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 user 2007-07-09 at 10:58:00 am Views: 74
  • #18302

    IBM / Ricoh joint venture.
    has been a dangerous competitor simply because they are so smart. They
    have taken huge leaps to relieve themselves of divisions and
    technologies that are not in its core vision of strengths. Their
    intense focus over the past dozen years has created some interesting
    and important changes with lasting effects on the broader IT industry.

    printer division, located in Lexington KY was one of the casualties,
    when IBM “hatched” Lexmark in the early 1990’s. [They have since sold
    off other manufacturing and engineering divisions such as Hard Drives
    (Hitachi), Communications (Cisco), PC’s (Lenovo), etc.] One would have
    assumed that IBM’s next generation of printers would be an IBM branded
    machine made by Lexmark. (Made an ass of me) So, just as we all were
    getting our arms around the idea of this new company, “Lexmark”, we
    were surprised by IBM’s next move. They chose, oddly enough, to use
    Fuji-Xerox as their manufacturer for their own next-generation
    IBM-branded printers. It seemed strange that IBM would spin off its
    venerable engineering and manufacturing infrastructure, only to go with
    another vendor. (Did IBM and Lexmark have a tiff and decide to not see
    each other anymore? Or did IBM walk because they couldn’t get a “deal”
    from their offspring? ).

    It was not without bumps, but the
    dealer community embraced IBM’s moves while continuing to support
    Lexmark’s products in competition. There were new product families
    which were not evolutions of intellectual capital and improvement, but
    were instead all different from IBM’s continuity developed in their
    Lexington plant. We dealt with new documentation, technical
    publications, error resolution, design and manufacturing execution,
    etc. It was rough, but I enjoyed the challenge of the broader
    offerings. We settled in for the long-run, and then…

    next move? In the late 1990’s IBM unveiled its newest generation of
    printers. And they were back to their Lexington roots. IBM, like many
    others (Unisys, Decision Data, Genicom, etc.) were buying their
    printers from Lexmark, but putting their own name on them. IBM and the
    other manufacturers loved the idea that Lexmark’s technology made the
    on-going supplies revenue proprietary. That is, you couldn’t use a
    Lexmark toner in an IBM machine, even though both were the same engine.
    IBM could sell printers, guarantee their supplies revenue, and not need
    production, engineering, parts, or inventory. Good deal!

    Now it
    seems to have come around again, but this time, IBM is actually exiting
    the printer market, at least directly. IBM has sold off the entire
    printer division, forming this Ricoh/IBM joint venture called Infoprint
    Solutions Company. I see the overall move as an excellent decision;
    combining IBM’s vast technical support and maintenance assets, with
    Ricoh’s engineering, manufacturing and printer-focused future. Clearly
    there will be a learning curve but I expect it will be rather benign.

    older Fuji-Xerox gear is still chugging along out there even seven
    years later, so there is no reason to doubt that IBM’s newer
    Lexmark-based printers will be running for a long time to come. So,
    users will have to choose a path based on the questions: “Should we
    continue with the technology pedigree of printer engines designed and
    manufactured by Lexmark”, or “Should we move into the expanded Ricoh

    Clearly, Ricoh has a strong incentive to turn over the
    installed base of older equipment into their robust product line. Ricoh
    has a very long and hard-earned history of success in the world market.
    The relationship between IBM and Ricoh goes back quite a long way.
    Ricoh has had a strong market penetration in the copier and fax markets
    for many years, but had little “in” with the IT community. IBM employed
    Ricoh’s engines and technology in their mid-range laser printers, and
    probably negotiated to keep Ricoh from competing in the lower end
    market. (Why is Canon Corporation not selling hard into the laser
    printer market? Because that’s who makes HP’s lasers). But now Ricoh is
    in control, and I would be amazed (no assumptions this time) if they
    didn’t use their own technology and engines for the lower end of the
    market in lieu of the Lexmark stuff today.

    There is a strong
    case to be made for uniformity in infrastructure including printers.
    The installed base can be easily migrated to newer versions made and
    supported by Lexmark. As I see it, there is more to gain in keeping
    consistent with the existing installed base than from a lateral move
    over to Ricoh’s gear, at least marginally. Ricoh’s products have
    typically sold at higher price points because their sales model favors
    lower supplies costs, which is certainly in the interests of long-term
    users. But a flick of the pen and Lexmark’s toner supplies could easily
    undercut that advantage.

    So what to do now? Since Ricoh hasn’t
    even announced any new products, keep buying Lexmark or IBM printers.
    Once Ricoh’s products become available, wait it out a bit and see how
    it performs. Not until problems arise can one adequately determine the
    responsiveness and supportability of the new lines. I would think that
    the users really don’t care all that much, as long as their gear is

    My philosophy is as it has always been: properly
    maintained, the installed base should last for many years, and
    uniformity over the long run is the least expensive and problematic
    paradigm. Either way things pan out, we’ll be there to support you.

    you heard it here first. Intel has a major problem. They cannot make
    their processors smaller (faster), so they are instead making them
    multicore. That’s wonderful, but show me the plethora of software
    applications, present or past, that can truly take advantage of
    multithreading. The dual and quad core processors are still clocking at
    less than 3Ghz. Watch out for the PowerPC. Interesting, don’t you
    think, that Apple moved their Macintosh gear to Intel (away from
    PowerPC) just as we reached this point? Also note, if the older
    Macintosh gear ran natively on the last generation of PowerPC, then we
    may consider that it will also run on the latest PowerPC. The latest
    PowerPC will run iSeries frames. Do IBM and Apple have a venture to
    replace PC’s with Mac’s for the enterprise? Let’s see: the Mac OS is a
    UNIX variant. Linux is like UNIX. Linux runs on iSeries (and zSeries).
    Macintosh on IBM?

    David T. Mendelson
    Argecy Computer Corporation
    27280 Haggerty Road C21
    Farmington Hills, MI 48331
    248-324-1800 x122
    248-324-1900 fax