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Will China be the World's Largest Market for MPS?

According to research firm IDC, shipment of printers in China over the first half reached 5.8 million units, a year-on-year increase of 36.4 percent, because of the economic recovery. Yet the annual growth rate of the market is expected to be dragged down to 14.6 percent, as demand for printers tapered over the first half.

Doc has always been humbled by the rapid adoption of technology in China. So I was a little surprised to read in the China Daily recently, that even though there is a huge market for printing devices in China, the market for Managed Print Services (MPS) has not really taken off. But that doesn't mean it won't soon.

Here's just a glimpse of what China Daily had to say:

China's printer and copier industry is betting on managed print services (MPS), rather than traditional hardware sales, as the next big thing.

To increase their presence in the industry, major printer and copier makers are doubling their investment in MPS, a mainstay of outsourcing which frees users from choosing and buying machines and daily maintenance.

According to research firm IDC, shipment of printers in China over the first half reached 5.8 million units, a year-on-year increase of 36.4 percent, because of the economic recovery. Yet the annual growth rate of the market is expected to be dragged down to 14.6 percent, as demand for printers tapered over the first half.

Though the MPS business is only just beginning in China, where selling services is less widely accepted by people than selling machines, it is forecast to grow rapidly in the years ahead.

China's MPS industry totaled $248 million last year, and it is expected to increase to $1.72 billion in 2014, with a compound annual growth rate (CAGR) of 47 percent, higher than the forecast 22 percent CAGR globally over the same period, figures from US-based research company Photizo Group show.

Market players, therefore, say they need to make a great effort to educate the market and expand their footprint.

"We are not seeing yet a lot of MPS around the small and medium-sized enterprises or the governments in China, but it is one of the markets with greatest growth potential," said Edward Crowley, chief executive officer and founder of Photizo. He added that the main challenges in the MPS market lie in people's awareness of the benefits of the service.

There's a lot more in the article, including how various MPS vendors are approaching the market. If you're thinking of doing business in China, it's worth a read.