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Software is focus for document hardware comapnies October 16, 2008

Posted by Julian Bradder in Uncategorized.
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The big players in document hardware are making gainful strides into software markets. Recognition that software is the key enabler in processes of ever increasing complexity and value dawned upon hardware manufacturers some years ago. But only now is the vision of the big hardware players bearing fruit in the market.
In talking about these companies, I would include in volume mail production markets companies such as IBM, Xerox, EMC, Pitney Bowes, Cannon and Hewlett Packard.
EMC, Hewlett Packard and Pitney Bowes seem to be deriving the most customer value from this business model. Hewlett Packard has always had the advantage of being able to leverage a huge installation base and relationships with big customers that reach far, wide and deep into today’s large organisations.
Pitney Bowes has been notably visionary, forcing a seismic shift in the market. They have been particularly clever, grasping and embracing market convergence and recognising that the end product of all customer relationship thinking has to be it’s communication with its customers.
If a company fails to communicate effectively with it’s customers then with the exception of monopoly, the end is obvious.
More finished mail items touch Pitney Bowes product than anything else on the planet. Pitney Bowes is at the heart of mail production whether through the huge SME market sending out 10-20 letters a day to the biggest high volume mail production facilities on the planet. Some customers of Pitney Bowes send out in excess of 1 billion mail items per year. What Pitney Bowes lacks is knowledge and products in the print market from which to leverage its position.
Hewlett Packard’s acquisition of Exstream software brings it in the same ranks as Pitney Bowes. The Exstream product is possibly one of the best selling products on the market at the moment. Hewlett Packard with its wide spread of print capabilities and deep relationships with customers will do well.
What it does lack however is production mail room expertise and this may be a weakness when making propositions to customers who want to include control as a key requisite of implementations.
IBM make printers, big printers. Printers that serve the largest organisations in the world. They talk at every level with today’s big companies. From the senior executive to basic office functions, IBM nearly always show their presence. They are strong. They know software, hardware, strategy, professional services, integration and outsourcing. They can punch and they can deliver.
Hardware giant, EMC also pursues a similar strategy with its recent acquisition of Document Sciences. In fact their business model does look very similar to that of Pitney Bowes.
It is going to be very interesting watching this market grow and seeing what customers take up out of the enormous product portfolio’s of these big players.