Xerox, HP, Lexmark : The Greatest Transformation of a Niche Since the 70's Auto Industry

Remember transformations of the Past -

• The great computer dealership purges of the 1990's - Inacomp to Wal*Mart
• The music industry - vinyl to CD to MP3 to streaming
• The auto industry, 1970's, from V8 to 4cyl, from 400 HP to 100 horses running through front wheels

2/2016 -

Look what is happening to Sharp - the copier side of Sharp is viable and profitable - is it far fetched to see another 'spin-off' or will the imaging division continue to be a profit center for the whole?  Is an investment of $450M good money after bad ?

Lexmark has gone from the "long cool woman in a black dress" to having her parts examined separately.  Recent augmentations appear more valuable than the core.

HP just reported,

"...Printing remained challenged in the quarter with net revenue of $4.6 billion, down 17% year-over-year as reported or 11% in constant currency, with declines in all regions."

Turning to Supplies, revenue was down 14% year-over-year in Q1 about 400 people exited the company globally as part of the restructuring activities announced in September...we are accelerating the program and now expect approximately 3,000 people will exit by the end of fiscal 2016 instead of over three years."

Last year, Q1 2015, HP reported a 14% decrease print revenue.  Two years of down numbers?  How about 4 years?

Xerox -

In an article written by Stephen Hays, the chairman of Brighton Securities, George Conboy is quoted saying Xerox...

"is steadily on a downward path, especially in its equipment business. The demand for its technology is falling by the day. Though the company may not be staring at bankruptcy in the near future it is, however, facing a situation where it is slowly moving away from maneuvering paper documents and making copies. Meaning, Xerox Corporation (NYSE: XRX) is steadily shifting away from its equipment business as there is lesser demand for its technology..."

Outside pundits see, why don't our own?

Some might say the auto industry transformation was greater in scale and scope than our copier confluence but consider this: no other segment of business, lest IT, has had more impact in the business world that printing and copying.

Nothing in history compares.

Chevy Citation, anyone?

How can Lexmark, Xerox and HP change to remain relevant?

The car of the year in 1980 was the Chevy Citation.  A front wheel drive, side mounted radio, "Accord killer".  Parts fell off, transmissions locked and a generation of customers scrambled toward Toyota.

The OEMs continue to produce more of the same:

Is ink in the office akin to front wheel drive?
Is MPS the independent channel's CD?
Is managed services the next 5.25" floppy?

Either way, slow down and consider what is unfolding before our eyes - the greatest shift in business communications since the typewriter.

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Xerox, Lexmark, Sharp and HP: All Things Must Pass

In an article written by Stephen Hays, the chairman of Brighton Securities, George Conboy is quoted saying Xerox...

"is steadily on a downward path, especially in its equipment business. The demand for its technology is falling by the day. Though the company may not be staring at bankruptcy in the near future it is, however, facing a situation where it is slowly moving away from maneuvering paper documents and making copies. Meaning, Xerox Corporation (NYSE: XRX) is steadily shifting away from its equipment business as there is lesser demand for its technology..."

Wow.  Who woulda thunk? But who is surprised?

The vultures are circling Lexmark, HP just reported a 17% fall in print revenue, Xerox dividing and Sharp bouncing back and forth between China and Japan - all add up to the most dynamic imaging environment since the Great Rikon purchase of 2008.

2016 -

More experts are recognizing something we've been saying here on DOTC since 2008 - The Death of The Copier is upon us. They're talking bankruptcy and comparing Xerox with Kodak.

People outside of the imaging niche, folks who don't sell toner, copiers, printers, document management software, MpS, print 'big data', online marketing, dealer websites, copier sales training classes, MpS programs or save trees - articulate how the demand for copier/print technology "is falling by the day."

The wave is just over your shoulder.

Who is your biggest competitor, today?

• The direct branch across town? No.
• The mega-dealer over the state line? Negative.
• The toner pirate on the other side of the tracks? Nope.

Today, your competitor is Time.

Tic Toc

It might be too late.

Smaller dealerships with lower overhead serving the SMB, may survive.

Larger companies will sell out or wash away.

The medium sized dealers, their employees and families, will take the full brunt of the on-coming wave.

After the flood, the sun will rise on a landscape full of opportunity and promise.

A new day, a new Way.  Without print.

"Printer jams, how novel. Did you know there is no paper in the future, or should I say no future in paper?"

- Matthew, Continuum, Season 2, Ep. 2, "Split Second"

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Apple, The FBI, ISIS and You - The Internet of Everyone

"The United States government has demanded that Apple take an unprecedented step which threatens the security of our customers. We oppose this order, which has implications far beyond the legal case at hand.

This moment calls for public discussion, and we want our customers and people around the country to understand what is at stake." - Tim Cook

This issue has implications beyond the disgusting terror attack in San Berdoo - and as much as we despise ISIS and its followers, I can't help but believe that today's request by the FBI is more slippage toward that Orwellian vision.

One of my gripes with Google is their disregard for our privacy - invasive advertising, location detection, etc., etc.  If Apple gives in, they become nothing more than a prettier Google and Google is a sieve; so is Windows.

"Dominoes Fall"

"We have great respect for the professionals at the FBI, and we believe their intentions are good. Up to this point, we have done everything that is both within our power and within the law to help them. But now the U.S. government has asked us for something we simply do not have, and something we consider too dangerous to create. 

They have asked us to build a backdoor to the iPhone."  -Tim Cook

Here's the point: Its obvious iPhone is one of the most secure phones in the business, not even the FBI can break in. It's what I expect from Apple.

Some argue Apple should "do the right thing" and open up to the authorities.  Of course, Apple is doing the right thing by securing our personal data.  This is foundational to a digital existence.

From printers, and Netflix to your phone, today's world logs your actions and is subject to outside observation.  Current generations unfamiliar with life without the internet, accept this openness.

But there should be an island of privacy.  Apple gave us a slice with the A7/8 chip.

Assuming the unlikely event that Apple prevails, the FBI, indeed the US must find another way:

• Patch up the holes in our immigration process.
• Intensify anti-ISIS marketing.
• Neutralize them in their backyard.

Whichever side of the dispute you fall on, remembering why we're arguing either point is most important:

• ISIS put this in the headlines.  
• These two murderers pushed the FBI to consider data on an iPhone.  
• Radical belief forced Tim Cook to release a letter of explanation.

The erosion of privacy isn't a result of a heavy-handed government or a weak corporation. The assault is born from ancient people who loathe your freedom.  We must defend freedom from all directions at every instance.  From the copier to your phone.

"Ideas are Bullet Proof.."

Everybody in the Gov't has a gun: The FBI, Homeland Security, Immigration, FDIC, USPS, and even the IRS.  ISIS has guns, HUMVEE, and steak knives.  The fear 

Apple has ideas.  In the end, Apple will probably lose this fight.

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