Opinion: Printer resellers under fire

I can't remember when I wrote my first article about managed print services - definitely before 2005. At the time the idea made a lot of sense. With managed print a company could bundle the leasing, maintenance and supply of all printers and multi-function devices and their consumables into a pay-per-use contract.

As long as the reseller kept the contract competitive, the company needn't worry about buying toner or knowing when to retire old, inefficient printers.

Skip ahead five years and it's a big surprise to see that vendors are still talking about managed print as the Next Big Thing. Why has it taken so long to take off?

One answer comes from a reseller, I spoke to last week, one which has only just got into managed print. Datacom is a big systems integrator known for its managed services. It decided to extend from IT management into printer fleet management and has seen its business boom.

In 15 months Datacom has picked up 1800 machines under management in Western Australia and it picked up another 3000 from Queensland in eight months.

Datacom has just rolled its service into NSW.

Datacom hired Mathew Frederickson to run this new division. Frederickson has worked in the copy industry for 16 years, most recently as a facilities manager for a national copy company.

Frederickson was scathing about printer resellers' inability to understand managed print services. Printer resellers are just about moving boxes and getting service revenue through the door, he said.

He believes that managed services experts like Datacom are going to eat printer resellers' lunch because they understand the customer value behind managed services. And that, it seems, is more important than understanding printers.

I checked with Datacom's printer vendor, HP, and interestingly it has equal numbers of printer and IT resellers on its books selling managed print services.

Each has their own advantages over the other and completely different sales approaches," says HP's Richard Bailey. "Also the structure of the companies is generally different. IT companies have fewer staff selling large deals and copier companies have many staff selling many smaller deals.

"Neither of the two are able to simply switch over to sell as the other does as the copier companies need IT knowledge and the IT companies need experienced print/copy sales staff."

I also had a chat to my counterparts in the US about managed services. Ed Moltzen, a senior editor at CRN (US), said that Xerox and HP have had the most success in North America, particularly Xerox, which has driven programs hard into the reseller channel.

A lot of vendors have wanted to get into managed print but haven't got the training or the technical support just right.

Any kind of managed service is sticky and a great way for a reseller to sign up recurring revenue and get to know the customer's business.

Have Australian printer vendors taken too long to get their managed print services strategies right? They've certainly been talking about it for a long time.

Resellers are losing customers to managed print resellers, Oki told me.

With all the consolidation happening around the transition from break-fix support to managed IT support, perhaps we're about to see the same in managed print.

The interesting question is - will it be the IT players providing that managed service - or the printer resellers?

Head shot: Sholto Macpherson, editor, CRN