Canon buys Oce....why?
Posted on Mon, Nov 16, 2009
As we have seen lately, there is a fair amount of consolidation in the copier & printer marketplace. We have seen Ricoh acquire Ikon in an effort to ‘push' more Ricoh equipment. We have seen HP and Canon team-up in the belief that partnering will result in the sale of more equipment. This week, we saw Canon in the news with its acquisition of Oce. Again, the acquisition appears to have been made in an effort to sell more hardware...this time in the production printing space.
Here's the link... http://news.yahoo.com/s/nm/20091116/bs_nm/us_oce
It appears many of the copier-based companies have come to the realization that there is far too much capacity in the market. At a conference last week, a Xerox VP noted customers have far too much copy/print capacity and the market for 60+ page/minute devices "were sinking like a stone while the workgroup MFPs (20-50 page/minute devices) were continuing to increase in popularity." We have seen this product shift with our customers for the past several years. In addition, we're seeing the life expectancy (reliability) of workgroup devices extend well beyond the traditional 3-5 year useful life of those higher speed copier devices.
With the recent poor financial performance from Xerox, Canon, and Ricoh, it appears the copier industry is set for more consolidation and partner agreements. Across the industry, beyond the negative trends at Xerox, Canon, and Ricoh, copier companies are cutting back on their sales, marketing, service, and R&D capabilities. As an example, Xerox builds very little product today...most of the lower speed MFPs are manufactured by Samsung; the higher-end devices made in conjunction with Fuji or other manufacturers.
From our perspective, the impact of the above consolidation will not be dramatic to our customers or our company. It should also be noted that LaserNetworks has completed two acquisitions over the past 24 months. These were service-focused and geographic acquisitions, made to create more capability and value for us customers across North America.
Regarding the copier acquisitions, my belief is that until the copier companies create a business model that first addresses the customer, instead of a model focused on selling more hardware, we'll see continued profit erosion from these companies, and therefore continued consolidation in the copier industry.