Ricoh's IKON deal ruffles feathers in office equipment channel |
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By Barbara Darrow, Senior News Editor
03 Sep 2008 | SearchITChannel.com |
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Ricoh's decision to acquire IKON Systems, one of its largest resellers, is shaking up the office equipment channel -- and perhaps the IT channel at large. The $1.62 billion deal is expected to close in the fourth quarter of this calendar year.
The channels for office gear and computers have traditionally been separate, but as copiers, multifunction printers (MFPs), scanners and other devices get smarter (and more networked), a channel convergence is underway. Hewlett-Packard, a major maker of printers and other devices, stressed the need for this convergence at its annual partner show this spring.
At that time, Vyomesh Joshi, executive vice president of HP's imaging and printing group, urged the vendor's partner corps to move office printers from analog to digital worlds and to network them. He estimated the value of the enterprise printing and imaging market at about $53 billion worldwide. Since most printers are still analog, leading that digitization effort is a big upgrade and services opportunity for HP value-added resellers (VARs), he said.
Malvern, Penn.-based IKON, with its 400 sales and service locations in North America, should bolster Ricoh's push into the United States. But the fact that one of IKON's major vendor partners is the buyer poses complications for competitive vendors -- especially HP and Canon U.S.A., both of which sell office gear through IKON.
Representatives from those two companies had no comment, but when Ricoh competitor Xerox bought Global Imaging Systems (GIS) for $1.5 billion last year, Canon U.S.A. pulled its products from the Tampa, Fla.-based GIS.
Converging the office equipment channel and IT channel at large
There was similar fallout when Konica Minolta Holdings bought Danka Office Imaging Co. in April. At that time, observers said IKON was the only independent office equipment VAR chain left. (Danka's current website leads with Konica Minolta imaging solutions but also features products from Kodak and HP.)
Vendors in the imaging and printing market are watching this trend carefully.
"This is the third and largest buyout" of a reseller by a vendor in the past two years, said Bill Brikiatis, director of corporate marketing for eCopy, a Nashua, N.H., maker of office equipment software.
In the case of these acquisitions, the acquired reselling company -- IKON or GIS or Danka -- has become so intertwined with its vendor owner that it's becoming a single-source provider. And that's not in the best interest of customers, Brikiatis said.
"Customers want options and to ensure that the software they're using remains the same, because that's where the biggest investment is," he said.
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