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HP Optimistic on Print Managed Services

Sales of workstation and desktop printers took a beating during the recession as business made do with the legacy equipment. But what didn’t happen was a decrease in printed pages, and that’s making Hewlett-Packard bullish on its printer and print managed services business. “There’s a large install base of products that could be refreshed because […]

Written By: Lawrence Walsh

Apr 28, 2010

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Sales of workstation and desktop printers took a beating during the
recession as business made do with the legacy equipment. But what didn’t happen
was a decrease in printed pages, and that’s making Hewlett-Packard bullish on
its printer and print managed services business.

“There’s a large install base of products that could be refreshed because
customers during the recession put off refreshing their printers,” says Scott
Dunsire, vice president of IPG sales and
business management at HP. “I do not believe that print is dead; there are
opportunities for partners in the form of things like managed print services.”

The print managed services concept and business model first emerged around
the middle of the decade, as printer vendors such as Lexmark, Xerox, Oki Data,
Ricoh and Hewlett-Packard sought ways for replicating the service delivery
model that photocopier vendors and resellers have enjoyed for many years. By
converting end users to a per-page print pricing and service support model,
print vendors sought to create a recurring revenue stream to augment or replace
their existing fix-cost pricing model.

A long-proclaimed benefit of the print managed services model is the
inclusion of consumables—cartridges, paper and ink. The automated monitoring in
most PMS models not only alerts solution providers to mechanical problems and
regularly scheduled services, but also when consumables are running low.

Traditionally, consumables have not been part of the solution provider
service offering, so PMS created another sales opportunity. But print managed
has been slow to take off, and many printer vendors have had false starts with
their print managed services programs.

HP doesn’t believe it’s changing the game with its print managed services
offering, but rather it’s creating new incentives for solution providers to
adopt the practice.

HP has moved printer consumables under its Image and Printing Group (IPG)
and is allowing partners to count consumable sales toward their PartnerOne
channel program goals and credits. This means solution providers will earn
higher status for the sale of paper and cartridges.

HP is working with distributors, including Synnex PrintSolv, to deliver and
enable print managed services through resellers and managed service providers.

And HP is engaging in end-user marketing to promote managed services as a
viable, cost-saving alternative to purchasing and maintaining a printer fleet.

“End-user customers are looking to save money, and the first conversation by
the partner is that he can save the end user 30 percent of their print cost,”
Dunsire says.

HP is under no illusions that history has not been kind to the print managed
services model. In fact, channel executives say part of the problem is that the
end users weren’t used to buying print as a service and solution providers
didn’t have the acumen to sell print services.

Both conditions are changing, says Herbert Koeck, HP’s vice president and
general manager of Laser Jet and Enterprise Solutions in the Americas.
Today, 50 percent of printing is originated in office applications such as
Microsoft Word or PowerPoint. The balance is printing documents off Websites
and other Internet resources. As more content shifts to the Web, Koeck says the
volume of printing will steadily increase and businesses will demand cost
containment options.

HP Optimistic on Print Managed Services

Lawrence Walsh

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