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HP sketches imaging plan

The computing giant expects to extend its lead in PC printers and push its imaging business in new directions as a result of its recently completed merger with Compaq.

Hewlett-Packard expects to extend its lead in PC printers and push its imaging business in new directions as a result of its recently completed merger with Compaq Computer, the head of the division said Tuesday.

There were few surprises as Vyomesh Joshi, president of HP Imaging and Printing Systems, outlined post-merger plans for the company's most profitable unit. Compaq has had minimal presence in imaging products, selling a few digital projectors and re-branded Lexmark printers.

All Compaq imaging products will shift to HP, Joshi said in a conference call with the press and financial analysts, adding that the move should have a significant impact on sales of HP printers and items such as ink cartridges. He estimated that 18 percent of Lexmark's revenue--which totaled $4.14 billion for the 2001 fiscal year--came from Compaq-related sales.

Beyond that, Joshi sees the combined IT strength of the merged company allowing HP to push into new business areas, such as commercial printing systems and multifunction digital printing systems to replace copiers.

"Why buy a digital copier?" he asked during an interview following the conference call. "You can buy a multifunction device from HP--it hooks into your network; you get our IT support. Those are the value propositions we believe we can bring into the high-end of the market."

Joshi also sketched plans for continued growth in photography-related equipment. The company has already established a solid position for digital cameras and consumer photo printers, he said. The next steps will include more complex systems targeting the rest of the photo business, everything from retail photo-finishing systems to storage networks for saving photos online.

"I think next year you will see the result of us winning in the low-end of digital imaging," Joshi said. "After that, it's really more of a staircase. We will participate in all the profit pools in the imaging market."