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Why managed print services are worth a deeper look

This is the time of year when journalists go nuts doing look-ahead or look-back interviews, and I am no exception. One of the subjects upon which I feel I owe myself a better education is managed services related to printer technology, because I feel it’s one of those iceberg subjects. In other word, what you see on the surface is only a small piece of the total opportunity related to these technologies and services.

So, you may already know that the vendors in this area call this stuff Managed Print Services (or MPS), not to be confused with Managed Service Provers (or MSPs). Yes, I know, it bothers me too, which is while I’ll actually avoid using acronyms for most of this particular blog entry.

I’ve actually spoken already with two of the major printer vendors about their thoughts around this subject. This entry isn’t meant to be any kind of comparative view about their respective programs, I will just relate a couple of their core foci. (Wow, I actually got to use that word in context!) And, a disclosure: I have done some white paper work recently for one of the vendors that I am about to mention, OKI Data.

Dena Bernard, director of customers satisfaction and services for OKI Data, views MPS as an opportunity for printer resellers to build a more trusted relationship with their customers even as margins from straight product resales continue to decline. Businesses of all sizes are scrutinizing every facet of their IT infrastructure and managing printer lifecycles, as well as the consumables related to use them, has become a higher priority. There are several reasons for this, Bernard says, including the need for companies to minimize their capital budgets, regulatory compliance considerations, and even corporate sustainability/green IT initiatives.

“Printing costs are not well understood,” Bernard says. “Many companies are undergoing downsizing and they are seeking to minimize costs. Being able to help them understand their printing cost and helping them control them in a way that matches their printer needs. This is a valuable skill set.”

Realistically speaking, any reseller that continues to base their printer business solely on earning hardware margins will find business tougher over the next three years as fewer businesses buy printers outright and more seek to establish a leasing or managed service relationship. One analyst firm, The Photizo Group, believes the growth rate for these services will be 25 percent into 2010. Growth for straight business printer sales, on the other hand, will be flat at roughly 6 percent.

OKI Data isn’t naive enough to think that a solution provider will be able to just drop all its other business practices in order to get focused on managed print services. It is, in effect, hedging its bets by creating a wide range of special printer technology, managed support services and programs that allow many different elements of the channel to become involved. These services all sit under an umbrella program called Total Managed Print and include everything from a starter program that pays the VAR an agent fee up to special equipment designed for members of the channel that are staking their entire business on these services and solutions.

“This is a program for the channel built by the channel,” Bernard says. “It lets the partner plug in at their level of capability.”

Xerox has been developing its U.S. managed print program for the past three years (it started in Europe about five years ago), according to Tom Gall, director of value channel marketing, who represents the Xerox PagePack initiative.

The rallying cry for Xerox is helping IT solution providers talk about printing in terms of the cost per page. The challenge in establishing manage print services within accounts is the relatively long product lifecycle for printers: It is rare that a company will switch out more than one-third of its printers in any given year, says Gall. That said, that sort of behavior just begs for a managed services approach, under which customers can have better visibility into where their true costs lie, he says.

Both Xerox and OKI Data believe that providing the services and infrastructure so that their partners can manage heterogeneous printer technology (instead of just their own devices will be critical). Equally as important: Both vendors believe that the partners who will be successful with managed print initiatives are those who dedicate human resources to this challenge: a managed print champion, if you will.

I’ll leave you with this video about PagePack from Xerox and a couple of its channel partners.

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