Delivering the Value of Color

Malcolm Hancock

Principal Analyst

Digital Documents and Imaging Group

Agenda

Color in the office

– Buying experiences

Technology Battle — Laser vs. inkjet

– Cost issues

Product Convergence

– How does multifunction fit in

Recommendations

A Management Blind Spot

Few know exactly what equipment they have Fewer still monitor supplies or post-acquisition

spending Few know what users are operating what equipment

and how they are using it Most pay only intermittent attention to output fleets Organizational responsibility is sometimes

splintered Fairly low level of concern — not perceived as a

serious problem or an opportunity to cut cost

0%

20%

40%

60%

80%

100%

Small Midsize Large

Inkjet Page Matrix

Print Technology Use by End-User Category

Purchasing

0%

20%

40%

60%

80%

100%

Small Midsize Large

Inkjet Page Matrix

Print Technology Use by End-User Category

The Problem

Workgroup

Personal

Purchasing — The Wrong Products

Color Printing: The Promise/The Problem

The Promise Improve communication via enhanced comprehension and persuasion

The Problem Difficult to document the productivity benefits of color

Paper Electronic

Benefit = Value - Cost

Value– Readability of document– Accuracy of message– Response to document

Cost– Equipment– Toner– Ink– Paper– Downtime– Management– Creation

0.0

1.0

2.0

3.0

4.0

5.0

6.0

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Copy Color

Copy 21+ ppm

Copy 11-20 ppm

Copy 1-10 ppm

Color Page

Page 21+

Page 11-20 ppm

Page 1-10 ppm

Units (M)

Western Europe

Is Color Replacing Monochromein the Office?

If you could make one improvement to color printers, what would it be?

Faster, Faster, Faster —A Perennial Problem

0%

5%

10%

15%

20%

25%Increase Speed

No Improvement

Lower Cost of Consumable Supplies

Better Quality

Lower Hardware Cost

Reliability

Improve Paper Handling

Lower Noise

Ease of Use

0%

5%

10%

15%

20%

25%

30%

35%

40%Presentations

Business Reports

Sales and Marketing

Office Applications

Word Processing

Spreadsheets

Others/Don't Know

What Is Driving Color Use? (2 Years Ago)

0%

5%

10%

15%

20%

25%

30%

Total

Business Reports

Presentations

Sales and Marketing

Word Processing

CAD/Engineering

Graphic Arts

Photo Output

Internet

Spreadsheets

Others

What Is Driving Color Use? (Now)

Users Moving Into Laser Color —Was Your Most Recently Acquired Printer …

0%

10%

20%

30%

40%

50%

60%

70%

80%

2000 2002

An Additional Printer

Inkjet Printer

Color Laser

Mono Laser

Others

Don't Know

Color Laser Takes the OfficeWhat Is the Technology of Your Most Recently Acquired Printer?

0%

10%

20%

30%

40%

50%

60%

70%

Laser Inkjet Others Don't Know

1998

2000

2002

0%

10%

20%

30%

40%

50%

60%

Hardware Consumables Support Others

Cost of Ownership Is ImportantCost Factors Considered When Purchasing

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

One Color Printerper User

Shared NetworkColor Printer

Neither Don't Know

Percentage of Respondents

Sharing Color Printers Is PreferredIn a Small Workgroup Would You Prefer….

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Color Page

Copy Color

Units (M)

Western Europe

Is Color Replacing Monochromein the Office?

0

50

100

150

200

250

300

350

400

1997 1998 1999 2000 2001 2002 2003

Units (K)

Western Europe

4-Pass

Single Pass

Color Laser for Different Usage Patterns

Desktop Color Printers

Inexpensive to buy

Expensive to run

Color is often used to print even draft documents

Coming in under the radarof IT departments

Put Desktop Printers in Their Place

Rising Speeds, Falling Costs

Technology Battle — Ink or Laser

Small workgroups that need affordable color output should consider business color inkjet printers as a companion to monochrome laser printers

Before selecting a color printer, users should know how many color pages they will print each month and calculate the running cost

Specialists in device consolidation can help rationalize output from printers, copiers and facsimiles, saving money while providing insight to affordable small-workgroup color printing

Consolidation of personal inkjet printers to a small workgroup's business inkjet printer that is shared on the network can provide lower total cost of ownership with improved cost controls

Where Does Multifunctionality Fit?

Copier vendors rapidly transition to digital technology– All copiers will soon be MFP-capable

Inkjet MFPs strike a blow to print-only products– Massive price erosion makes MFPs affordable

– Performance improvements

– Quality improvements

– Ease of use

MFPs displace sales of stand-alone printers – Flatbed displaces sheetfed

Action Item: Help your customers to understand their needs to achieve the right mix of equipment — this will maximize their savings and productivity benefits.

Benefits of MFPs

Productivity Fewer mouths to feed (supplies, service and

maintenance) Fewer assets to acquire and track Space and power savings Shared finishing and paper supplies Moves documents faster and at lower cost

Copier

MFPs reduce fleet sizes and operating costs

Network Printers

Multifunction SystemsCopyPrintFaxScan

Copiers

Printers

Fax Machines

Scanners

Migrating from analog to digital

Large fleets that are aging

Often sit idle most of the day

Often an ignored item

Are MFPs the Answer?

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1997 1998 1999 2000 2001 2002 2003

Stand-Alone

Connected

Is Multifunction Having an Impactin the Office?

Millions of Units

Explosive Growth for Inkjet MFPs

0

5

10

15

20

25

1999 2000 2001 2002 2003 2004 2005

Inkjet MFPs

Inkjet Printers

Are Digital Copiers Connected?

0%

5%

10%

15%

20%

25%

30%1% to 3%

11% to 25%

26% to 50%

51% to 75%

76% to 100%

Don't Know

Comparison Personal vs. Network MFP

0 1 2 3 4 5 6 7

Scan to Workflow

Scan to Archive

Scan to E-mail

Scan to PC

Fax

Copy

Print

Network

Personal

Technology Battle —Ink, Laser, Print, Copy or MFP

Small workgroups that need affordable color output should consider business color inkjet printers as a companion to monochrome laser printers or workgroup and departmental solutions

Before selecting a color printer, users should know how many color pages they will print each month and calculate the running cost

Specialists in device consolidation can help rationalize output from printers, copiers and facsimiles, saving money while providing insight to affordable small-workgroup color printing

Where Does Multifunctionality Fit?

Copiers are rapidly transitioning to digital color– All copiers will soon be multifunction-capable, and many

will bring affordable color

Inkjet multifunction strikes a blow to print-only products– Massive price erosion makes low-end multifunction

affordable

– Huge performance and quality improvements

– Ease of use

Workgroup multifunction starting to displace sales of stand-alone printers

Leverage MFPLeverage MFPTechnologyTechnology

Leverage MFPLeverage MFPTechnologyTechnology

Get Ahead of the Get Ahead of the Color Tidal WaveColor Tidal WaveGet Ahead of the Get Ahead of the Color Tidal WaveColor Tidal WaveEliminate Some Personal Eliminate Some Personal

PrintersPrintersEliminate Some Personal Eliminate Some Personal

PrintersPrinters

Use Assessments Use Assessments for Guidancefor Guidance

Use Assessments Use Assessments for Guidancefor Guidance

Use Selective OutsourcingUse Selective Outsourcing to Buy Pagesto Buy Pages

Use Selective OutsourcingUse Selective Outsourcing to Buy Pagesto Buy Pages

Eliminate Aging Eliminate Aging EquipmentEquipment

Eliminate Aging Eliminate Aging EquipmentEquipment

Color Fits Well WithFleet Management Initiatives

Recommendations

Incorporate workgroup print function– Manageability– Network support– Productivity

Incorporate departmental copy function– Paper handling (input – output – A3)– Departmental productivity

Incorporate consolidation functions– Fax

Incorporate new productivityfeatures– Scan to e-mail, workflow

Recommendations

Think about value – A document’s value should exceed its cost

Consolidation of resources– Make the right technology choice

Educate users– To think about the types of

document creation• Color or monochrome

• Printed or electronic

Delivering the Value of Color

Malcolm Hancock

Principal Analyst

Digital Documents and Imaging Group