Season of the printer

The paperless office isn’t happening. We’re printing more documents than ever before, and printing solutions have become even more relevant in the business world.

Colour, multi-function devices and wireless are all emerging trends in the printer market — and these trends appear to be driving

sales more than seasonal buying patterns. More attractive products and pricing have made certain markets boom, while others are going bust.

According to Evans Research Corp., 498,261 printers shipped in the first quarter of this year, which is three per cent lower than last year for the same period. But, says senior market analyst Bill Fournier, last year the market was extremely weak in the first half but rebounded in the second half.

“”Usually the printer market follows seasonality based upon business buying trends and the consumer buying season, but that didn’t seem to hold because the first half (of last year) was so weak,”” he says. “”So the conclusion that I drew last year was that the market was becoming more technology-driven than season-driven.””

Reasons for this include the growing colour laser market and the multi-function printer market, which he says has “”just exploded.””

“”If you look at the colour laser market, it kicked into gear in the second half of the year,”” he says. In the first half, shipments for colour lasers were down — not something you’d expect for a technology that was supposed to be in high-growth mode.

But, Fournier says, there weren’t any attractive offerings in the market at the right price point with a reasonable speed. Once HP moved into higher-speed products, he says, the colour laser market started to take off.

“”The first quarter of this year vendors shipped 6,389 colour lasers and that is 33 per cent higher than the first quarter last year,”” he says. “”What that suggests is that technology is driving the segments rather than just seasonality.””

The mono laser segment continues to do well — it was up by one per cent over the same period last year. This isn’t much, “”but when you say that you expect colour to begin to become prominent you would expect mono would suffer for it,”” says Fournier. And, to put things in perspective, there were 6,389 colour lasers shipped, compared to 84,000 mono lasers.

The single-function inkjet market, however, is collapsing dramatically — it’s down 30 per cent from last year. While Fournier says this is not surprising — he predicted the inkjet market would decline simply because the MFP market would rise — it still plummetted far faster than anticipated while the MFP market “”just rocketed.””

However, he says there’s still an opportunity for resellers selling higher-end inkjets to users who want to produce photographs. “”They’re going to spend more on a product that is not so much speed-driven but quality-driven — the six-colour products with the longevity and archival qualities,”” he says.

“”Opportunities in inkjet are not at the low end — they’re producing products that are either high-quality photo products or versatile networking business products, says Fournier. “”That’s why the market collapsed, because those are the types of people who are looking at inkjets now. On the surface it looks like nobody’s buying inkjets, but if you dig beneath you find that consumers aren’t buying inkjets (but) businesses are still buying inkjets.””

So, while the single-function inkjet market is declining rapidly, he says there are still opportunities for resellers to sell photo applications and business products.

With laser MFPs, there are opportunities at the low-end selling into the SOHO market. Fournier says the laser MFP market will mirror the inkjet MFP market, while there aren’t highly significant volumes of product being shipped right now, the market is starting to make inroads.

High-end laser MFPs for big business are doing well because people are starting to look at this product category as an attractive document centre offering — where they can go to the same place to copy, scan, fax, send e-mails and get their print jobs.

Sonia Daigle, channels manager of IBM’s Printing Systems Division for Canada, says customers want more cost-effective and efficient general office printing solutions.

Along with that, they’re looking at device consolidation — rather than having a printer, a fax machine and a photocopier, they want a multi-function device that offers all of these products rolled into one.

“”They’re looking to manage their overall information flow, not just from a hardware capital cost, but also information management, document workflow, supplies costs and help desk management,”” she says. “”We work with a number of companies to help them look at their cost of printing today and how we can work toward a solution that will save them money, a return on investment over three to five years.””

Lee Niven, product manager for Lexmark’s Printing Solutions and Services Division, is also seeing a move toward technology convergence, where users have more freedom to handle their documents.

“”They’re looking to streamline the amount of devices in their corporations to help them reduce their costs,”” Niven says. “”Within the marketplace today customers are requesting this.””

As a result, the company is helping resellers get into this market — one Niven says they haven’t traditionally played in before (as it’s been more of a copier vendor area). The company has revamped its channel offerings for the MFP space — routing customers to dealers on its Web site, offering products at demo cost and training resellers on how to sell this product line.

“”Without a doubt, the No. 1 trend right now is colour,”” says Robin Wessel, product strategist with the Xerox Office Group. Why? Because barriers to entry are going away as both price and performance improves.

Selling colour is an exciting opportunity for the channel, Wessel says, because colour revenues can double or triple monochrome since the cost per page is higher. “”Colour has more complexities than monochrome, therefore there’s a more important role (to be played) by channel partners,”” Wessel says. “”Resellers can make it very simple for users.””

Don Cameron, with Epson’s marketing and communications department, sees two major trends: the all-in-one device as well as the six-colour photo printer. He also sees the cannibalization of the four-colour printer by the multi-function device.

He expects the market for photo printers to grow by leaps and bounds: People who have a digital camera are willing to spend the money on a good quality photo printer. This, he says, also applies to businesses that do presentations on a regular basis; rather than outsourcing proposals, they can do them internally.

Wireless printing, he says, has been slower to take off than anticipated, particularly with all the buzz about it, he says. However, it has great appeal to some customers, such as small and medium businesses.

“”As businesses shrink, expand and go through normal business cycles, you don’t have to be running reams of cable and doing all this networking stuff — all the devices are there,”” he says.

“”One of the reasons we think wireless networking hasn’t picked up as much is (because) people are intimidated by it,”” says Tricia Pantry, Epson’s product marketing specialist. “”It is pretty easy, but I don’t think individuals or small businesses realize that yet, so for the dealer the service side of that is setting it up for them and promoting that side more.””

Lexmark’s Niven says a lot of applications are going wireless and the technology is helping people do what they want to do, particularly in the SMB area.

“”Instead of stringing wire everywhere (which) they have to pay for upfront, wireless techn

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Vawn Himmelsbach
Vawn Himmelsbach
Is a Toronto-based journalist and regular contributor to IT World Canada's publications.

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