HP hints at Netflix-style printing scheme
Faced with slowing growth in developed markets, HP could be considering a radical step to pull in more enterprise IT business: a move to monthly subscription-based printing services.
On Friday, Vyomesh 'VJ' Joshi, head of HP's imaging and printing group, told ZDNet UK the company is looking at a new business model that should be coming "soon — very soon".
He would not be drawn about the model, preferring to confirm guesses. Here's how the conversation went, at an event for press and analysts in Dublin:
VJ: Let me give you a hint. Think about what changed the DVD market. What did Netflix do? ZDNet UK: Made it easy for you to get something immediately...? And every month you had to pay...? Pay a subscription. So that could be a very interesting way. So rather than paying for what you use, you pay a subscription, and the use could go up and down? People will be able then to really do something different, right? That's the business model innovation I'm talking about.
HP's printing unit has been trying in the past few years to reinvent its approach, as enterprises warm to web-based collaboration such as Google Docs and as its tools make office printing more efficient.
Its recent pitch is as a provider to turn 'atoms to bits to atoms' — meaning its products can move information from something physical, to digital, then back to physical again.
Changes in the top management at HP have cast some uncertainty over this strategy, the product of years of planning. There have been rumours that HP's printing arm will be sold off, like its PC business. It’s also not known whether Meg Whitman, the incoming chief executive, will want to shake up the unit.
Joshi acknowledged the changes, but was upbeat about the prospects, saying HP's printing will continue on the same path it has followed for the past five years.
"It's been a year of extraordinary change," he told the Dublin audience. "But we are very resilient. I'm confident in Meg's ability to lead us forward, and that we will come out of this even stronger."
The company's e-Print tools, which allow people to send documents directly from devices to web-connected printers, are part of its modernising push. It updated the e-Print range earlier in September, adding an app for iPhones and iPads, and announcing a BlackBerry app that will arrive next month.
HP is also getting ready for next year's launch of its TopShot LaserJet Pro M275, which scans objects in 3D to produce a 2D image that can be printed or uploaded directly to a Google account or cloud-based service.
Even so, traditional printing will remain key to HP's overall business, company executives said at the Dublin event.
"The relevance of printed output is as strong as ever — but the actual output is changing," said David Ryan, general manager for inkjet printing and supplies for HP EMEA. Self-produced marketing materials and on-demand book printing are two areas HP is making a push.
While Ryan acknowledged that HP's smart printing features lead to customers using fewer supplies, he believes the company can make up any losses from its managed print services.
"We can get less money from the toner, but we can get money from managing the overall solution," he said.