When Will HP Write the Check to Xerox?
When Will HP Write the Check to Xerox?
It has been about 20 months since I told the crowd I was speaking to at the RemaxWorld Summit in Zhuhai China that HP would buy Xerox.
Soon after, another speaker would educate the audience on how that was never going to happen. I believe anyone who says “that will never happen” is void of the ability to imagine.
That will never happen continues to show up and surprise the unimaginative.
I also spoke of the bigger threat for the remanufacturers. I stated it would not be the non-patent infringing new builds. It will be the OEMs as they fight to capture the aftermarket in a declining industry.
With all of the recent strategic developments between Xerox and HP, one could easily conclude they will soon share boardrooms. I vision the brand name “HP-Xerox” and here are a few reasons why:
- In this recent partnership, Xerox hands HP tens of millions in the supply business. Remanufacturing giant, Clover, will notice the impact of this along with any others that have been providing Xerox with non-OEM, HP supplies. Keep in mind Xerox has a massive population of HP printers on Managed Print Service contracts. Xerox to this day is recognized as the world’s largest Managed Print Services Provider. It would be hard to imagine that HP is going to allow someone else to pick up Xerox now.
- HP is still struggling to gain acceptance into the dealer distribution channel. Xerox would give HP that direct distribution which is something HP desperately seeks. HP understands the BTA channel is the path to contractual agreements. HP also sees this as the path to A3 placements (Note: I cannot see HP succeeding with their A3 focus. Those who follow my writings or watch my videos have heard me speak of the A4 revolution. The data clearly defines that over 80% of the A3’s in the market place could easily be replaced by A4 devices. Those who continue to beat the A3 drum will be recognized as product-centric organizations and will face challenges from customer-centric innovators.)
- Xerox will sell. Their “for sale” sign out front is not coming down. Xerox set up a holding company, have cut tremendous fat out of their infrastructure, and are continuing to align to Carl Icahn’s vision of being Xerox brand focused. HP is one of the few in the space which could afford the price and could also benefit from the acquisition. HP computer equipment would also add significant value to Xerox customers. HP has been ramping up its global finance business, and Xerox is unwinding theirs. Soon HP-Xerox will be delivering print equipment in DaaS models along with HP computer equipment. HP needs direct access to end-users, and I believe they will write the check to Xerox to get that access.
(When Will HP Write the Check to Xerox?)
Today all industries must have the ability to imagine what could be based on what should be. Those who still believe competition will stay as it was in 1990 will be surprised. The print equipment and its services industry analyst continue to make one major mistake. They keep looking toward the future through the lens of their memories instead of their imaginations. Too many analysts see the future as more of what things were, instead of what things will become or should become. Too many analysts are focused on making happy those they analyze. They tell them what they want to hear instead of what they need to hear.
In a market where revenues and print volumes are declining, HP and Xerox took a big step forward with this latest’s agreement. It would be delusional to believe either will begin walking backwards. During these unprecedented times of innovative disruptions, many strange bedfellows will emerge.
I will remind you, as I always do as I wind up, that status quo is the killer of all that will be invented. Don’t get stuck in the status quo.
The Toner Wars which is related to this topic.Have you found this article, “When Will HP Write the Check to Xerox?” helpful? You can also read Ray’s blog on
Ray Stasieczko is a forward-thinking and often controversial writer and speaker. You may not want to agree with everything he says, but you are compelled to read and listen. To do otherwise could spell doom.
He has called the imaging channel home for nearly 30 years and served in various roles and has contributed nearly 100 articles to the industry’s publications. Ray has also spoken at the RT Media Summits in Cairo, South America and China. You can contact him and watch him on LinkedIn.
Read Ray’s other blogs:
- Business Opportunities Offered by this Pandemic
- That’s a Lot of Toner For a Market in Decline
- The Toner Wars Between Cartridge Suppliers
- Make Your Printer Consumables Business Profitable
- When Will HP Write the Check to Xerox?
- The Imaging Channel is Not Alone in Needing Diversification
- Making Your Printer Consumables Business Profitable
- Are Acquisitions the Feel-good Drug in a Declining Market?
- Recognizing Disruption as a Creator and not a Competitor
- Managed Print Services is Not the Door to Managed IT Services
Ray, you’ve been predicting this for the last 6 years. The way you outlined this sounds very compelling, however, you’ve left a great deal out of your thesis which would counter your the ideas you’ve outlined. You might be right and this might happen, but when? Why not give us a time frame with your predictions this time?
Love this line Ray
“They keep looking toward the future through the lens of their memories instead of their imaginations. Too many analysts see the future as more of what things were, instead of what things will become or should become. “
Looking at HP, I miss the view of how Canon will fit in?
Canon and HP are close, when it comes to Laser, mono and color.
How do you see Canon in the deal?
Thanks Kim. This is a good question. Canon and HP have had a long-term, lasting and stable relationship for more than 30 years. So what will happen now with HP’s acquisition of Samsung printers and their new relationship with Xerox? This is the BIG question and many have their views on it. Does HP need Canon any more? What is your opinion?