Ricoh Deal for mindShift to Bolster White-Label IT Services

With the planned purchase of mindShift Technologies from Best Buy, Ricoh aims to expand the IT services that mindShift currently allows other providers to sell under their own brands.

The acquisition of mindShift—expected to close in February—represents an opportunity to bolster a fledgling part of Ricoh’s services portfolio. Known primarily for printers, Ricoh provides managed print services, workflow consulting and a smaller IT services offering. The addition of mindShift significantly expands the scope of the Ricoh IT services portfolio, which Ricoh Americas Chief Operating Officer and Executive Vice President Tracey Rothenberger said is in keeping with a mandate set by the company’s executive management in Japan to focus more on services.

“This acquisition is part of an extended journey we’re on,” said Rothenberger. “The minute Best Buy let it be known that mindShift was for sale, we were in contact with them.”

While most solution providers view mindShift as a competitor, mindShift CEO Mona Abutaleb, said the company has been working with local solution providers to provide white-label IT services they can deliver under their own brands.

Abutaleb said mindShift partners can resell cloud services in a way that allows them to create the illusion of being much larger than they are. That approach, Abutaleb said, allows solution providers to expand the scope of their IT services significantly without having to invest in IT infrastructure and then find the IT people with the skills needed to manage them.

“The cost of delivering cloud service is a serious problem for a lot of local IT service providers,'” Abutaleb said.

Ricoh Americas has roughly 8,000 services employees to which mindShift will add another 650 workers. Abutaleb said mindShift doesn’t offer managed print services, so the relationship with Ricoh adds new capabilities to its services portfolio. Once the deal is final, mindShift will go to market as mindShift, a Ricoh company, which customers will probably see as a more logical fit than when mindShift was as unit of a big-box consumer retailer.

“We’ve have a lot B2B relationships,” said Ricoh Americas’ Rothenberger. “The recent shift in focus for Best Buy makes selling IT services to B2B customers unnatural.”

Michael Vizard has been covering IT issues in the enterprise for 25 years as an editor and columnist for publications such as InfoWorld, eWEEK, Baseline, CRN, ComputerWorld and Digital Review.

Editor’s Note: This article was revised to reflect the fact that Ricoh Americas has roughly 8,000 employees to which mindShift will add another 650 workers. Earlier figures of 3,000 and 500 were incorrect.