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HP Trumpets Print Management Business

Hewlett-Packard Wednesday proclaimed a new revenue stream in its traditional bread and butter digital imaging and printing business.

The Palo Alto, Calif.-based computer and printer maker said its fledgling Total Print Management division -- an element of its Adaptive Enterprise strategy -- has garnered some more than 625 new customers spending upwards of $500 million in service contracts since it launched in March 2003.

Company execs noted that HP's latest marquee customer wins include the likes of Bayer, Bechtel SAIC Company LLC and Duke University.

"We've found one-third of all business processes involve printing," HP Services Executive Vice President Ann Livermore said during a conference call to reporters. "We think as more and more content moves from static to digital and mobile and virtual, HP is in a unique space to capitalize on this trend."

From a profitability standpoint Livermore suggested that the company's imaging and printing services is comparable to its desktop services business, which is 21 percent slice of the whole services pie.

"It's a margin that we like," she said. "This is a faster growth segment than our other managed services divisions."

Analysts estimate that the market for imaging and printing business services will grow to more than $17.5 billion in 2006.

While HP acknowledges its 70 percent product market share may have played a major part in convincing customers, the company is enthusiastic, but guarded on the notion of taking over copy center contracts of competitors like IKON or Xerox .

"We can do that as well, it depends on the contracts said HP Imaging executive vice president Vyomesh Joshi. "As we deploy customers' imaging and printing fleets, there are a number of payment and support options. If you save a few costs per copy, however, that is not as effective as saving a couple of hours in managing the documents. Remember we have computing competitors as well as traditional copier companies and other printing competitiors in this space as well."

HP's Print Management portfolio uses an assortment of HP-patented assessment tools and real-time computer-based calculations, something that the company says the competition just doesn't have.

Joshi also said HP has a leg up in that the printers and multi-function devices the company has shipped in the last two years contain embedded firmware and software that allow for intelligent Internet communication with PCs and servers. The company said some of its printers also let managers track usage through Web-based processes.

The Print Management push is vastly different from HP's $300 million consumer marketing push. The campaign features the all-encompassing tagline: "(customer) +hp = everything is possible." With this latest effort, HP is concentrating on its digital photography lineup, which includes cameras, printers, PCs, ink and paper.