Observations: Corporate Printing, Served and Managed

by Jim Lyons

The Hard Copy Observer, April 2007

One trend on which the printing and imaging industry has been focused for the last decade or so is the convergence between printers and copiers, especially in corporate environments. As vendors of office laser printers have made their products faster and more reliable and added more paper-input and output capabilities, the opportunity to compete with traditional copier vendors’ products became more feasible.

As is the case with many trends in the printing and imaging industry, we have learned that there is a product side and a services side to keep in mind when discussing printer and copier convergence. In the past, copiers were part of the corporate facilities function, and a facilities manager typically acquired a copier as part of detailed transaction including copier leasing, services, and support. Meanwhile, laser printers fell under the domain of information technology (IT) departments, whose purchase of a printer was a much simpler transaction in which the hardware was purchased outright and service and support were provided through a combination of in-house and vendor-supplied resources on an ad hoc basis.

So where are we today? I have been using my “Observations” column these last few months to cover some examples of vendors seeking to identify real customer needs and then doing their best to deliver on a solution to meet those needs. Printer and copier convergence is not what can be truthfully called a customer-driven trend, but a look at how things have gone reveals that this trend fulfills a basic marketing principle—success through finding a customer need and filling it.

In the mid- and late-1990s, vendors were long on talk but short on action when it came to printer-based MFPs. HP (NYSE HPQ), the leader in the laser printer market, pounced onto the product side of things first with its introduction of the infamous “mopier” in 1996. Now, over a decade later, HP finally has a winner with the LaserJet 4345mfp and its variants. Described as “an overnight sensation 10 years in the making” by Steve Reynolds, a senior analyst for Lyra Research, the LaserJet 4545mfp represents the culmination of HP’s efforts, as it vacillated between open and closed distribution with a variety of products from multiple engine suppliers.

The Hard Copy Observer’s first mention of managed print services was in July 1999, when HP announced the creation of its Digital Hardcopy Services (DHS) group as part of the LaserJet business. Kriss Kirchhoff, general manager of DHS, delineated four elements of DHS, including ERP output-management services, host print services, distributed print services, and managed print services. The first three, in retrospect, were really just variations on a theme, which left managed print services as the big prize, where corporate printing is outsourced to an outside vendor (i.e., HP or an HP reseller).

With the mopier of 1996 evolving to today’s LaserJet 4345mfp, and HP entering the managed print services business three years later, where are we today? I recently chatted with Ed Crowley, president of the Photizo Group, an organization that works the corporate managed print services front a great deal. According to Crowley, the interaction between products and services in 2007 is not happening exactly as predicted. He says that full outsourcing contracts are “few and far between.” Crowley sees individual behavior in corporate settings as a big inhibitor. Among managers responsible for making outsourcing decisions, the perception is that a full outsourcing movement will not stop with printers and copiers, so there is a natural reluctance to take this step when the next logical step may be outsourcing those managers’ functions.

On the other hand, Crowley sees the HP LaserJet 4345mfp and its successors “booting out copiers” and acting in a “device consolidator” role in corporate environments, reducing the number of old-school copiers, providing cost savings, and freeing IT departments from the hassle of providing support for individual printers on desktops. He suggests that, in the end, corporations may have 50 to 60 percent fewer output devices. Remember meeting user needs? In this case, the need of the customer is being met, as long as we view the customer as the IT department and the corporate entity such departments represent. If we view the end user as the customer, whether customer needs are being met is a more thorny issue, as end users may not approve of the removal of their convenient desktop printers.

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HP announced an interesting acquisition on March 22 that touches on another subject that has been a favorite of mine in past columns: printing from the Internet. The firm announced it has acquired Tabblo, a small, Massachusetts-based company that has engineering and technology assets that help make printing from the Web easier for end users. The news is covered elsewhere (also, see the April 2007 edition of The Hard Copy Observer), but I wanted to look at this acquisition from the perspective of finding customer needs and then meeting them.

Pradeep Jotwani, senior vice president of imaging and printing supplies at HP, says that his vision is to make Web printing as much a “nonevent” as printing is for today’s productivity applications, and Tabblo will become an HP building block for better Web printing. The firm’s Web 2.0 technology is the first piece of a broader plan that HP will lay out later this year. While Snapfish is HP’s end-to-end system for an online digital photo community, Tabblo represents the component side of things. Through the use of Tabblo’s technology, Web properties will be able to embed tools for better printing from Web sites, including blog sites, map sites, or collections. Of course, like many of the Web printing initiatives going back more than a decade now, the Tabblo initiative will be “printer vendor agnostic,” and Jotwani sums the initiative up from a customer-benefit perspective. “It’s a leadership play that will help the whole industry. But most of all, it helps the customer.”