Today, printers. Tomorrow, 'integrated peripherals'?

With less office printing going on, printers are struggling to redefine themselves and are evolving from passive devices as vendors cram more features into them

Out went 42 aging black and white copiers with interface boxes that let them serve as printers. In went 42 new networked multi-function printers (MFPs) that could do color printing and copying and scan directly to e-mail, fax or files. And the owner, the Park Hill School District in Kansas City, MO, saves $19,000 yearly.

"Scanning has been huge, as we progress into the digital age and move accumulated paper resources on-line," notes the district's director of technology, Brad Sandt.

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His experience appears to be part of a global trend, which has been happening for quite some time: As more documents are being read on screen rather than on paper, printer vendors are scrambling to offer their mid- and high-end users MFPs that scan, fax and copy as well as print. (Sandt's Konica Minolta units also staple, punch holes and do saddle stitching.) They can be integrated into business software to, for instance, automate document workflow. And they can still print, of course.

Printing's ebb

The search for a new role for mid- to high-end office printers apparently stems from a realization that the paperless office, which pundits have been predicting for decades, may finally be happening. Based on feedback from its clients in North America, market research firm Gartner Inc. has concluded that the number of pages printed in offices per month per employee has fallen from about 1,000 in 2005 to half that in 2012, says Gartner analyst Federico de Silva.

"When was the last time you created a document in hardcopy?" asks De Silva. "Instead of printed handouts in meetings, managers supply electronic material."

Printer manufacturer Hewlett Packard has seen less dramatic reductions, says David Laing, an HP product marketing director. "In emerging markets we are seeing a dramatic growth in the volume of pages being printed, but in mature markets we are seeing very small declines year over year," he says.

As for printers themselves, market research firm IDC reports that the global demand for hardcopy peripherals grew less than 1 percent in 2011, and actually declined 3.4 percent during the last quarter of the year. But within that sagging market, MFPs ruled, showing annual sales growth of 17 percent.

Meanwhile, making printers that cost less while printing more pages per minute with higher resolution appears to have reached the point of diminishing returns. "Cheaper, faster and better has all been taken care of," notes Larry Jamieson, analyst at the Photizo Group, a market research firm in Midway, KY.

Vendors are instead relying on new features (as with MFPs) and marketing initiatives to differentiate their products. These include processing power and native apps suitable for integration into workflows, remote printing, security features, contractual purchasing with more favorable terms and managed print services, where the vendors set out to optimize a customer's printer "fleet."

New apps

MFPs have been around for years but the new generation includes processors and memory that support user-accessible applications, touch screens for local control, published APIs to help link up with computer applications and workflows and network interfaces so they can be shared by multiple end-users.

Many MFPs can perform ad-hoc scanning to a file or a certain application, but the latest MFPs can perform a more sophisticated task called transaction capture, says Harvey Spencer, head of New York-based Harvey Spencer Associates, specialists in data capture.

Mike Morper, vice president at Notable Solutions Inc., an integrator in Rockville, MD, describes a typical MFP-based transaction capture solution: A user logs on and selects an application from a list on the MFP's control panel, such as "Submit For Remittance" when processing an invoice.

The screen will then ask for basic information, such as the invoice number, amount and the vendor name. For the last, the software will access a database server through the office network and present the user with a list of vendors with open purchase orders. The user picks the correct vendor, presses a button and the invoice is scanned. The image will then be sent to a separate application processor, which can extract further information from the invoice via optical character recognition, Morper explains.

"We are seeing adoption by the same users who jumped on the capture concept 15 years ago," Morper says. "But instead of sending all your documents to a central mailbox you can have the subject matter expert put one or two documents at a time in an MFP and deliver them to the [correct] business process."

The down side is that an integrator must support about 500 different MFPs, he adds. "Devices from the same vendor may not be that much different, but devices from different vendors can be as different as Windows and Macintosh. Starting from scratch, it can take four to six months to build just the client to run inside a device," Morper says. The software underlying MFPs' control panels are about evenly divided between proprietary systems, Java and browsers, he adds.

Meanwhile, data output by the MFP needs to be in any of about 30 software formats, such as IBM Content Manager or Microsoft SharePoint, many of which are subject to periodic revision, he adds, so the MFP software will also need periodic updates.

Certain printers have built-in or downloadable apps, including ones on HP MFPs that let customers print out current weather maps or news summaries from the web. But compared to the hundreds of thousands of apps that have arisen for the iPhone and Android smartphone environments, pundits are not impressed.

"These are convenience features for users who want some quick information off the Internet," says Keith Kmetz, vice president at IDC. This setup "may not be an ah-ha thing that drives technology." HP will be shipping a software development kit later this year that should encourage MFP app proliferation, Laing says.

Remote printing

The vendors have also been rushing to support remote printing for their networked printers, to support the growing throng of mobile device users. There are various ways to do this and none has become standard.

For instance, the HP approach includes giving each printer an e-mail address to which the user can send files. But since the application doing the printing does not reside on the printer, the printer can only print files in certain standard formats.

Another example is Konica Minolta, some of whose printers can connect via Wi-Fi and print in PDF, Microsoft Office and most image formats, says Dino Pagliarello, head of product marketing at Konica Minolta.

Xerox's approach involves the user e-mailing a document from a smartphone to a print server inside the organization's firewall, where the user can get it printed after inputting a code that the server sent to the smartphone, says Shell Haffner, manager of desktop product marketing at Xerox. The document is printed by the application that produced it, he adds.

Security issues

With printers relying on networking, in theory they are exposed to hacking. But sources dismiss that danger, saying there are too many safeguards.

"I think it's a tempest in a teapot," says analyst Jamieson.

But there are other serious security issues, as spotlighted in a CBS News special report that ran in April 2010. Reporters went to a warehouse stocked with copiers that had been returned from lease, bought four and examined the contents of their hard drives for images of documents that the machines had copied or scanned. They found lists of sex offenders in Buffalo, NY; 95 pages of a construction company's pay stubs with Social Security numbers; plans for a building in Manhattan near Ground Zero and 300 pages of medical records.

"Before the report, none of the vendors were encrypting the data on the hard drives," says data-capture expert Spencer. "Now, they all do."

Other forms of security include authentication procedures intended to control use by identifying the users. Each user can have a configuration profile that limits or monitors his or her use. For instance, only users in the marketing department might use color and all users might have a limit of how many pages they can print. Authentication can be done via log-in, or with card or badge readers attached to the print server, as is the case in the Park Hill school district.

"Anything costing more than a thousand dollars has security features that let you control access," says Jamieson. "It's a matter of actually implementing those features."

Indeed, "We have more than 1,500 security features, but most customers have no idea what they are and how to use them," acknowledges HP's Laing. So HP has come up with an interface involving seven questions, which sets the options based on the answers, he adds.

Sources add that limitations are also sometimes imposed based on the application that does the printing. For instance, software that prints e-mail may be limited to black and white, while spreadsheets and PowerPoint presentations are allowed to use color.

Sandt says that most of the Park Hill district's savings came from an 11 percent reduction in printing that resulted from the use of pull printing. He also found that, previously, 8 percent of printouts were never picked up, which poses a security risk.

Contractual issues

Monitoring who prints what is important for financial as well as security reasons, since higher-end printers are typically acquired with service contracts that include replacement ink or toner (and possibly paper). The buyer is charged for each page printed, at a rate typically lower than the retail cost of ink or toner. Park Hill's Sandt, for instance, said he was able to cut his district's per-page cost for color printing by 70 percent through this kind of contract.

Sources agree that the going rate is a penny or two for black and white, and eight to 13 cents for color. But if you print an e-mail that includes a single URL with a blue underline, is that a color page? The answer varies by vendor.

For instance, Haffner says that Xerox's software differentiates between strict black and white, tiny uses of color, moderate uses of color and full color. The system will charge the black and white rate if there are only underlined URLs, and half the color rate for spreadsheets with highlighted cells, he says. Color brochures are, of course, charged the full color rate. Around 70 percent of use falls into the black and white or partial color category, he adds.

Sandt, whose contract is with Konica Minolta, says that one URL will cause a page to be charged for color, so the print drivers are set to gray-scale by default. Individual users, meanwhile, have a quota of color pages they can print.

Managed print services

If a printer fleet is going to have features in place to monitor costs, the buyers also want to use them for planning purposes, and the vendors will often offer to help their efforts through an arrangement called managed print services. Laing says HP commits to reducing costs by 30 percent when it undertakes such a project.

"Many larger firms are doing it, and now even small- to medium-sized businesses are paying more attention," Jamieson says. "The vendors are telling them to replace under-used machines with shared devices to remove unnecessary costs."

Such services have been a leading reason for the adoption of MFPs, says Barbara Richards, a consultant at Infotrends, a market research firm in Weymouth, Mass., because they let users cut down the number of devices they own, providing cost savings if only by cutting power consumption.

"You don't see stand-alone copiers anymore, you see printers with scanning, faxing and document management," she says. "It's a double-edged sword for the vendors, since they don't want to lose business up front. They have been very savvy about that, and have been offering workflow solutions. The MFP is the on-ramp to all that."

Getting the most from your printer

These features are widely available among different printer manufacturers.

Use shared printers: Sources agree that workgroup printers can often replace four or five desktop printers. These can be acquired with a service agreement that has a negotiated per-page cost that should be lower than that of any of the replaced units.

Right-size your printers: Laing at HP notes that printers that can handle 11x17-inch sheets cost about 30 percent more than ones that only handle standard letter-sized 8.5x11-inch sheets. In addition, only about 3 percent of the office paper sold in the US is 11x17-inch, making it unlikely that an organization needs many printers that can handle that size.

Replace fax machines: Sources agree that faxing sheets of paper is expensive and should be replaced with electronic alternatives, such as electronic faxing or e-mail. Dedicated fax machines need dedicated phone lines, which must be installed and then generate extra costs. Also, fax machines with thermal ribbons typically have a per-page cost equivalent to that of a color laser page.

Adopt pull-printing: The use of pull-printing can cut the number of pages being printed by 20 percent to 30 percent, says HP's Laing, since the users tend to plan their work more and not discard printouts. The user prints to the network instead of to a specific printer, and then goes to a print server, logs in and selects from his or her available print jobs, which are then generated at the attached printer. As an additional benefit, output does not sit unattended on the printer until the user gets there, posing a security risk.

Go duplex: Duplex or two-sided printing is widely available on office printers, reducing paper costs. True duplex printing means that users do not need to turn over the page; if that step is needed, then it is not really a duplex printer.

Lamont Wood is a freelance writer in San Antonio.

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