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Imaging Index: A Financial Wrap-Up of this Month's Document Technology Market

15 Feb, 2005 By: Mike Dudek imageSource

Imaging Index: A Financial Wrap-Up of this Month's Document Technology Market


Each month we track changes in stock
values of major public players in the imaging industry. The following chart
depicts the change in value from September 30, 2004 to December 31, 2004.

Global and Adobe are off to fast
starts, as each company stock gained 27 percent last quarter. In addition, Xerox
(21 percent), Canon (15 percent) and HP (12 percent) realized double-digit
growth. Last year’s leading gainers, Danka and IKON, are in the red for the
first quarter this fiscal year at -17 percent and -4 percent respectively.
Overall, the stock portfolio increased 10 percent ($16 billion) in value last
quarter; however, the market did take a hit in early January 2005, so tune in to
next month’s article for updated results.

Latest Industry Developments

A Copier Dealer’s Dream Comes
True—Close your eyes and just imagine being a copier dealer, document services
or imaging firm when someone informs you that they are going to digitize every
book that has ever been published. Are you excited about this opportunity or are
you just dreaming?  Is someone telling a bad joke? Perhaps not.

The Internet search firm Google
recently announced a collaborative deal with the Oxford, Harvard, Stanford, and
University of Michigan libraries and the New York Public Libraries that entails
converting those institutions’ books and other document holdings into digital
files that can be searchable over the Internet.

Google has apparently agreed to
underwrite these projects while adding technical capabilities to the task of
scanning and digitizing tens of thousands of pages a day at each library. The
projected cost is estimated at $10 per book with more than 15 million books and
other documents involved.  Supposedly, this project could take a decade.
Initially, the project is expected to be labor-intensive with personnel placing
books on scanners to capture each page.

The Library of Congress and a group of
international libraries from the U.S., Canada, Egypt, China, and the Netherlands
also announced a plan to digitally archive a million books on the Internet. It
is expected that 70,000 volumes will be completed by April.

Opinion: You will likely see more
technology developed for these projects, such as page-turning and scanning
tools, to make such undertakings more efficient and less labor intensive. In
fact, see Xerox’s announcement below.

Question to Dealers: Which industry
players will benefit from these major conversion projects? Are any of these
projects going on in your markets?  How can you take part?

Xerox: In seemingly related news, Xerox
announced that two of its scientists have developed software that eliminates
dark areas and distorted words that occur when books are scanned.  A
"de-warping" factor compensates for geometric distortion that occurs when the
center of a scanned book is pressed against the glass.  This patented software
process apparently can be incorporated into scanners and will be added to new
Xerox technology and will be available for license.

Other Xerox news includes its
announcement of a three-year, multi-million dollar agreement with Staples for
the installation of nearly 5,000 digital color and B&W printers and copiers in
Staples 1,100 stores.  

Opinion: It doesn’t seem that long ago
that Canon announced a similar arrangement with Staples. Xerox and Canon seem to
volley the Staples opportunity every few years; you can be assured at very
competitive prices.

Xerox, along with EDS, also announced a
$40 million contract with Barclays Plc to supply a "Workplace Management
Services" solution to manage office document services for print, copy and fax on
a page-per-page basis. This Workplace Management Services solution is a
co-branded EDS and Xerox offering that integrates advanced IT and document
management tools to increase productivity and reduce costs. EDS and Xerox will
manage Barclays procurement, service and help desk for 2,250 devices in 200
locations with 40,000 users in the U.K. This arrangement is part of a much
larger deal that EDS has with Barclays. 

Opinion: Xerox continues to leverage
its capability through large technology partners to major clients. Both Xerox
and HP are leading the pack with such mega-deals. What will the other large
manufacturers do as these giants take over the large customer machine

Danka: Announced the acquisition of
Image One Corporation, a printer services company with revenues of $6 million.
Image One conducts business in Michigan and Ohio and provides printer services,
HP printing systems and supplies to a reported 1,300 customers. Danka indicated
that its strategy is to become the best independent provider of print and
related services in targeted markets.

Opinion: The acquisition of printer
service companies is a trend that will continue. Major industry players are
building and buying capability to service all output devices for their
customers. I am personally working for a number of clients in this particular
space, and the trend is very obvious.

HP: Collaborated with CDW Government
Inc. on a $1.3 million printer deal with the Garland School District in Texas to
supply 600 HP laser and inkjet printers and 40 scanners for its 64 K-12 campuses
and 15,000 students.

Oce: Announced a new 30-page-per-minute
color printer; and named Bill Pugh its VP of operations for North America, which
targets commercial and corporate print rooms.


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