Printing and Imaging

Low-cost laser printers and MFDs are driving the Indian printer market, says Atanu Kumar Das

As PC sales crossed 9.21 lakh units in Q3 2004, the associated market for peripherals grew robustly. The apex hardware body, Manufacturers’ Association of Information Technology (MAIT) estimates that the PC industry will comfortably touch the four million mark for fiscal year 2004-05. According to IDC, the overall IT market is expected to grow by over 35 percent in 2005. Peripheral market vendors expect similar growth for their segment. Be it monitors, MFDs (Multi Function Devices), keyboards or mice, most vendors are very upbeat at the progress of the peripherals market as a whole. 2005 is expected to be the year for flat-panel monitors as customers become more stylish and technology-savvy. The SMB market is also expected to be a big contributor to the growth of the IT industry as more small and medium companies adopt information technology.

Printers

According to MAIT in OND 2004, on a quarter-on-quarter basis, laser printers witnessed a growth of 90 percent followed by Dot Matrix printers at 80 percent and Inkjet printers at 30 percent. The dot matrix printer market in fact has seen a huge revival with increased buying in traditional markets such as government, BFSI segment and new markets such as retail and education. Special billing applications for VAT implementation is expected to drive IT growth among SMBs.

According to N Sambamoorthy, General Manager, Business Products, Epson, niche applications such as policy statement printing will fuel growth for DMP printers.

The potential of the printer market is evident from the spending pattern of Indian SMB customers. A report by Ami-Partners’ shows that Indian Small Businesses spent $285 million on printers in 2004. This is expected to increase at a CAGR of roughly 24 percent over the next five years. The Indian SMB market is currently dominated by inkjet and dot matrix printers. The same report says that among enterprises in the medium business space, dot matrix printers are the most highly penetrated (71 percent), followed by inkjets (70 percent) and laser printers.

Flat-panel monitors are making waves in the industry R Manikandan General Manager, Sales & Marketing (IT) LG Electronics	We introduced a couple of new models in the MFD segment last year, and have seen a great response Alok Bharadwaj vice president Volume Group Canon India	We grew at 25 percent in 2004, and I feel that the market will grow by at least 30 percent in 2005 Rajiv Bapna Director Amkette India	We believe that we can increase our share by marketing products with value-added features Sameer Shah Country Category Manager Imaging and Printing Group HP India	Samsung has seen its MFD business grow exponentially by over 250 percent Princy Bhatnagar Head, Value Business IT division Samsung India	Niche applications such as policy statement printing will fuel the growth of DMP printers N Sambamoorthy General Manager Business Products Epson

Low-cost lasers

Another big trend is the emergence of inexpensive laser printers. The low-cost laser market is growing at 25 per cent. Natesh Mani, Executive Director, New Office Group, Xerox India, reveals, “We grew (in 2004) by more than 30 per cent in the sub-10k laser printer market and hope that we will grow even more this fiscal year. We have outlined a new channel strategy towards this goal.” Vendors believe that the SMB segment will fuel the growth for low-cost laser printers.

Says Aseem Kumar, Senior Manager, Value Product Head, Samsung India, “Our customers are primarily corporates and small and medium businesses”, and adds that the company is looking at a growth rate of 100 percent in the coming year.

Sameer Shah, Country Category Manager, Shared Printing and Connectivity, Imaging and Printing Group, HP India, asserts, “We are the market leader in the sub-10k laser business. We have been growing faster than the market and believe that with more products with value-added features, we can increase our market share.”

All-in-Ones

Colour is the catchword in the all-in-one segment or multi-functional device segment (MFD). Most vendors expect that colour MFDs are going to be the order of the day as prices have started to fall steeply, and believe that the MFD segment will grow at more than 100 percent growth rates. Market leader HP for one is seeing good growth in its colour MFD business. Shah of HP India explains, “We are growing at 200 per cent in the MFD segment and our channel base has helped us achieve this.” Colour has also become affordable and the ratio is 1:4 if we compare the same to black and white MFDs. Earlier colour printing cost 20 times more but in the last two years, prices have dipped phenomenally. HP is working closely with its specialised channel partners to promote its products and today has more than 140 colour certified resellers across the country.

Vibhor Bansal, Country Category Manager, Color in Office, HP India, hopes: “By the end of next fiscal the number of our colour certified resellers is going to increase by another 50 to 60.”

Another player, Samsung, has seen its MFD business grow exponentially, by over 250 percent as compared to the previous year, according to Princy Bhatnagar, Head, Value Business, IT division of Samsung India. While increasing volumes pushed prices down last year, this year vendors believe that more functionality would be added for the same price.

Colour is a segment which Samsung expects will grow phenomenally in the coming fiscal. Samsung operates with dedicated regional distributors in MFDs unlike their other businesses where they have national distributors. “Our regional partners put in a lot of effort to develop the market. While last year we tapped only nine markets effectively, we have expanded to cover 23 cities this year. This has helped ramp up Samsung’s volumes,” says Bhatnagar.

Similarly, Canon has seen good growth rates in the MFD space. Alok Bharadwaj, Vice President, Volume Group, Canon India, says that Canon has been growing phenomenally in the MFD segment. “We have introduced a couple of new models in the MFD segment last year and have seen a great response. We expect to grow by more than 30 percent in MFDs in 2005 over 2004.”

Natesh Mani, Executive Director, New Office Group, Xerox India says that Xerox is the market leader in the A3 size MFDs with 20 per cent market share. “We have also recently introduced our A4 segment MFDs, to compete with HP and Samsung.” Xerox does not have any A4 products in the US market but specifically launched the A4 MFDs in India as the market potential is huge. The company has enhanced its channel base and structured its distribution model to address this segment.

Another emerging trend is the use of high-end MFDs that start upwards of Rs 1.5 lakh. Typically, a high-end MFD is defined by the production rate of 20 pages per minute (or higher) and features such as e-mail alerts for low ink, distant document sending and password protection. Players such as Canon, Xerox, HP, Toshiba and Lexmark are trying to develop this market through a focus on value-added features. For example, you can send a handwritten note from your chairman to 500 locations across the world at the same time using a MFD. A common communication platform for the dispatch of a file over multiple media such as e-mail, fax, Intranet or the Internet is a plus for organisations looking to buy high-end MFDs. This provision also lets virtual teams collaborate by giving them a common virtual dock to post project status updates and views over the Internet or Intranet.

Flat-Panel Monitors

The flat-panel monitor market saw a strong surge in 2004. This has been primarily been due to a drop in prices. An entry-level 15-inch LCD monitor now costs Rs 13,000 compared to Rs 18,000 last year. Four million PC monitors were shipped in 2004, of which the LCD market accounted for 6.5 percent. This is expected to go up to 10 percent in 2005. The concept of flat-panel monitors is increasingly gaining traction among Indian customers.

R Manikandan, General Manager, Sales and Marketing, IT Products, LG Electronics, explains, “Flat-panel monitors are making waves in the industry. The TFT LCD (Thin Film Transistor Liquid Crystal Display) monitors are catching the market’s eye. Also, with the monitor as the only visible part of the PC (the CPU is now going under the desk), the customer is now looking for a more aesthetic look. This is directly leading to a spurt in demand for TFT LCD monitors, as they look different.”

According to Bhatnagar of Samsung India, “The flat-panel market has grown by more than 150 per cent in 2004, driven largely by infrastructure needs in the corporate space. Flat-panel monitors will remain the fastest-growing category in visual display products for next three years. We expect a CAGR of 45 percent for the next three years in this segment.” Bhatnagar also adds that Indian corporate demand has been the key driver for TFT purchase. Benefits like zero radiation, low power consumption, no eyestrain, and space saving are key factors for corporates to make a higher capital investment towards TFTs. With the lowering of TFT pricing in the last six months, vendors expect TFTs to penetrate the home space. Corporates are also converting their CRTs to TFTs. LCD monitors are finding high usage in public display terminals and corporate boardrooms.

Manikandan explains that LCD monitors have shown a good presence in market segments like call centres, financial institutions, corporates and government where there is growing demand and awareness. “In India, the LCD monitor market is expected to grow at a rate of 200 percent in 2005 over 2004,” he adds.

Keyboards and Mice

According to MAIT, PC sales are going to touch 4 million units in the 2004-05 financial year. The size of the input device market is expected to be 50 percent more than this because consumers tend to change keyboards and mice more frequently than other PC devices. Most vendors and resellers are hopeful that the keyboard and mice market will grow at a healthy rate of 30 percent, and are coming up with new technologies to attract customers such as the optical mouse.

Says JP Bansal, Director, Intex, “We experienced a growth of 40 per cent in AMJ and JAS quarters as compared to the same period last year.” Another vendor, Adcom, has grown 100 per cent in H1 2004, as compared to H1 2003.

Bharat Bhushan, CEO, RR Systems, says that business in input devices has been good and their company has seen 30 per cent growth in 2004 over 2003. He expects the market to grow by 35 per cent in the coming fiscal.

Most vendors including Microsoft feel that with the increase in penetration of PCs, the input device market will grow. Microsoft is planning various promotional offers in the coming fiscal to increase its share in the keyboard and mice market, reveals Mohit Anand, Head, Home and Entertainment Division, Microsoft India.

LG Electronics also launched its new range of keyboards and mice in 2004 and the company’s Manikandan says, “We were a late entrant but we are coming up strongly in the input device segment. We plan to aggressively market our keyboards and mice in 2005 to increase our market share. We will also be coming up with specific channel initiatives, to enable more channel participation for our products.” Wireless input devices comprise another segment which is gaining impetus.

According to Rajiv K Bapna, Director, Amkette India, “We have recently launched our wireless keyboards and mice and this is our endeavour to cater to the enterprise and SOHO market. We have two products in this series and we will be launching two more variations in the next six weeks. We grew at 25 percent in 2004, compared to the same period in 2003 and I feel that in 2005 the market would grow by at least 30 percent.”

Another big segment that is opening up for input devices is the notebook market. Logitech India is aiming to gain leadership in the relatively new segment of notebook interface devices. Many corporate users who are accustomed to working on desktops prefer using a cordless or optical mouse while working on their notebooks, instead of the in-built trackball. As the notebook segment is currently enjoying a burst of frenetic growth, there is a big opportunity for notebook interface devices. Says Moninder Jain, country manager, Logitech India, “As there is no focused player in this segment, even a small percentage of the market can translate into huge volumes.”

atanu@expresscomputeronline.com