HP expands its printing push
Hewlett-Packard officially launches its effort to wring more consulting dollars out of its printer business by helping large companies manage their printing and imaging needs.
As previously reported, the move is an expansion of work HP already does to support its large printer business and is a key part of the company's effort to beef up a unit that accounts for the bulk of the company's profits. Over the past nine months, HP has doubled the size of its imaging and printing service staff to 200 workers.
The services push will focus on several areas, including consulting and managed services, that in some cases will have customers transferring ownership of their printing equipment to HP and paying for their printing on a per-copy basis.
HP believes that its services can help some companies save as much as 30 percent on their total printing budget.
"Customers are looking for assistance in terms of imaging and printing services to reduce cost," said Steve Culhane, a former Compaq Computer executive who is heading up the new imaging and printing services unit. Culhane reports to an executive in HP's printer unit, although revenue will be divided between that business and HP Services.
The new unit will work with companies to help create customized sales presentations, an effort that draws on HP's acquisition of Indigo, a maker of high-end printers that rival the output of an offset press. HP also will offer more traditional services such as technical support--an area where the company has done the most business historically.
HP has been boosting its printing services business over the past year. Culhane said the company has closed 23 printing-related services deals in the past six months, worth a total of more than $100 million.
Rival IBM says it has been offering the same types of services for several years.
"What we've certainly found over the past couple of years is that midsize and very large (companies) are finding they spend a very large amount of capital and expense on print," said David Dobson, general manager of IBM's printing systems business. Historically, it has been hard to get technology buyers to pay attention to printing costs, but Dobson said IT managers are increasing their scrutiny of such expenses these days, creating an opportunity for those that can help a large company cut its costs.
IBM said in several cases it has been able to cut companies' print costs by 20 percent to 30 percent, in some cases by taking ownership of a company's printers and copiers and providing such services on a per-page basis.
"That's probably one of the fastest-growing parts of our business," Dobson said.