As the MFP market continues to win the overall printer popularity contest, consumers and businesses are switching to the technology for a host of reasons. Chief among them is the ability to integrate input and output devices into one system in order to get enhanced ease of use and cost savings.
Indeed, IDC expects solid unit revenue growth for the multi-function printer (MFP) market in Australia. The segment is expected to capture substantial share from the single function printer market.
The near-term forecast for 2004 shows unit growth of 22.8 per cent (62,186 units), and value-of-shipments growth of 29.4 per cent.
When compared with single function printer activity, MFPs remained the highest growth category in the hardcopy industry over the 2003 to 2008 forecast period, IDC said.
"Historically, the MFP market has been relatively smaller than the single-function printer and copier markets but the gap is closing," IDC senior analyst, peripherals, Loretta Pein, said.
She tracks the overall laser MFP market.
On the inkjet front, the continous growth of inkjet MFPs over single function inkjet printers saw the inkjet MFP market reach 205,000 units in Q2 2004, up 23 per cent quarter-on-quarter. Sales of inkjet single function printers, however, continued to decline, dropping two per cent from Q1 to 190,000 units in Q2.
IDC printer analyst, Su-Lin Ng, said consumers and small businesses were the primary target markets for inkjet MFPs and vendors would continue to educate and highlight the benefits to these market.
Promotions such as bundling and cash-back offers would help drive demand, she said.
Epson Australia marketing manager, Mike Pleasants, said the market was buoyant, in part, because businesses and home users were more comfortable with the idea of having one device for scanning, faxing, copying and printing.
"A few years ago, people were reticent about putting all of their eggs into one basket - if one thing goes it all goes - but that's not the case anymore with technology greatly improving," he said.
Consumers, particularly in the SOHO and SMB market, were digging the extra desk space, he said.
Pein said more buyers were beginning to switch to MFPs in increasing numbers as they could now see the advantage of combining all their needs into one device.
"The providers of the traditional hardware are now offering added functionality, finishing, managed and service options to fully exploit the need to integrate office functions into several convenient devices rather than a multitude of office machines," she said. The idea is to offer value-added document solutions.
Pein said MFP vendors had to help customers protect and add value to existing investments. Users were seeing the benefits of having print, scan and copy functions in one device.
All-in-one and photo printers take the cake
In addition to all-in-one device acceptance, Epson's Pleasants said the insatiable appetite for digital cameras was also feeding the MFP frenzy, along with demand for photo printers.
Epson was rolling out a line of Stylus MFPs that were suitable for text, photo printing and copying, he said.
The release was set to address the growing demand for better economy in printing, on both the business and home front, which fitted in nicely with the MFP concept.
Aiming to cut down on waste, the Epson range now offers individual ink cartridges so users can swap when the colour runs out.
"It has obvious advantages over older systems, the 3-in-one cartridges, which required users to replace all at once," Pleasants said.
The MFP range also offered DuraBrite pigment ink technology, which resulted in waterproof and smudge-proof photos, he said.
"We're catering to the photo market [offering photo quality output], adding more memory slots, and catering to the needs of the SOHO and SMB space."
DuraBrite is configured to perform best on a range of papers including plain paper.
In this space, along with the higher enterprise realm, consumers want the total package, Pleasants said.
Lexmark's A/NZ general manager for consumer and small business, Steven Waugh, agreed the all-in-one market was seeing a boost, and was exceeding single function inkjet sales in Australia by 10 per cent.
"We see this market progressively increasing each month," he said.
MFPs represented 70 per cent of company sales, Waugh said.
In the SMB space, the company was pitching productivity suite software (added to its newly released X7170 range), which aimed to cut administrative time and boost productivity, he said.
Other advancements include the ability to create multiple page portable document files (PDFs) from a variety of formats into a single document for storage and distribution.
All-in-one machines (which offer faster speeds, PrecisionSense automatic cartridge alignment and improved document management software) along with the growing demand for photo printers (with LCD colour screens, pictbridge technology, enhanced editing functions and ink longevity) were capturing attention on the home and business front, Waugh said.
On the LCD front, the text LCD screen helped users perform functions without the use of a PC.
A Gartner report stated that the inkjet all-in-one and 4x6-inch photo printers would be the growth areas of the consumer output device market over the next several years. Digital photo printing would become the primary driver of unit sales.
The colour laser MFP finds its footing
With the growing interest in the MFP market, Fuji Xerox Printers (FXP) was eyeing the space, regional sales manager, Paul Harman, said. The company already services the higher end of the market, but wanted to dabble in the lower end of town.
It plans to launch a host of laser MFPs - costing less than $1000 - into the SME space later this year, he said.
The technology had come down in price and now offered better value for businesses.
And while multi-function printers were increasing in popularity due to their space saving convenience, sales of single-function printers were also on the rise, Harman said.
Fuji Xerox Printers is experiencing record growth in single-function laser printers.
The single function growth can be attributed to companies looking for functionality including quality print output, high-volume print runs and multiply units for all areas of the office, especially for use in departments where a high level of confidentiality is required - such as HR and executive management.
Looking toward the colour laser MFP space, Harman said the company was pitching a mix and match approach, advising resellers to peddle an array of devices to suit different business needs.
IDC's Pein said the colour MFP space would be driven by the industry-wide push toward the B2C (black to colour) strategy.
"Within the next two years, vendors will replace monochrome and move into colour," she said. "There's a transition of the monochrome to colour base."
The overall colour laser MFP market would grow by 124.2 per cent this year compared with 2003, Pein said. It would also record a 2003-2008 unit CAGR of 40 per cent.
Price continued to be a big driver for the uptake of colour laser printers, particularly in the SMB space which could now print in colour using the laser technology at a lower purchase cost. Some prices had dropped as low as $800, IDC's Ng said.
In gearing up for the colour laser MFP push, Pein said the connectivity ratio would increase, which meant more companies would provide machines with a printer controller (as many vendors in this space come from a copier background). National product marketing manager for
Ricoh Australia, Bronwyn NeeCowen, said businesses were now more willing to pay the premium for colour on MFPs - which worked out to be about 20 per cent - given the technology has vastly improved.
"Looking at recent trends we see colour as the biggest driver," NeeCowen said. "It is similar to when we converted from analogue to digital."
Costs were coming down, while component reliability was going up, she said.
As such, the company expected 20 per cent of every MFP to be sold to be colour by the end of 2005, with that figure pumping up to 50 per cent by the end of 2006.
"Reliability and ease of use benefits are there, knocking off all of the obstacles for why IT managers wouldn't put the colour laser machines in the workplace," NeeCowen said.
Better engine designs, the addition of 4-colour toners, improved firmware, along with finishing capabilities (enhanced document management software) are having an impact.
As such, the convenience of colour would resonate with more than the specialty crowd (including real estate) and strike a chord with mainstream business, she said.
"The corporate world, the SME space for example, will start to look towards colour," NeeCowen said. "Finance, sales and marketing, as well as operations will consider it, and areas that previously didn't think they needed it."
IDC's Pein said the market would see an increased focus on office colour, along with higher laser activity from printer vendors (as most offering technology in this space are copier-based).
Other trends to hit the market in the next 12 months, she said, included a higher turnover of models (the lifecycle would be reduced from 18 months to 12 months), the roll out of next-generation machines (with better speeds), along with lower cost-per-copy (lower running costs of paper and consumables).
"A reduced total cost of ownership is key over the next 12 months," Pein said. "Production costs and R&D costs will decline."
She said the colour laser MFP sale offered a higher revenue stream for resellers.
"Selling colour models makes sense, even if you don't use it all of the time," Pein said.
The machines were often high volume gear, required ongoing maintenance and support, which was where the resellers fitted into the picture, she said.
"Vendors can't just box it up," Pein said. "They are a high involvement machine, offering full solutions."