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Software Insight from ScanSoft

7 Dec, 2004 By: Robert Weideman imageSource

Software Insight from ScanSoft

ScanSoft has been a big player in the software solutions business for several
years now, pulling in nearly $30 million in document imaging revenues in the
first half of 2004. The company has partnered with not only Microsoft, which
licensed its optical character recognition program TextBridge, but OEMs such as
Xerox and HP. The company currently has six other document management/imaging
programs out on the market (See sidebar).

ImageSource had the opportunity to speak with Robert Weideman, senior vice
president of worldwide marketing and product strategy for Scansoft, and a
20-year software industry veteran. He shared his insight on the present and
future impact of software on the SMB market and independent dealer channel.

imageSource: At one time, document imaging was mainly used in Fortune 500
companies, but now small to medium-sized companies are seemingly in the market
for these applications, what has enabled this?

Robert Weideman: The biggest thing is Microsoft is making it easier for
people to deploy it. Five years ago, people would buy a FileNet system or a
Documentum system for content management and they would spend a million dollars
for the software license. They would also buy a production capture system from
people like Kofax and buy high speed scanners that cost $20,000.

What Microsoft SharePoint does is it condenses down most of the things a
smaller organization would need and makes it easy to install and makes it much
more affordable. It’s easier to implement document management and that’s driving
up the need for easy-to-use scanning, affordable OCR (optical character
recognition) and PDF products.

Now what’s happening is scanning is becoming something people can do by
pressing the green button just like they use to do to make a copy. Imaging is
becoming part of the work process where in the past it was part of processing
business systems. It’s becoming more practical for medium and small companies to
take advantage of. Our PaperPort product, which is our PC document management
application, grew 40 percent last year.

IS: So your advice for a dealer would be to enter solutions sales if they
hope to fill this demand in the future?

RW: No question. When resellers essentially just sold copying machines, the
solutions they were selling to differentiate themselves were machines that
stapled and hole punched and the speed of the machine.  All of them basically do
the same thing now. From a consumers point of view that makes it a commodity.
It’s something they can get from a lot of people, so they start talking price
and go for the best price they can get.

When these devices are now viewed as part of not only creating paper and
copies, but part of a work process, it becomes a solution not a commodity. Once
a customer implements a business solution that works, they don’t move off those
solutions as quickly as they might if the only difference between what you sell
and the other guy sells is how much you are charging per click or for toner.

IS: How do you envision the future of the document solutions business as far
as the copier industry?

RW: I believe every successful dealer will be selling their products as a
solution. I think if people want just a printer they are going to buy that from
Dell or go to Comp USA. They are not going to go through a dealer. There just
isn’t a reason to. It used to be a printer was hard to set up. It’s not hard to
set up anymore. It used to be a scanner was hard to set up. It’s not anymore.
The value-add you used to get from the dealer coming in and configuring the
machine, people are past that. That has been solved and been made simple. Why
would I call a dealer?

IS:  I have heard dealers say their salespeople are not comfortable selling
solutions because it is an unknown to them, will the applications become easier
to understand and implement down the road?

RW: Yes. That’s the natural progression of technology. It is easier now than
it used to be. Frankly, the dealer community is going through a transition right
now where they historically didn’t have to be that PC literate or that software
literate. But not only will the dealer community become more comfortable with
it, the user community will become more comfortable with it.

For example, email was around for 20 years before 1995. It went from nowhere
to everywhere in two years and the reason was two fold. The first was, prior to
Windows 95, to get email to work you had to have a TCP/IP stack, which is used
to actually communicate with the Internet. Even if you had email configured, no
one had it. Microsoft simplified TCP/IP. They made it so you turn on your PC,
type in your password and you were up and running. It was after that people
began using it. People said, “Wow, I want to use that again.”

Scan to desktop and document management isn’t email, but for the business
world it is the same thing. Once people start using it and they say, “Wow, that
felt good. I want to do it again,” it is going to proliferate even more. Once
dealers show people how good it feels to get rid of paper, use email to
distribute documents and eliminate FedEx expenses and fax paper, things will
start to permeate.

IS: How does the dealer benefit from solutions sales?

RW: Most dealers I have dealt with are entrepreneurs. They want to make
money, and software costs money and software like this can drive services. And
it can drive a closer relationship with the customer than what you have today.
It’s an opportunity for more revenue. Paperport costs $200 a PC, not expensive.
But if you have 80 people at an insurance company, that’s a nice addition over
and above whatever the copier is going to cost.

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