11/2015 Mergers, acquisitions, sell-outs and less paper. 2016 will see the beginning of the End.
More signs. The tipping point is in your rearview mirror, if this is news to you, it's too late.
Today, Xerox may be running out of ink with quarter after quarter of declining technology business. They've also decided to scrap the wax.
Lexmark, after years of building a portfolio of MPS contracts is finally ready to sell out.
HP, the thickest of the thick, is splitting into two. HPG, (HP Inc.) can now move quicker and turn their profits into R/D for print. Will this five billion dollar start-up be the last print vendor standing? Can the old Printelligent model work? Mother Blue has been adding vans almost as fast as she's laid off employees. She has an impressive array of services, and a behemoth of a team ready to take the argument to the streets - direct.
Samsung may gobble up Nuance, enhancing a practically non-existent MpS program.
The independent channel continues to shrink and evolve. Just this week, Loffler joined the Xerox dealer channel and Marco cashes in, selling to an equity firm.
On top of all this, the American Forest & Paper Association released their yearly report stating, "...total printing-writing paper shipments were down 4% in September as compared to September 2014." The same report a year earlier sited a 7% drop from 2013 to 2014.
Taken individually, the list has one dimension.
But observed from a distance, and just to the side, these points reveal a multi-dimensional reality: The deluge is here.
Knee deep in a receding surf for the last 18 months the final Wave is coming. If you haven't sold or gotten out the only choice you have is to hunker down and hope for the best.
So what does it mean?
The End is just the beginning...ask yourself this one question,
"If office print disappeared tomorrow, what would I be doing the day after?"
Whatever answer you come to, you are absolutely correct.
These thoughts are my personal critique of an industry, not an individual.
Weeks ago, over one hundred leading MpS providers congealed in Park City, Utah to discuss the future of MpS. It was a great educational and entertaining event - recommended.
This event was one of the best I've attended in years - only the MWAi show from last year, stands above. West put together a great agenda and was able to recruit a diverse set of industry luminaries.
Here's a quick list of observations from The Top 100 - "MpS is Changing" conference:
The venue: Superb.
Event organization: Stellar.
Promotion: Unparalleled.
Presenters: Both gargantuan and irrelevant.
Content: Both significant and forgettable.
Off-line conversations: The best in over a decade.
For a detailed tracking of the event, talks, and feedback, see Ken's, Art's, West's, and Andy's most accurate reports.
The video, recorded, edited, and presented on-site, nearly live, is one of the best promotional pieces in the niche. It was organic and fun. See it here.
Enough of us patting each other on the back, like we’re all buds. Here's a two word summary of the show: "Points Missed."
It has been said our niche moves at the speed of an HP Series II - I don't agree with that 100% of the time, but after this conference, I'm having second thoughts.
I've stewed on this for what seems years - why do so many still believe in the old models? Why don't they see what others see?
In a juxtaposition with the best content I've witnessed, the audience comments were befuddling. I sat there, shaking my head, not at the presenters(mostly) but frustrated over the 1970 mentality of the audience. Still!
Here it is. A list of call-outs from my perspective:
"Automatic Toner Fulfillment": 2007 called...
"If you sell hammers, everything looks like a nail" so, if you sell re-man toner, all the world is an empty printer, right?
ARRRG.
Getting toner to the right desk at the right time is something we've cut our teeth on, back in 2007. Staples delivers more toner to more desks, on time, "automatically" than anybody else and they use people. Automation for automation's sake is not visionary.
The fact that we are looking at ATF as a new advantage, in 2015, is trite - Clients expect every MpS program can 'get toner to the user' as a mundane function.
There is no such thing as "MNS": Really.
This irks me on a personal basis. Nobody in real IT refers to anything as managed network services; it is simply managed services. Whenever we say "MNS", we look like wanna-be, IT knuckleheads. If you're IT contacts don't flinch or roll their eyes every time you say "MNS" they are being polite.
When the Epson dude referred to his ink bags as "disruptive", I think most in the room assumed it was we doing the disrupting.
Immediately, calls of, "how can I make money the old fashion way, when I sell the machine and lifetime ink all upfront?"
The answer is, "you can't make money the old-fashioned way..."
But here's the miss: we won't be using ink-bags to disrupt, this disrupts Managed print Services.
It's the other way around: bags-o-ink AND "Instant Ink"(DOTC, 2011) will move the channel closer to irrelevancy. Not because wet-toner is better than dry-toner - the iceberg here is "Lifetime Supply". Buy a printer and never purchase toner or ink again. All the costs, revenue, and profit are upfront. An offering, so simple a monkey could sell it.
The 'lifetime' model will remove MpS from the lexicon because there is no need for a relationship.
Those MPS consultants and OEM programs that stress toner as "the most important component" of MpS have led us down the primrose path.
This one issue, redefined as "MpS" is slipping from the dealer channel into the hands of surviving mother-ships.
"Toner" is not a relationship and the biggest reason OEMs say they need an independent dealer channel is to maintain the relationship. Well. The relationship is getting thinner every month.
Think about it, the 'lifetime ink' business model eliminates:
Meter reads - no billing
Monthly billings - see above
Deliveries - UPS
Phone orders - machines phone home
Service calls - these things don't break
Quarterly reviews - why?
Contracts
Independent Dealers
Etc.
If I were getting into managed print services today, I would become an Epson reseller and push those guys to start releasing model after model, ASAP, before HP kicks their super-duper, closed loop MpS machine into gear.
I mentioned this during the Q&A, and nobody understood what I was saying.
...chunks...blown...
points...missed...
Watch Epson. Watch HP MPS.
In The End: It's Not Me, It's You
I've seen great things in our niche. I've seen companies make the leap, shun the old ways, and thrive.
I've also seen organizations espouse the future, make cosmetic changes and fail - the road back to 1991 is littered with used-up MPS Directors. Settling into the old ways of selling copiers, hiring sales managers from yesterday's enterprise, 'trapping customers', paying salespeople a pittance yet expecting them to be professionals, and forcing equipment quotas on their customers - is the easy thing to do.
I've been ringing the bell for years - "MPS is the gateway to something bigger than toner and copiers...". I evangelized the new ways only to see big equipment manufacturers hijack and kill innovation, searching for more shelf space and stickier schemes.
It is the way of things.
But it doesn't need to be your way. Many have made the shift, pivoting off the copier and into fertile markets. It isn't easy to break free the ordinary ways, but it's got to be done.
Conferences that break the mold, separate the future from the past are few and far between - this Top 100 is one of the less ordinary get-togethers. If you were there, you are one of the less ordinary people and nowadays, the Life Less Ordinary is the life evolutionary...
"Chew, if only you could see what I've seen with your eyes!..."
From coast to coast, I've seen the promise of MpS scattered to the four winds as companies reject the outsource model, bring MpS in house only to realize they don't want anything to do with supporting print. Ironic, but what do they do?
Go back to doing nothing.
The days before MpS...
It was different back then - copiers sold for $15,000.00. Color images were as much as 18 cents each and users generated 2,500 copies a week. (or was it 5,000?)
Copiers inhabited every floor and printers popped up everywhere overnight.
"Purchasing" or "Facilities" generated RFPs, negotiated for the cheapest CPI, signed leases, and dropped the entire project over to IT and the receiving department.
IT would complain to themselves, struggle with a copier technician connecting this huge, unknown machine - possibly integrating LDAP or creating user folders on a shared server or the unit's hard drive - all the while lamenting the difference between these clunkers and all the printers and scanner that easily hung off the network.
This entire process was unmanaged and costly - very costly.
Today, as old-fashioned copiers die off, relegated to government or educational accounts, A4 prices fall while generating fewer images, the real cost of print is approaching, but never reaching, zero. (See Limits)
Soon, instead of running internal assessments, generating an RFI, then an RFP, evaluating suitors, negotiating price, running lease and contracts through legal, signing a five-year lease/service agreement, scheduling delivery/removal, connecting to the network, installing ATF software, conducting end-user training and experiencing a 90-day spike in copier related help desk traffic, customers simply order a printer online, for under $2,500.00 including lifetime ink supply.
Done.
No copier demonstration.
No comparing OEM to drill and fill toner.
No back-end points on a 60-month lease.
No stair climbers.
The days of $25,000.00 Edgelines and 5250i's are gone. Gone like a freight train and terminus is right back where we started - a sku, a price, and a delivery date.
Now, more than ever, fewer employees require a printer and if they do, devices are so cheap, there's no need to invest time into developing an RFP. The decision process takes no more effort than a few mouse clicks. As the cost of print shrinks and blends into operational overhead, the primary reason for MpS, cost reduction, vanishes.
So what do we do?
Continue and keep going. Leave MpS, copiers, and ATF in the rearview mirror - someone will always want a copier or a printer. Consider plumbing as a service, HVAC as a service, heck, think about interior design as a service - the Universe is calling.
Like the copier before it, MpS revenue will approach but never reach, zero...Remember, right this very second, somebody on the planet is making and selling buggy whips.
