The Top 10 Trends of 2013

The office technology, solutions, and services world is changing and those on the inside had better be prepared for those changes. That’s not meant as a dire warning, but a heads up to keep abreast of changes because many of them will likely impact your business one way or another. With that in mind we’ve assembled, with the help of a few friends, ten trends to be aware of in 2013. The impact for some of these will be enormous, the impact of others, time as always will tell.

1. Watching and waiting to see which MFP vendors will fail, fall or be acquired
That’s what Brian Bisset, editor of The MFP Report, is doing who identifies Sharp, OKI, and Lexmark as likely candidates for acquisition. Likely acquirers include Samsung, Kyocera, and Toshiba. We’ve heard some of these rumors before and more often than not that’s all they are, but no one doubts that the industry will likely see some additional consolidation if not this year then in the near future on both the manufacturer and dealer side of the business.

2. Lower hardware unit selling prices and lower unit sales
“You’re going to see a 4-5 percent overall decline in the office copier space,” predicts Tom Callinan of Strategy Development. For buyers, the price of hardware may be right, but if you’re a reseller this trend ought to make you take a long, hard look at ramping up your solutions and services offerings to fill in the gap.

3. MPS margins will continue to disappoint dealers
“What we’re seeing is, while margins start off very high when you first get into MPS, they erode rapidly when the contract renews because it’s the same service,” opines Lou Slawetsky of Industry Analysts. “You may have done all kinds of workflow [analysis] and saved them all kinds of money, then somebody else comes in and says I’ll save you more with the same workflow.”

He also takes issue with analysts who are forecasting 30-, 40-, 50-percent year growth in the MPS market. “They’re not forecasting growth in terms of total pages because total pages are not growing,” argues Slawetsky. “If you take 100,000 pages off a copier and put it on a printer and put it under contract, you haven’t grown the market you just changed the way it’s paid for. The one thing the dealers keep ignoring is who owns the equipment at the end of the contract. So they’re billing for some liability and their margins are declining.”

4. Page volumes continue their downward spiral
No surprise here in that we expect to see a continued slow decline in total page volume and page volume per device. “It’s part of an overall trend where the marketplace is losing pages,” reports Jon Bees, an analyst with InfoTrends. “There’s a lot of different causes: the conversion of paper-based workflows to digital, the poor economy and the high unemployment rate. The emphasis on green initiatives will also be one of the headwinds for print.”

5. Emergence and growth in mobile device capture as a threat to ad hoc scanning on office MFPs
Mobile phones and tablets are being watched closely as a threat to print, plus the displays are of such high quality that in many cases they can replace the printed page. “IDC research shows a high interest in printing from mobile devices,” states InfoTrends’ Bees. “It hasn’t really happened yet and how this plays out in the coming years is open to discussion.

Clearly, in the longer term it will be negative for print. However, there are a large number of users that have expressed they want to print from their mobile devices so the jury is still out. It’s a threat but we don’t know how big a threat. Research shows behavior is changing but it’s a slow change. Adoption of smart phones and tablets is off the charts; however, penetration of tablets in business is still small, but it’s off the chart for growth rate.”

6. Opportunities for workflow
With all this talk about mobile printing and the emergence of mobile printing apps, what sort of a revenue opportunity will this truly represent for the reseller channel? “Lots of people are talking about it, I don’t know how it will change anything because the technology is catching up,” acknowledges Tom Callinan of Strategy Development. “What’s going to happen and a trend people need to get in on if the industry is to remain viable is workflow. It ties into everything we’re talking about—the low end of MPS being commoditized and people not going after the high end. With the overall markets declining about 4 percent, the question is how do I get revenue out of it? The way to get revenue, believe it or not, is to help people get where they’re going anyway, which is using less paper. How do you do that other than swapping a box for a box? You go in and look at their workflow and how they’re using communications with mobile being a big part of that communications.”

7. Vendors and dealers ramp up investments in IT services
This is happening throughout the industry with the most visible examples being Konica Minolta’s 2011 acquisition of All Covered and Toshiba’s announcement of a new services division where IT-related services will be a sizable component. Meanwhile, more dealers are either dabbling in or ramping up their IT services offerings. And just as with MPS, some have been more successful at that than others.

8. Cloud-based technology offerings become even more commonplace across the industry
There’s no shortage of folks in the imaging technology industry talking about the cloud. From office technology companies like Sharp who demonstrated cloud-based service offerings at their dealer meeting last summer to document management firms like DocuWare and DocuLex, the cloud is expanding technology, solutions, and services capabilities and will continue to have a big impact in future product introductions even though the forecast is hazy for where the revenue from cloud-based applications will come from. “I keep wanting to say the cloud is super important, but I can’t figure out how,” says Industry Analyst’s Slawetsky. “It’s like saying training is good, but you can’t quantify it. It has to be good. We’ve been on the cloud for a thousand years, e-mail, uploading digital photos—those are up in the cloud. What I’m saying is there’s nothing new in that, but there’s a difference in how it’s being positioned. I’m not sure if the dealer or somebody has figured out how they can make any money at it.”

InfoTrends’ Bees also weighs in on the cloud. “That’s where documents are going to be stored. It’s going to be so cheap to do it and security issues are going to be addressed. It’s a very important thing. Watch for the further integration between MFP vendors and cloud vendors like DropBox. It’s just a no-brainer for tighter integration between devices and the cloud.”

9. Big dealers keep getting bigger
In the metropolitan areas dealers doing more than $30-million in business a year are growing. The same goes for dealers in rural areas doing more than $12 -$15-million primarily because manufacturer direct branches are cutting back on their rural coverage. That’s according to Strategy Development’s Callinan. “A lot of these smaller dealers are either getting smaller or selling their base to the big dealers,” he says. “If you look at $100-million plus dealers, I think there’s more today than there’s ever been.”

10. Big Data = a potential big opportunity for resellers
This is an area where Mike Stramaglio, president of MWAi, sees huge potential even though this is something that’s still in its early stages. As we’ve reported on this before, Big Data refers to “all encompassing information and data flow from one company for another company.” There’s a good chance this will affect future solutions offerings from companies like MWAi who is currently working outside of print, but inclusive of print by providing software that allows an organization to collect data from scanners, routers, network services, elevator usage, and air conditioning systems, for example. Anything that requires monitoring and fits within their technology portfolio, a company like MWAI will apply that technology and reporting as part of their Big Data schema. Stramaglio sees this Big Data evolution as a great opportunity for dealers, especially since many companies have already been pursuing and compiling a Big Data portfolio. He expects that Big Data will find its way into the SMB market and dealer community in the next year or so. “It’s not MPS, it’s in the network servers that promote and/or support that dataflow,” he says.

Scott Cullen
About the Author
Scott Cullen has been writing about the office technology industry since 1986. He can be reached at