Berlind on his experiences with the same all-in-one (see "HP, eat your heart out. At $150, Lexmark’s WiFi All-in-1 printer/copier/scanner/fax got my cash".) David's post contains an interesting account of his purchase of the Lexmark product, including receiving surprisingly knowledgeable help from his local Staples store. And like me, he found the Wi-Fi's biggest benefit to be location flexibility. (The basement-based Linux print server he replaced also rang true!)

Although I wasn't out to perform a full-scale review on the X6570, I still avoided reading other reviews before my own hands-on experiences with the products, in order to maintain my objectivity. After the fact though, it's good to see someone else's similar experiences. This includes my post-column work with some of the product's other functions, including successfully copying and scanning using the all-in-one's OCR capabilities. I recommend the Berlind post from earlier this month, including the up-to-now 24 comments, which (not surprisingly) run the gamut of pros and cons on everything from Wi-Fi itself to ink usage and color print quality.

Thursday, November 22, 2007

Happy Thanksgiving

And have a great Black Friday!

To my US readers, have a great holiday and don't forget to support our economy and get out there tomorrow and SHOP! I don't follow all the great tech bargains here (see my favorite, the appropriately named TechBargains.com for that), but among the deals worth noting including the Samsung CLP-300 color laser printer for a heretofore unbelievable $99.99 at several of the big box office stores!

Tuesday, November 20, 2007

Live from New York...

Well, at least that's probably where most of the analysts were, on the HP (NYSE HPQ) earnings call yesterday afternoon, following the market close. HP discussed its generally great revenues and earnings, including surpassing IBM in the long-discussed but seemingly insurmountable goal of becoming the #1 technology company on Earth (though no mention of this milestone was uttered by the company), and then reviewed some of the underlying details and took some Q&A. From the transcript, here are the printer-related remarks with my comments in [brackets]:

[from the narrative portion of the call]
Cathie Lesjak - Hewlett-Packard - CFO
Drilling in on the performance by business segment, during the fourth quarter, imaging and printing revenue grew 4% year-over-year to $7.6 billion, with supplies revenue growth of 6% and commercial hardware revenue growth of 5%. Consumer hardware revenue declined 5% year-over-year primarily due to the declines in appliance printers and cameras. Total printer hardware units were up 5% year-over-year.

This growth is slower than recent periods reflecting our decision to be more disciplined in our pricing of appliance printers and a tough prior year compare. Excluding appliance printers, total printer hardware units were up 9% year-over-year. In the consumer business, printer units were up 3% from the prior year lead by solid all in one unit growth. In the commercial business, printer hardware units were up 15% year-over-year lead by color laser printer shipments up 17% and printer-based MFP shipments up 26%.

In the fourth quarter, IPG delivered solid operating profit of $1.1 billion, or 14.5% of revenue including a charge of $32 million reflecting changes in the camera business model. This change in our camera strategy will have unfavorable impact of approximately one percentage point on IPG revenue in FY '08. Going forward, you will see us strategically taking out costs and realigning resources to build on our core business and accelerate our investments in growth initiatives.

[first question out of the chute]

Laura Conigliaro - Goldman Sachs - Analyst
Great. Well, starting with printers, printer unit growth has been coming down pretty noticeably over the past three quarters and supplies growth too. You've got another hard compare in the Jan quarter suggesting another mid-single digit unit growth rate in another weak supplies growth rate. How should we be viewing growth in these categories after that, and since you have been working at trying to separate supplies growth from unit growth, at what point might we start to actually see some benefit from that without the help of much incremental hardware unit growth?

Mark Hurd - Hewlett-Packard - Chairman, CEO & President
Hi, Laura, Mark, I'll start.
First, I think good question. I think we're pretty comfortable with mid to high single digit supplies growth and I think that favorably helps our business model. We're also comfortable with sort of mid-range, mid-single digit unit growth. To your point, we gained a heck of a lot of share coming off of a pretty rough 2003, 2004, and we're also being picky about the categories we're competing. Some of the areas as Cathie noted in the appliance-printer area , we're not seeing the supplies connect rate that you might want and so therefore, we're putting our money into areas that we think give us better connect, so we feel pretty comfortable with where we're headed.

Cathie also mentioned that if you actually took out the appliance growth rate on units and then looked at the core Inkjet and LaserJet, we had a pretty healthy unit growth rate in the quarter, certainly comparable to what we've seen in other quarters over the past two and a half years. So, I think you should think about those rates. If we get into those levels which we feel good about, we'll get favorable treatment in the business model, we feel good about that and we're continuing to be very tough in this IPG 2.0 transformation to be very focused on making sure that we look at every piece of the business and look at the value it brings so that we go to the real core places that we think we have opportunity to improve the business which is what you saw in the camera business model decision that we described.

We're also working very hard, Laura, and I don't mean to be too verbose with this but I want to make sure I give you a clear answer to this, we worked very hard to ensure that we have channel alignment on supplies inventory relative to the hardware opportunity during the quarter as well so it's really all of those dynamics tied up together and net-net you saw that if you took the camera charge out, IPG profit improved during the quarter, so we feel pretty good about our opportunities here but we still have a lot of work to do.

Monday, November 19, 2007

HP's Year End 2007 Printer Metrics

HP (NYSE HPQ) released its fiscal-year-end earnings after the markets closed today and logged some impressive numbers, including a $28 Billion revenue quarter, putting the company's annual total revenues at a once-unthinkable $104.3 BILLION!

Some of the Printing and Imaging numbers were released (with some additions included in the slides from the conference call, compared to the release linked to above), and conforming to this blog's tradition, they are presented below. IPG tallied record revenues as well, but with the some of the supporting numbers somewhat mixed. The narrative on the call blamed digital still camera and appliance printers for the decline in consumer hardware units.

Google Magazine

On the day Amazon (NASDAQ AMZN) is announcing its Kindle e-book reader and infrastructure, another Web company (well not exactly just another Web company!) is being associated with an "old media" category if in a much more speculative fashion. TechCrunch's Michael Arrington blogs about "Google Magazine", particularly a patent claimed by Google (NASDAQ GOOG) in 2006. Interesting thoughts on Google's interest on custom-content magazines including personalized ads.

Back to Kindle, TechCrunch is one of the 200 blogs that will be available for subscription, and is also live-blogging today's Amazon Kindle announcement.

Amazon's Kindle -- more than meets than eye!


Today Amazon (NASDAQ AMZN) announced its Kindle e-book reader, which may remind long-time printer industry participants of numerous noble but ultimeately unsuccessful attempts at electronic book-reading appliances over the year. A quick look at the coverage (and photos), for example at Between the Lines, will bring back memories of past efforts. BUT...before focusing too much on the hardware/product specficiations and characteristics, look at the whole "ecosystem" Amazon has put into place, with its Kindle store, subscriptions to newspapers, magazines, and blogs, links to Wikipedia as well as The New Oxford American Dictionary. In my opinion, this changes the "e-book" equation, and makes ultimate success seem much more likely, especially when viewed with the rather obvious analogy of iPod/iTunes.

Saturday, November 17, 2007

Observations: Wi-Fi Printing -- Look Ma, No Cables

Wi-Fi Printing -- Look Ma, No Cables

Baby boomers like me might remember the original reference for my column title, which I believe is from a late 1950s/early 1960s Crest toothpaste television commercial featuring a kid riding a bike and showing off to his mother. But the phrase became adapted and re-used so many times that what may have seemed clever adaptations to the creators became tiresome to the listeners in a hurry. (Today’s variation, which is becoming equally tiresome, is (fill in the blank) 2.0).

But I am not just using that title phrase for nostalgia, although that is a factor. I am using it to point to a major question that I have had over the last year or so: Do the wireless interfaces that have become so prominent on new consumer printers really serve a legitimate and growing customer need, or is wireless merely the latest battleground in the "specsmanship" wars that also drive our industry, but in an ultimately less important way?

Let me go back a few years to the introduction of the HP (NYSE HPQ) LaserJet 5P and 5MP laser printers (see The Hard Copy Observer, 3/95). I was around for the conception of that product line and worked with the design team to come up with a feature set that would continue the HP LaserJet's legacy of innovation and customer satisfaction. The inclusion of a wireless interface, in this case infrared (IR), took advantage of HP’s investment in research and development in this area and served as a visionary lighthouse—a statement of direction towards a future where clumsy, space-limiting, unaesthetic, and otherwise troublesome wires would be rendered obsolete and replaced in a cable-free world with PCs and peripherals harmoniously getting along over the ether.

In reality, the adoption of infrared was hampered by a number of limitations: users had to acquire print drivers from a third-party developer, the maximum distance between the IR-equipped computer and the printer was limited to three feet, and the current version of Microsoft Windows did not support IR printing. As a result, very few end users at the time actually used wireless printing.

Fast forward to 2007. Broadband Wi-Fi networks abound, and millions of users around the world routinely gain Internet access by logging into Local Area Networks (LANs) based on 802.11 standards. These networks are in work environments and public places like airports and coffee shops and are today's technology of choice for millions and millions of home-based LANs. And the printer industry has taken notice.

I personally have had a Wi-Fi-equipped home office for four or five years using a variety of off-the-shelf technologies. In our home, like most, the primary motivation is sharing the Internet "pipe" that comes in to our home via a digital subscriber line (DSL) modem (but that could just as easily be a cable modem). Over time, my family and I have begun sharing other resources, like files and printers, but until recently, in a more traditional network-printing fashion.

Lexmark (NYSE LXK), while by no means having a lock on the Wi-Fi printer market, has been at the forefront in touting Wi-Fi compatibility for its printers. Despite recent financial woes (see "Lexmark Can't Match Apple Results"), Lexmark continues to be a strong industry player and, in fact, is known as an organization with long-standing expertise in pursuing printing's vertical markets, which is another way of saying that the firm identifies segment-specific user needs and designs products and solutions for those needs. So a look at Lexmark's approach to Wi-Fi printing seems appropriate. The company is so enamored with wireless printing that it has made the term part of its product names. For example, the product they made available to me for some light-duty testing is the Lexmark Wireless X6570 All-in-One. The firm’s positioning is realistic—they do not dispute that there is more than one way to print over a network—but enabling the printer to become a full-fledged citizen of the wireless LAN has some distinct advantages.

In the document "Understanding Your Wireless Printing Options" (available at http://marketing.pcworld.com/campaigns/lexmark/printing-options.html), Lexmark points to "wireless printing anywhere within your wireless network — giving you more mobility and reducing cable clutter" and "the freedom to place your printer almost anywhere in your home—you decide based on what suits your usage preferences and décor, with no worries about shackling it to your wireless router or computer." This is distinct from how I deploy another printer on my home LAN: tethered to one Windows XP machine via USB but available to other network clients. Another drawback of the wired-to-one solution is the requirement that the "one" computer remain powered on in order for printing to proceed from other network PCs. (This constraint goes away with wired network printers, of course.)

My experience installing the X6570 on my home LAN was virtually flawless. After removing packing tape, installing ink cartridges and the like, the PC-based installation steps on my Windows XP-based desktop were routine and remarkably the same as installing any printer. The "wireless ready" light on the front of the all-in-one had already turned green, and it wasn’t long until the machine successfully printed the test page. My next step was to print from my Windows Vista-based laptop. That process worked fine too, after I realized there was no auto-detect and that I had to do a CD-based install, unlike my experience with my other networked printer and the Vista laptop.

All in all, I think Lexmark (and by inference the rest of the industry) is on the right track in supplying easy-to-use wireless printing. There are certainly other ways to share a printer, but the placement flexibility offered by wireless is nice, and even saving a USB slot is worth something. As more home LANs spring up, the utility of wireless seems positive enough to make its presence in consumer printers a future standard, and only "conspicuous by its absence." The test on my home LAN will really come with the holidays, as our house fills up with laptop-toting late-teens and early-twenties family members. We will see what they think about the wireless machine. But oops, that’s right, they are in the age group that does not print…

As a brief footnote, this concludes my column's second full year—yes, that is 24 official Observations columns, plus a few extraneous ones—and I want to express my sincere thanks ('tis the season, after all) to Charley LeCompte, Ann Priede, and the rest of the Lyra and The Hard Copy Observer crew who have made me feel like part of a great extended family. What started with an inspiration for a one-shot retrospective guest editorial has turned into a regular column and blog that has forced me to stay current and on top of a dynamic industry that I love. With any luck, I will stick around! Look for year three of my Observations column starting with the December 2007 issue.

Thursday, November 15, 2007

Wrapping ImagePrint 2007

Thanks to HP for letting me join them for their Phoenix gathering. As far as the blog, that's it for now, but I'll be following up here with a few related items in the coming weeks.

Also, see another update on the conference at a new HP LaserJet Blog post, from Vince Ferraro. And thanks for the link Vince!

Print 2.0 for the Enterprise

I've been live blogging from HP's (NYSE HPQ) ImagePrint 2007 the last couple of days, as readers of this blog will know. The event itself has been impressive both for its rather massive scale as a whole, as well as for the sum of its many impressive parts. (For the official HP blogger view of the event, see Mike Feldman's post at HP's Enterprise Printing Blog -- and thanks for the link, Mike!)

One topic that's been on the docket here and that I vowed to take a closer look at has been "Print 2.0 for the Enterprise". I've posted numerous times about both some of the Print 2.0 consumer applications and partnerships (e.g. see "Printing talk at the Web 2.0 Summit") and also some of the challenges HP faces in communicating this most ambitious shift in their Imaging and Printing strategy (e.g. see "Follow Up on HP's Print 2.0"). My interest and understanding of the end-user-oriented subject area comes naturally to me as both someone who helped develop the nascent Web printing strategy in its infancy at HP a dozen years ago, and as a user and proponent today. And on the communications angle, I've speculated that perhaps a share of the challenge in HP defining and then marching towards a "Print 2.0" vision might be from pulling in "too much under the tent", questioning at least privately whether an Enterprise story was helping or hurting the clarity of the message.

Anyway, after time at the conference with HP executives like Keith Moore, Chief Technology Officer for HP's Global Enterprise Business, I'm beginning to believe. Common strategic basics like "connecting bits and atoms" (with credit to Nicholas Negroponte) really do link the worlds of Enterprise and Consumer. Crucial to this is the acceptance (and understanding) of an altered role of paper and printing in a still-physically-oriented but radically changing world of information (see "The Changing Role of the Printed Page"). The HP story holds together and even begins to build. I said at the beginning of the paragraph I'm beginning to believe, and I think by its end, I believe even more...

In my opinion, embracing the moving target of how paper and printing is changing puts HP, and its printing industry competitors who join in, at a major advantage in crafting a business strategy for the future. I'd say those who point to GDP-level-growth in printer and paper markets (see "...Analysts Hold Firm on Print Demand") as evidence of unchanged behavioral patterns are "whistling past the graveyard".

HP's "Handheld sp400 All-in-One"


It's unlikely you'll be finding this one at the nearest Office Depot or CompUSA anytime soon, but the Handheld sp400 All-in-One from HP (NYSE HPQ) is on display in the showcase area of the company's ImagePrint 2007 conference concluding today in Phoenix.

This is an industrial product that was designed by having HP design/marketing teams work closely with HP customers in their shipping areas, learning their process cold, and then building a solution to solve the unmet customer needs, in this case included inkjet printing and scanning, integrated with wireless communication with the centralized data base. It's a joy to see this marketing process at work, whether with consumers, office staff, or in this case shipping department managers and workers. Here's the message to the potential customer:

[As a] package rolls down the line, your crew can scan it, send data wirelessly, and then print a label or message directly on the package with one simple, portable device. Sound revolutionary? It is. In fact, the HP Handheld sp400 All-in-One is the first and only scan-and-print solution to integrate a 2D barcode imager, inkjet printer and wireless communication in one device.


ImagePrint's showcase is organized by "Vertical Market", and besides Manufacturing and Distribution, where I found the sp400, also includes Retail, Pharma and Life Sciences, Education, Government, Financial Services and Insurance, Healthcare, and Retail Banking. These specialty areas surround exhibits of more general interest, including (of course) HP's Edgeline solutions and a "Green Office" exhibit that deserves its own future post.

Wednesday, November 14, 2007

Live Blogging HP's ImagePrint 2007

I've been invited to spend some time at HP's (NYSE HPQ) annual convening of key corporate and enterprise printing customers and partners, which is being held at the Phoenix Convention Center this week. It's a two-day event that includes an executive summit focused towards Chief Information Officers (CIOs), as well as a solution center including HP's latest and greatest. While the event features a few new printing solution announcements, its primary focus is the sharing with the 1,000 or so attendees at the "sold out" event the latest in HP's thinking and direction.

In sessions I've attended so far, with titles like "HP Printers in the Enterprise" and "HP Total Cost per Page", executives including HP's Tom Codd and Steve Watt explain how the company positions its printers in the enterprise, vis a vis the competition, on factors like cost (obviously) as well as ease-of-management and "Green" attributes.

I'll have more updates from the conference, but suffice it to say for now that the depth and breadth of HP in the printer business is something to behold. Throw in a thousand users and administrators who really care about printers and printing, and who wouldn't be happy???

(Full disclosure -- In a previous career, I worked in HP's printer business, leaving the company's employ in 2005.)

Monday, November 12, 2007

Most interesting 20 printers of the year

Noted printer reviewer M. David Stone has authored a most interesting slide show that can be found at the eWeek web site entitled "The 20 Most Interesting Printers of 2007 (So Far)". He highlights products from HP (NYSE HPQ) (eight models total, including five based on traditional inkjet technology, two on laser, and then the new Edgeline inkjet), Canon (four total mentions), Lexmark NYSE LXK) and Xerox (NYSE XRX) (two models each), and filling in with Dell, Epson, Eastman Kodak Company, and Memjet (all one model each). The latter one, Silverbrook Research's Memjet, is the exception in the group of 20, in that it represents a technology as opposed to a currently shipping product, but certainly has stimulated enough discussion in the business to deserve a place on the list.

This excellent recap has been out there for a few weeks but I'd missed it, until led into the EWeek.com site's printer area by the provocative headline, "Health Workers Addicted to Black and White", which covers the same Lexmark research I covered last week.

Thursday, November 08, 2007

HP: What's bad for digital cameras is good for Print 2.0

HP (NYSE HPQ) issued a post-market-close press release yesterday that I found both interesting and unusual. The news has been well reported, but a few of the more subtle details are worth noting.
  • The release headline itself, "HP to Seek New Business Model for HP-branded Cameras" -- when was the last time "business models" were the focus of a $100 Billion company's press release? Takes one back to a typical announcement from the last, VC-fueled Internet bubble and a much smaller, newer company.
  • Open disclosure of seeking out an outside OEM to market products under the HP Brand -- this always seemed like the type of relationship that was carefully and quietly managed. Insiders know it goes on all the time, but why publicize it? Do consumers need or want to know their "HP" camera really is from another company?
  • Publicly trading off one investment for another -- Good for Print 2.0, the new focus for HP that will benefit from its de-emphasizing digital cameras, as documented in the release, but again, not the norm for a public announcement.
  • "HP makes cameras?" -- Of course many of us know the company's long history in the area, but with their low visibility in at least some segments of the camera market, there must have been at least a few readers that had this or a similar reaction.

Wednesday, November 07, 2007

Small Business productivity and focus, and other happy marketing stories

The printing and imaging industry has taken the small business to heart this year (see "Observations: The Year of Small Business"), with efforts to boost their efficiency and productivity via in-house publishing (see "Observations: Low-End Color Lasers—Build Them and They Will Come?") while not ignoring sensible outsourcing decisions when quantities, price breaks and capabilities so dictate (see "Small Business Printing -- when to stay in-house, when to go out-sourced").

Of course, there are two ways to help on productivity and efficiency, including the direct way, like on the aforementioned marketing collateral efforts, and the indirect way, by removing non-core tasks from the small business person's workload, thus freeing up more time to focus on what they do best. This is the angle I see being played to by well-known commercial print provider PrintingForLess.com, and their small-business-oriented turn-key custom holiday card service being announced tomorrow. The value proposition: get your all-important holiday greetings out to your valued customers and suppliers with the minimum amount of time and hassle, leaving more time to build your business, especially at this time of the year when time is money for so many of us.

In the same vein, I want to mention a personal experience I had with another source of services, in this case relieving me from potentially hours of non-core activities. Elance offers a service matching buyers and sellers of services, in my case a seemingly minor but still knotty web programming challenge that I just didn't have the expertise to take on, and also didn't have the time to develop that expertise. I described the job, put it out on Elance, and a few days later had a completed job done for a very reasonable price. I'm a very satisfied first-time customer.

And speaking of customer satisfaction stories, I need to add one more. My Apple iPhone's protective case, provided by Incase, has saved my phone and me from disaster at least a few times, but it had a problem beginning to develop. I called the company, got immediate help with some simple information-sharing instructions, and a new replacement case was on its way to me in no time, which I've since received and am very happy with. Thanks Incase, both for the painless exchange and the great example of how to treat your customers!

Tuesday, November 06, 2007

Truth in research -- Black and white printing the choice in healthcare

In a refreshing piece of marketing research released by Lexmark (NYSE LXK), health care professionals they studied "rely on basic black and white" printing, over color output. (See "Lexmark research shows printing is black and white for most health care professionals".) The health care professionals studied were in the US, UK, and France, and their mix of print jobs favors text documents (52 percent), forms and records (26 percent), short reports (26 percent), and invoices and purchase orders (21 percent). They place a premium on print speed and ease of use, but for these jobs, apparently black and white does just fine. Color usage was either "outsourced" or "incidental".

For the second time in a week, a printer vendor has surprised me with an action that breaks set, even while brimming with common sense! Last week it was Xerox teaming up with GreenPrint, the software that allows users to print LESS, and now Lexmark touting the importance of old-school monochrome laser printing in an important and growing sector of the global economy.

My expectations on commissioned research studies might have to be reset a bit. I've pointed out in the past that companies releasing the results of their own marketing research (see "Research on economics of small business printing") seem to always come up with results consistent with their marketing strategy. One would guess these days that generally involves rolling over customers' installed base of monochrome laser printers to new color models. Maybe at least Lexmark is seeing a healthy future for faster and easier-to-use monochrome printers!

Cookbooks from Allrecipes.com and SharedBook


SharedBook has announced a new alliance with popular cooking site Allrecipes.com, for printing hardbound (and softcover) cookbooks using their Reverse Publishing platform. I've covered SharedBook since their appearance at Demo 2006, and have had good success with my creating my own book, publishing a hard cover book with content from this blog.

Their latest deal hooks together their book creation facility with one the leading US-based cooking recipe sites, and it seems like a great fit, with users having the ability to combine their own personal recipes and images with the 40,000 already available at the site. The Allrecipes.com site, with its one million-plus membership and five million-plus monthly viewership, was acquired by Reader's Digest in 2006.

The books are touted as great gifts and keepsakes, as well as "working cookbooks" for regular use in the kitchen, at least in those homes where the "kitchen computer" has yet to find a place. Along with driving directions, single-page cooking recipes are certainly one of the home printer's newest regular chores, at least at my house, so it makes sense that a more permanent book form of this application would find a place in many kitchen libraries. I'm planning to give "Create-A-Cookbook" a try, so stay tuned.

Monday, November 05, 2007

Antonio Perez takes a shot

Kevin Maney's Tech Observer blog contains a post from over the weekend about his discussion with Kodak (EK) chairman and CEO Antonio Perez on the subject of Silverbrook Research and Memjet. Despite Eastman Kodak Company's good news last week including profitable third quarter and the EasyShare inkjet all-in-one printers now being available at an amazing 7,600 retail outlets worldwide, Kevin seems to have caught Antonio with an ire-inspiring question. I've documented both HP (NYSE HPQ) and Lexmark's (NYSE LXK) rather grumpy responses about Memjet's promise in the past, so maybe Perez felt like it was his turn to go on the record.

Thursday, November 01, 2007

More on those trillions of pages

The Xerox blog "The Future of Documents" by Francois Ragnet has a recent post worth reviewing, attempting to reconcile HP's (NYSE HPQ) "total market size" number of 48 trillion printed pages today, growing to 53 trillion in 2010. He brings in a Lyra Research market assessment, that puts the 2006 worldwide paper market at 15.2 trillion pages, and goes on to delineate what they include in their estimate. It seems interesting that one number is three times the size of the other, especially when I look at the Lyra definitions and try to think of what they DON'T include in their count (that would account for two-thirds of the HP-supplied number).

I'll invite readers with paper industry expertise to weigh in.

And as far as "How Big is Big"? I think I agree with Francois that yes, all these numbers truly are big!

GreenPrint, Xerox Solid Ink Printers get together

Two companies I've blogged about this year have come together in a partnership that apparently is designed to help Xerox owners print less! Buyers of Xerox's Phaser 8560 and 8860 printer/all-in-one solid ink jet color products will be entitled to a free download of the popular GreenPrint software, which actually makes perfect sense combined with the strong Xerox (NYSE XRX) "Green" message.

It's been quite a year for Portland-based start-up GreenPrint (see "Making it to the Top of the PR Mountain"), and Xerox has been getting a lot of "ink" as well (see "Note to Xerox: You got HP's attention".)

Wednesday, October 31, 2007

Print 2.0 Interview

Patrick Scaglia over at the HP Print 2.0 blog has an interesting recap and link to an interview between HP's print leader, Vyomesh Joshi, and John Battelle, that was recorded at the Web 2.0 conference a couple of weeks ago. Nothing really new here but good to hear it all in one place -- recommended!

And hats off to the newly-named "Print 2.0" blog, too! I feel a bit like Stephen Colbert, taking credit whether it's due or not, but I suggested the simplified (sans HP acronym) blog name some time back, so glad to see they've done it!

Tuesday, October 30, 2007

Where do those online product reviews come from?


In doing a little research for an upcoming "Observations" column, I've done a "light-touch" review of an interesting all-in-one product from a well-known vendor. (I'll save my specific thunder for the actual piece, coming up in about a week.)

But a sidebar worth noting -- as part of my product evaluation, and following my hands-on work, I went out to several popular online vendors and read what their customers were saying. (I have learned it's best to do your own evaluations first, rather than be colored by the experience of others.)

Both vendors' customer review sections for this unnamed product summarized their customer reviews with less-than-perfect ratings between three and four stars. (I'll disclose the resellers' names -- they're Best Buy and Amazon.) In both cases, as the product in question is rather new and not necessarily a category leader, there were not a large number of customer reviews, 12 and 2 respectively. So with these low numbers of responses, one negative review really tends to skew the average (especially in the case of the two!). And that's what happened. BUT...in this case, the negative reviews were from the same customer! I noticed this from the wording (and misspellings), for example:

The bundled software was not user friendly, very slow and you must be a computer wiz to hook it to your wireless router- you should have knowledge of `bridging', `ad hocking', `setting up ip address' etc etc. With the help of my `computer wiz' teen son I finally able to run the printer. But it did not last long, in about two weeks printer refused to communicate with router or computer. Called tech support, which is a joke- I fall in sleep waiting and listening their music.


While the reviewer (identified by different names at the different sites) didn't go totally harsh on the star review with two out of five stars, the body text of the reviews is identical and INCLUDES A RECOMMENDATION FOR A COMPETITIVE PRODUCT at the end of the review. (They carry the same post date -- October 24 2007 -- but different post titles and different poster names.)

I've always assumed the customer reviews were specific to customers of the product and reseller in questions. Apparently not. This deserves some follow up.

Friday, October 26, 2007

More 'How Big is Big?'

I encountered an interesting blog post over at Applied Disruption that expands on similar themes I was getting at in my October "Observations" print column. (see the October 2007 edition of The Hard Copy Observer or my blog posting of the column.)

In "HP steals from government playbook..or..How to get impressive sounding market size" blogger Jeffrey Stewart makes points about the "game" of estimating a new company's market size in the most positive light, sometimes to extremes. He's used HP's recent "53 trillion pages" stat as an example. I know Jeff from his days at Mimeo.com, but even if I didn't I'd recommend his blog. Worthwhile reading.

In a related tangent, I was interested to read Chris Shipley's Demo Letter this week, "DEMO is about product innovation, not just about start-ups", which furthers the point that the title does nicely, or in my words, don't assume it takes a start-up to innovate!

Tuesday, October 23, 2007

Lexmark can't match Apple results

Monday's post-market story was Apple (NASDAQ AAPL) and its blow-out quarter. Printer maker Lexmark (NYSE LXK) has its quarterly results available as of this morning and the numbers are NOT good. Their year-over-year earnings declined 47%, revenues were off 3%, with business sector business up a bit but consumer business off more. LXK's stock, after meandering up with various takeover talk recently, is off about 9% and below $40/share after about an hour of market activity this morning.

Monday, October 22, 2007

Dell PCs ... and Printers ... coming to Staples

News this morning from Round Rock that Dell (NASDAQ DELL) will be expanding its retail distribution to office supply chain Staples (NASDAQ SPLS), in both their 1,400 retail stores as well as their online store, beginning November 11.

This follows Dell's move earlier this year into Wal-Mart. (See "Wal-Mart and Dell".) Of particular interest are these inclusions on the product list to be offered: "Dell 948 and 926 all-in-one inkjet printers, [and ] Dell 1320c laser printer...Staples will offer ink and toner for most Dell printers."

Friday, October 19, 2007

Still no LXK acquisition

Today's acquisition-related non-news, this from the Xerox (NYSE XRX) earnings announcement, was CEO Anne Mulcahy's negative assessment of the likelihood of their acquisition of Lexmark (NYSE LXK). (See "Xerox CEO says acquisition of Lexmark unlikely".)

Regular industry followers need no reminding the the Lexmark acquisition rumor has been circulating regularly, albeit with a revolving list of speculated suitors. (See "No Lexmark Deal...Yet" for a recent example.)

A look at today's market activity would lead one to conclude there's still some wind in the sails of the story though -- on this ugly day for the stock markets, with most indexes off 2% to 3% (on the 20th anniversary of Wall Street's Black Monday, no less), LXK went the other direction, with a gain of $0.33 to $42.35.

Quilting books from blogs

As my regular readers know by now, I cover the printer industry with a marketing view, which means I like to tune in to user (customer) needs and how their needs are satisfied by hard copy solutions. One site that's come to my attention, as it relates to my interest in the "blogs to books" arena, is the Serendipity Patchwork and Quilting blog. Brenda Gael Smith, owner of the blog, found my references to printing books from blogs (e.g. "My Blog2Print Book is in!") and linked to them from a post that included all the "usual subjects" in this area -- Blurb, SharedBook, Lulu, blogprint.com, and of course HP's efforts in blog printing -- most of whom I've covered here at one point or another, and I'll send you their way for the company links. (see "Blog to Book Options".)

While one might argue this is only a tiny slice of the overall pie of blog-printing demand, that's kind of my point! I think it's critical to understand individual market segments and their needs -- in this case, a handsome book printed from the online visuals of creative and beautiful quilt designs that satisfies the quilt fan's "user needs" of permanence and sharing that only a book can offer. (Effective printing of individual blog posts might be critical for the purposes of hands-on quilting, where the post includes instructions and other ideas.) In my mind, this understanding of user needs is equally or more important in assessing market demand than the "how many blogs are there and let's assume x percent want to print them" approach! (Actually they're not mutually exclusive -- both approaches are important.)

Thursday, October 18, 2007

Printing talk at the Web 2.0 Summit

Another Web 2.0 event is going on this week, sponsored by O'Reilly Media, fitting in that the company's founder, Tim O'Reilly, is credited with defining the term Web 2.0.

In our business, HP (NYSE HPQ) has been the leader in applying printing ideas to this arena (dubbing their broad initiative with the handle "Print 2.0"). They have their executives at the conference this week, taking their story from HP-sponsored, print-industry events (see my recaps of their end-of-May and end-of-August events) to the bigger, broader world.

This bigger picture approach is critical in communicating HP's vision of printing from the Web (as is the acceptance that the message may need to be reinforced again and again). As I personally found out more than a dozen years ago, while working on this idea in its embryonic stages, most of the Internet's concepts and designs center around the display aspect of the human interface, but when it comes to real users, hard copy "takeaway" is also part of the solution. In the simplest sense, this might be printing driving directions from a mapping site. On the other end of the continuum, an example is the preservation and ability to display or pass along the artwork passionately created (see example image above) on a Facebook wall via Graffiti, one of HP's recent printing partnerships.

Further info on all the partnerships (Disney, Flickr, Graffiti and Microsoft Live Spaces) can be found in HP's release and elsewhere in the news. A good read, too, is the blog entry from one of O'Reilly's own, Sarah Milstein, at the O'Reilly Radar blog with "Better Printing from the Web (Way Better)". I had the chance to chat briefly with HP exec (via Tabblo) Antonio Rodriguez following the seminar covered by Milstein, and he was very enthusiastic about his presentation and the response to it. Continuing to go beyond the printing industry is exactly the kind of pioneering that HP needs to keep doing to make their story really go somewhere!

Wednesday, October 17, 2007

Not quite a printer acquisition

Today's stock market was boosted by tech stock gains, and one substantial acquisition. It was not the printer-industry-direct-hit that might have been anticipated after last week's reports about Lexmark/Dell and HP/Kodak rumors, but there is at least a footnote's worth of relevance to this one. Beaverton OR-based Tektronix is being purchased by Danaher for $2.8 Billion.

Tektronix is a test and measurement company that ventured into printers not so long ago, and did quite well with a line of solid inkjet products. The division was sold to Xerox for a little less than $1 Billion in 2000. The further development of those products under Xerox management has led to many new printer and all-in-one products over the years and the company's recent "color at black-and-white prices" marketing push.

Word for the Day -- "Transpromotional"

While this blog's coverage focuses on the workgroup/desktop printer market, the world of the digital press occasionally sneaks in, if for nothing more than the fact that the major players are pretty much the same, or at least a subset.

A piece by Christopher Lawton in yesterday's Wall Street Journal entitled "Bills Make Room for Advertising -- Printing Promotions Right on Statements May Get More Notice" caught my attention and is worth noting. He reviews the growth of printing personalized advertising offers directly on billing statements, and the enabling technology including, of course, digital presses from Xerox (NYSE XRX), HP (NYSE HPQ) and Eastman Kodak Company (NYSE EK).

It's a good piece, and especially interesting to me in that it focuses on the APPLICATION and thus the "why" behind the unit sales growth in this category, which is illustrated with a nice chart from InfoTrends, showing placements of 60+ppm color printing systems going from under 2,000 annual placements in 2006 to about 7,500 units in 2011.

A question I have about this "transpromotional marketing" trend, with InfoTrends quoting "roughly 95% of people open and look at their bills and statements"? I may be an early adopter but I'm moving as fast as I can AWAY from receiving paper bills. The era of simplified electronic bill presentment, promised for so long, seems to be upon us, and the last thing I want to be doing is handling a bunch of paper just to keep on top of my monthly bills. Oh well, time will tell...

Friday, October 12, 2007

A big week for P&I M&A speculation

With the week's earlier story of a possible Dell (NASDAQ DELL) acquisition of Lexmark (NYSE LXK) already stirring the pot, add the possible combination of HP (NYSE HPQ) and Eastman Kodak Company (NYSE HPQ). The Financial Times' David Zielenziger has a piece out today entitled "Hewlett-Packard perennial bid speculation for Kodak resurfacing, industry sources say".

I would think Kodak's attractiveness to HP has to be enhanced by the market success with their recent photo inkjet printers and all-in-ones. The company's recent expansion into WalMart and international markets (see "Meet Me at the WalMart".) My hands-on experience with a Kodak EasyShare 5300 all-in-one has been very positive, and in full reviews, the product has fared well against comparable HP models. (For an example, see USA Today for Ed Baig's review, "Almost a photo-finish...".)

Observations: How Big is Big?

How Big is Big?

The inspiration for this month's column comes from a like-minded friend and industry colleague who enjoys questioning basic concepts that most of us take for granted. In this case, the question centers on industry numbers that get bandied about all the time and, more often than not, with little thought about what they really mean.

In general, the same cannot be said for our personal lives. For example, $2 is a high price to pay for a basic cup of coffee, and at $3 a gallon, the price of gasoline is sky high. But what about on the business side? The world of ink jet supplies, where consumers and business purchasers blend, is a plausible bridge to that question.

While attending the Lyra World Expo preshow conference in August (see the October 2007 Hard Copy Observer for further coverage), I observed that much of the discussion on trends in supplies pricing involved the purchase price of cartridges, with sub-$20 price points becoming popular among OEMs and third-party companies. Even with a reduced quantity of ink, the broader view of cost per page (CPP) seems to be taking a back seat to the lower entry price. I maintain that this phenomenon is because people can relate to the out-of-pocket cost much more easily.

That example grounds us on prices, which we can begin to relate to our personal cash flow. Then we can blow up some of these numbers to see how they fit with the very most macro of numbers in our business. At the Lyra preshow conference (see "Lyra Industry Experts Speak"), analysts presented that the crossover point between hardware revenue and supplies revenue (ink and toner) occurred in 2005, when revenue from each group was just below $60 billion. Using that as a starting point, assuming that half the supplies revenue is from sales of ink jet cartridges, and estimating a weighted average selling price of $20 a cartridge, we get a unit total of 1.5 billion cartridges shipped in 2005. In terms of toner, $30 billion in toner cartridges, at $100 each, infers 300 million units shipped annually.

It is tempting to want to go on and extrapolate using an active installed base of 500 million ink jet printers (1 printer for every 12 individuals on the planet) and an installed base of 200 million laser printers (which I got from knowing HP (NYSE HPQ) just shipped its 100 millionth unit more than a year ago). But we had better stop right there. At this point, a number of issues, such as how many cartridges per ink jet device and color versus monochrome laser machines, really need to be modeled separately. This is a good example of why the spreadsheet was invented. As we leave the back of the envelope, we start to add necessary richness and complexity.

I have not validated the numbers that go into my assumptions with "official" sources like Lyra Research, the publisher of this newsletter, but they seem to make sense. One danger, of course, is piling bad assumptions on top of more bad assumptions and ending up an order of magnitude or two off from the "real" number but, more often than not, the assumptions tend to balance each other out.

Printers and cartridges inevitably lead to pages, and that topic is really for another column. But just to put a toe into the water, HP has been making hay with its "paper pie" for a long time. In October 1997, the firm’s entire annual pie for the United States totaled 12 trillion pages, and pages produced on digital printers accounted for 3 percent. Fast forward to more recent years, when HP executives have talked about a worldwide annual page count of 46 trillion pages in 2006, growing to 54 trillion pages in 2010 (Observer, 9/05). These numbers seem a lot more enticing. Taking the $60 billion supplies revenue number and dividing by 3 cents per page give us 1.8 trillion pages. (These are from products that Lyra categorizes from sub-$100 ink jet printers to low-end typesetters and copiers.) If we accept HP's current page estimates, that puts digital pages at just under 4 percent of the market. While 3 cents per page may be woefully inadequate as an average, that figure gets us in the ballpark.

We can use this same type of analysis to look at big numbers that are not related to products. For example, in my September column, I commented on HP's $300 million marketing campaign touting its "Print 2.0" message. While that figure seems large, if we compare it to the approximately $30 billion in annual revenue from HP's Imaging and Printing Group, $300 million is "only" 1 percent of the unit's top line. The most talked-about metric in television advertising, at least among laypeople, is the cost of an advertisement spot during the Super Bowl. The price has recently passed $2.5 million for a 30-second spot, so picture this: at that price, HP's $300 million budget would buy one full hour of Super Bowl advertising (120 spots).

We have only scratched the surface on this topic, so I would like to revisit here from time to time. I am a big proponent of "back of the envelope" figuring and knowing some key benchmark numbers can really be a big assist. Some of those I would suggest include the one-million-a-week printer shipment level that HP reached a couple of years back, the aforementioned 100 million LaserJet installed base, the 50:50 split reached a couple of years ago between hardware and supplies, HP's just-under $30 billion in revenues, and likewise, HP's 50-percent share position in many of its markets.

Creating easily-visualized images is of great help, too. I remember that when the HP LaserJet hit sales of one million units in the late 1980s, a very creative management colleague chose to make it real by expressing that milestone to the local media as follows: take your local 25,000-seat football stadium, and put a LaserJet printer in each and every seat. Now stack 39 more of those printers on each seat, and you have 1 million printers. When HP hit its 100-millionth LaserJet shipped in 2006, one could expand the visual by imagining 99 more of those stadiums.

As much as I enjoy this kind of mental exercise and am a proponent of its usefulness in business, things can change, just like in everything else. In a recent class I was teaching, I described a hypothetical analytical problem to my graduate marketing students, and asked how they would solve it. Without hesitating, one of my eager students raised a hand and shouted out "Google!"

Thursday, October 11, 2007

No Lexmark deal...yet?

In the recurring rumor mill, Lexmark (NYSE LXK) was reputed to be back in play this week, at least per a number of sources, as summarized by Reuters and Seeking Alpha. But enthusiasm for the the stock waned today, as the shares fell back (early on, well ahead of the rest of the market's late fade), and closed at $41.06, well below the heady $43.80 Wednesday close. (At $41.06 though, LXK is still almost a buck over the Tuesday close.)

And unlike the swirl of the late Spring/early Summer (see "Lexmark Buy-out Drumbeat", when Lenovo and private equity firms were considered possible buyers, the Fall's likely candidate for acquiring Lexmark is none other than Dell. The former do-nothing-wrong company that has struggled in the last couple of years seems to have regained some of its footing, with its stock up 30% from its 52-week low. My speculation about Dell's potentially exiting the printer biz as a part of their re-focusing appears to have been just that, speculation, at least if they're thinking of buying their biggest supplier in the category.

Lexmark's market cap is at $4 Billion, and while they'll be fortunate to reach the $5 Billion mark in revenues for 2007, Lyra estimates the value of just their supplies market, at retail, at about $6 Billion annually. Again, that's at retail, and includes both OEM (branded) and 3rd Party ink and toner.

Wednesday, October 10, 2007

Autumn "Clip Show"

At the risk of getting away from my normal Printing-and-Imaging-News-and-Analysis beat I'll combine these three recent tidbits that have come my way. (See my July 2007 "Summer Clip Show" for the title reference.)

First, my friends over at the Databazaar blog tracked down an interesting photo frame/printer concept. See "Off-The-Wall Printers". Interesting post with some great links!

Second, another group of friends behind one of the growing list of HP (NYSE: HPQ) Printing Blogs (this one humbly titled HP Experts Talk about All Things Inkjet) feature a recent post highlighting a commissioned research study that concludes "HP Photosmart Photo Printers are the easiest and fastest...". Like I've previously commented about vendor-commissioned research (e.g. "Research on Economics of Small Business Printing"), the final results aren't the story -- but looking at how (and why) the research was commissioned, where it's executed, what competitors are compared, etc., leads to some potentially interesting insights.

And lastly, and least directly relevant, is the post from people I don't know and have never met, over at ZDNet's blog, The Apple Core. The post from earlier in the week covers the XO computer, one of my personal interests but least relevant from this blog's perspective, but I like the approach -- looking at a new development and adding historical perspective, in this case the "$100 laptop" and Apple's long-ago effort with the eMate. Here's the link and accompanying quote using the Apple Core's "blog this" feature.

The low-cost laptop that Apple should have built (and sort-of once did) by ZDNet's David Morgenstern -- The buzz around the XO Laptop, aka the One Laptop Per Child group’s “$100 laptop” is growing, with an innovative donation program coming in time for the holidays. But this colorful, rugged computer could have come from Apple, and in another time, it did. The One Laptop Per Child organization recently announced a [...]

Samsung investing more in Color Laser Printers

In today's Wall Street Journal Evan Ramstad pens a piece entitled "Samsung Feels Pinch as Pace In Sector Eases" (sorry, that link is a summary only, full text for subscribers only, for now anyway! See "Murdoch makes mark at The Wall Street Journal").

Most of the article covers Korean industrial giant Samsung's category leaders like TVs and mobile phones, as well as their huge components businesses, but notes a change in investment strategy that will direct more funding into the growing color laser printer category.

Other steps also pose risks. Its push on printers, for instance, puts it more squarely into competition with Hewlett-Packard Co. (NYSE HPQ), one of its biggest customers for memory chips and computer-screen components. Samsung is focusing on the changeover in laser printing to color technology from black-and-white for consumers. It is expanding its line of advanced corporate printers to eight models by the holiday season, up from three at midyear.

Tuesday, October 09, 2007

Xerox Management Succession

In the latest Fortune magazine (cover date Oct 15) it's time again for the annual profile of the 50 most powerful women in business. Of special interest for our industry this year is the lengthy story on Xerox's (NYSE XRX) Anne Mulcahy and Ursula Burns and their relationship, entitled "Xerox's Dynamic Duo".

Long ago, I remember hearing the big business magazines were known for "corporate hero worship" and while I believe that has changed considerably in the last 30 years, this piece by Betsy Morris is long on admiration. But still interesting and very much worth reading. I couldn't help note the paragraph that brought home the little HP (NYSE HPQ)/Xerox skirmish I've been covering the last few weeks. (see below -- my highlights.)

While the team has achieved a minor miracle in the past five years, more than halving the company's debt to $7 billion, boosting net earnings 13-fold to $1.2 billion, and producing breakthrough products like the brand-new, solid-ink printer that can make color copies for the cost of black-and-white - despite all that, revenue has been flat for five years now.

Thursday, October 04, 2007

Shipping as a profit center

Herb Greenberg's Market Blog has a post with a link to his interesting Wall Street Journal/Marketwatch piece about Shutterfly (NASDAQ: SFLY) entitled "Why Shutterfly may not be picture-perfect". The article highlights the company's transition from a technology to a manufacturing concern, at least in the eyes of former board chair, Silicon Valley legend Jim Clark. One of Greenberg's "aha's" is the old "shipping-and-handling" charges and their role in driving the bottom line. Worth reading.

BTW here's the link to the PC Magazine story that references Shutterfly's competitor MyPublisher.

Friday, September 28, 2007

Web-based Application Printing -- Google Presentations


I posted just Monday about my printing experiences using Google Docs, and promised more to come. The whole topic, especially concerning the Office Suite variety of applications. (See examples "Web Apps Hit the Mainstream", "Can Anybody Take Down Microsoft Office? Probably, Yeah", and "Pondering Google 2.0: How will it get to $100 billion in revenue?". And with Google's recent release of PowerPoint-competitor Presentations, it seemed like time to look at that program's print capabilities, and like the Google Docs example, I skewed my look clearly in favor of reigning king-of-presentations, Microsoft PowerPoint, by creating my presentation in that environment, which included printing. (I should say I was using the 2003 version of the software, on a Windows XP Media Edition PC, and when it came time to move to the browser, the latest version of Firefox. The printer used was my old reliable HP (NYSE HPQ) Color LaserJet 2550L.


I started with a five-slide presentation I'd be using for a class I was teaching last night. It included three different backgrounds, an imported graphic or two, but no fancy builds or animations. (See an image of the full-size printed pages, above.) And Google Presentations did a GREAT job uploading it, at least for the screen. When it came to printing, it seemed the only choice for printing, as seen in the opening screen-shot image, is the "Printable View" option (it's usurped the standard CTL-P shortcut, which is handy but also indicative that it's the only print option). My hopes were high as this yielded a nice-looking print preview on-screen but prints in a two-up mode, with some of the graphics blacked out and text spacing off, as can be seen below.

Google Presentations printing Clearly not acceptable, either in quality or range of options. The center of gravity for most presentations is their visual projection, and not hard copy, but the solution cannot be considered complete without accurate printing. My long-time background in the printer business tells me not to point fingers, as their are many components of the printing system that need to work in harmony, but I look forward to a future solution that prints perfectly, as we've come to expect from PowerPoint.



(NOTE: Please double click images to get a better view!)