Peripherals: In Control

Printers constitute a significant proportion of the IT peripherals space with

numerous offerings based on the two dominant technologies-impact and the

non-impact. As we took the audit of the printer market performance during

2005-06, it revealed the firming up of trends witnessed during the previous

year. We saw the changing buyer attitudes and concepts such as print RoI gain

ground. The year gone by drove home the point that printer buying by

organizations were based on informed decisions rather than just adding another

printer. Enterprises did extensive due diligence and asked questions like - why

a new printer is needed, what is the TCO, what is the total running cost, will

it simplify my document management processes-these questions clearly point out

that the time of plain vanilla box pushing approach to printers does not work

anymore.

Hence vendors opted for a solutions approach to printing and in some cases

also acted as consultants to organizations to help them choose the best print

devices. For instance, all through the year, HP pitched hard its balanced

deployment strategy to the enterprises that enabled it to push mix and match of

various print technologies. In terms of upsets, the single function Inkjets

almost remained flat, with this segment hitting the plateau. The escalation of

inkjet MFDs has led to internal competition and thus challenged the single

function print devices, and in the bargain, standalone inkjet volumes marginally

thinned down during the year. The year also had ample pointers towards SMBs

migrating from mid-end inkjets to single function laser printers.

DMPs: Business As Usual



When the non-impact technology started making its presence felt in early

2000, doomsday pundits were busy writing off the DMP technology. Surprisingly in

the Indian context, DMPs have co-existed with the non-impact technology showing

market traction year on year. DMPs pulled out yet another routine year with

players such as TVSE, WeP, Epson and Lipi retaining their respective positions.

According to the vendors in the fray, the DMP market was characterized by a

robust growth across business and government sectors. The primary growth drivers

for DMP during 2005-06 were many and the significant ones such as VAT and SME

automation, altogether leading to 15% growth in this segment. Meanwhile, the

government emerged as a major IT spender over the year. Its investment in DMP

grew 25% over the year. Majority of these investments were towards

infrastructure and IT projects.  

Let us look at some vendor-wise performance. TVSE, the current market leader,

clocked a healthy growth. This consistent growth helped TVSE retain the number

one position. The company's DMP range-Proton showed lot of traction over the

year with a 100% growth to over 12,000 units this year. The product has now

accumulated a customer base consisting of brands such as DHL, Café Coffee Day,

E-Choupal, BSNL, Indian Railways, Bank of Baroda, and Andhra Bank. The success

for its Proton range was attributed to its design in terms of an integrated

stand and a roll paper with a low foot-print. If we take a look at the

sector-wise consumption of TVSE's offerings, retail and SME constituted 65% of

the total volumes, followed by government at 19% and BFSI around 16%.

Giving stiff competition to TVSE is Epson and WeP. WeP signed out with good

growth in DMPs as compared to the previous year. WeP witnessed good growth in

the 80-col segment primarily due to growth in the retail sector with 24-pin

136-col witnessing a jump owing to large automation projects in government and

BFSI segment. To better leverage its offerings, WeP also createdÂ

two independent business units namely CPU and BPU, the former focused on

channel business while the latter catered to large account business.

Epson is aggressively working on further increasing its market share by

focusing on the basics like further improving and harmonizing customer service

across all product categories, selling consistently and ensuring a good focus on

sell through from the reseller and retail market. In the high-end space, Lipi

has firmly established its brand and product offerings. Lipi is the only Indian

vendor that has consistently catered to the high-end DMP requirements.

Inkjets: Balancing Act



Single function inkjets, which remained almost flat during the previous

year, showed a decline in growth. Last year, as per estimates, single function

inkjets clocked 6.6 lakh units. And this time around, estimates pegged total

inkjet numbers for 2005-06 at about 6.5 lakh units. This clearly shows a decline

in number of shipments compared to the last year. While it is still the volumes

game, but values is where it takes the beating. The single function inkjets

hitting the plateau during the year was mainly due to customers migrating to

other print technologies such as lasers and MFDs. So vendors needed to enlist

new consumers and obviously they attacked the B and C class cities, where there

is a huge potential for peripheral devices such as low-end inkjets. SMBs bought

laser printers, which saw decline in price points, thus increasing the

affordability factor.

If we look at the ASV of inkjets over the year, not much of price slides have

happened. The prices of entry-level inkjets almost remained stable all though

the year at sub Rs 3K.

Meanwhile, companies such as HP took to bundling heavily during the year and

according to company sources, this made HP push more volumes of its entry-level

inkjets. HP vended four major categories of inkjets-single function inkjets

and photo inkjets, multifunction inkjets and photo printers. For other vendors

such as Canon, it's been a flat year on inkjets. For instance, Canon shipped

close to around 86,086 units of inkjets during the year. The company at the end

of the fiscal has also launched a slew of inkjet printers on the Pixma brand

name. Epson, meanwhile, was able to sustain its inkjet printers business and

shipped close to around 94,579 units.

Lasers: Gaining Ground



The single function laser printer market has demonstrated great traction

over the years and this is one segment of the printer space, which has carved a

distinct identity for itself. This is mainly due to the bigger RoI users getting

out of laser printers. With this in backdrop, laser printers pulled through

another glorious year, with volumes soaring. The dominant player without doubt

is HP, which commands close to around 71% market share. It's been a phenomenal

year for HP in the laser space. In the laser printer category, the entry-level

mono printers 15ppm-18ppm segment continues to dominate in terms of numbers.

Vendors such as Samsung are bullish about the growth of laser printers in the

coming quarters and expect significant market change during the ongoing year.

For instance, the mono laser printers volumes for entry-level workgroup network

printers-18 to 24 PPM-are expected to soar. Samsung also escalated its

presence over the year by launching four new models of laser offerings that

further expanded its laser portfolio. Another vendor that needs special mention

is Xerox. The company, which had a small share in lasers in the past, upped its

ante impressively. Over the year, it expanded its portfolio and now has a slew

of products catering the laser space. Xerox also positioned its entry-level

laser offerings as an inkjet alternate. These initiatives by vendors have kept

the laser volumes in the pink of health during 2005-06. Color laser offerings

also gained further inroads over the year with mid-to-high end segments opting

for it.

MFDs: The Juggernaut Continues



A rapidly growing space in printers, MFDs made significant in-roads during

2005-06. Yet again, HP drove the A4 Laser MFD market aggressively and IDC

estimates that HP has close to 58% market share in this space. Two kinds of

technologies are in vogue in the laser MFD space-printer-based and

copier-based and the debate still goes on, which is the best. While players

mainly cater to A4, MFDs bet hard on the printer based, other vendors mainly

catering the A3 laser MFDs are bullish on copier based. HPs emphasis in this

space over the last year was driving the value of its print offerings to the

consumers and in the bargain, it pushed more MFDs for environments that demanded

multiple forms of output needs.

Following HP, Samsung also attacked the MFD space aggressively. It launched

four new models of MFDs during the year, and now has a portfolio of seven

models. Meanwhile, Canon had a healthy year on laser MFD shipping around 10,986

units (A3 and A4 combined). It also shippedÂ

6,960 MFD inkjet units. Canon's product offering revolved around Pixma

range. Inkjet MFDs remained the domain of home consumers. For instance, inkjet

MFDs consumption patterns over the year revealed home segment absorbing around

45%, followed by small office at 40%, and the rest by other segments.

The escalation of MFDs in the printer charts over the year

clearly reveals its growing clout over single function devices. When we look at

pure play A3 laser MFD players, Toshiba leads the A3 segment with its Copier

based MFDs. Toshiba in the A3 category has done tremendously well. During the

year, it made reasonably good inroads in corporate segment and its growth in

mid- to high-end volume based segment has increased.

Meanwhile vendors such as Sharp advanced a whole new definition to MFDs.

Sharp has come out with offerings on document filing as much as 70 pages

filed in a minute, booklet making, combining different files such as Word, Power

Point, Excel into one document for a single command printing, paper-free proof

reading, mass mailing of circulars, are examples of how Document Management goes

far beyond the individual functions of a simple MFD and Sharp is aggressively

pitching on these value adds in its MFD offerings.