From BLI
June 18, 2008 - At its annual dealer meeting held last month in Orlando, Sharp announced a wide range of upcoming hardware products along with the next-generation of its OSA development platform, and demonstrated numerous software solutions from its development partners.
The “Next Frontier” theme of this year’s meeting refers to the “next frontier of opportunity” for dealers, including the market for letter/legal multifunction products, commonly referred to as A4 products. Along with the many ledger-size (A3) models announced at the meeting, Sharp announced 18 A4 MFPs and printers—referred to by the company as the “Frontier” series—that will be introduced over a six-month period beginning in the third quarter.
This product category has become increasingly important as more output volume shifts from copies to prints, and the responsibility for buying output devices increasingly shifts from the purchasing department to the IT department. While printer vendors including HP, Lexmark and Samsung have offered these products for a few years now, copier vendors have thus far reserved letter/legal products for the lower-speed segments, continuing to offer ledger-size-capable products for the mainstream office. The few copier vendors (for example, Xerox and Toshiba) that offer A4 MFPs in the 45-ppm range use engines sourced from OEMs.
Sharp, in contrast, will be the first of the copier vendors to offer its own products in this class when the first ones—two color MFPs—arrive on the market in the third quarter, provided no other company’s products arrive on the market in the intervening months. Contrasting its entry into this market with the “bottom up” approach other vendors have taken, Sharp says its A4 products will offer “A3 performance in an A4 footprint.” Indeed, the units employ the same technology as in Sharp’s MX series models, including the same MX controller, print drivers, scan functionality and customization capabilities via OSA.
In light of the growing interest in this product category and the growing managed print services business, Sharp’s upcoming products will add an important new dimension, and a competitive advantage, to a product line it has been steadily building and improving over the past five years and which in December was named by BLI as “Line of the Year” for 2007.
Subdued Reaction
So it was surprising when, in contrast to other meetings when the new products are typically greeted with much enthusiasm from the dealer audience, the reaction to Sharp’s product announcements during the general session was markedly subdued. Even when Sharp President Ed McLaughlin attempted to elicit a response by asking, “What do you think?” the audience was quiet.
One theory is that at past meetings when Sharp unveiled its Segment 6 production models, or before that its MX series of color models and OSA, Sharp was behind the curve and dealers were clamoring for Sharp to fill these holes in its product line. For the first time, Sharp is ahead of the curve, and according to one dealer we spoke to, many dealers may not know that they need A4 MFPs and printers and don’t understand their benefits. “But they do need them if they want to stay in business,” he said.
Another theory is that the new products are months from arriving on the market—so while they may be great, they’re not here yet. Finally, understandably, dealers are uncertain about how these new lower-priced models, with their lower margins, will affect their profitability. The requisite seminars on managed print services and expanding volume were held—and well-attended—during the show, but Sharp executives acknowledged that between now and when the products arrive on the market, the company needs to, and intends to, get the go-to-market strategy message out to its dealers. Because other vendors no doubt have products in this class of their own under development, it was a calculated risk for Sharp to make its announcements months before the products debut. Consequently, one Sharp executive told us, the company didn’t want to further tip its hand by providing details on the go-to-market strategy.
Why A4?
Gary Bailer, Sharp associate director of product management, told the audience that the new A4 product line, with its lower pricing and different margins from the normal ledger-A3 products, represents a huge step and an enormous opportunity for Sharp. Explaining the opportunity, he noted that Sharp’s research shows that only 14 percent of the pages produced in offices are produced on ledger-size paper. (Other studies indicate the percentage is even smaller). That, of course, means that 86 percent of pages are produced on legal- and letter-size paper. Further, for every one ledger-size device in an organization, there are between eight to 10 letter-size devices. The average number of pages produced per month on letter-size Segment 3 and 4 output devices is 4,000 to 8,000 pages for color models and 10,000 pages for monochrome models, according to Bailer. “Do the math,” he said. “The opportunity is huge,” if Sharp can capture a share of the majority of pages that are produced on letter- and legal-size paper.
It is because of numbers like these that providing managed print services (whereby a dealer or reseller contracts with a customer to provide the service and supplies for its entire fleet of MFPs and printers) has become such a trend. Sharp’s upcoming MFPs and printers that produce letter- and legal-size output will help its dealers to provide this type of service.
Another important component needed in the product line for a successful managed print services business is remote device management. That capability was also announced at the show, with key new enhancements for Sharp’s Printer Administration Utility 5 and OSA integration with MWAi’s remote device and service management software.
Upcoming New Products
Slated for availability in the third quarter, the first of the A4 products to arrive on the market will be 31-ppm and 40-ppm color MFPs. Like all of Sharp’s upcoming products, they will support OSA 3 and feature a new look, with rounded edges and a textured, light gray exterior with black trim. Also new is a standard mini-keyboard that pulls out from the front of the unit to allow for easy entry of destinations and metadata. Network printing—PCL 5c/6 and PostScript—is standard, as are scanning, 512 KB of memory and an 80-GB hard drive. Resolution is 600 x 600 dpi in both four-bit and one-bit modes, and there is also a 1200-x-1200-dpi resolution mode. A USB port, located on the right side toward the rear of Sharp’s current MX products, is more conveniently situated on the front of these new models. The new units also support optional Gigabit Ethernet, as well as XPS printing and scanning as an option.
DX and MX Versions And Printer-Only Models
Each of the models will be available in MX and DX versions. Designed for sale exclusively through the dealer channel and through Sharp direct sales and branches, the MX versions will feature a newly designed 8.5-inch high-resolution WVGA color touch-screen LCD panel that enables users to view thumbnail images of documents with impressive clarity. The DX models, which will be available through open distribution, will feature a 4.3-inch non-touch-screen LCD display. The MX models have a traditional dealer-oriented warranty, while the DX models will come with a one-year on-site warranty.
All of the units can be either user- or dealer-installed and employ user-replaceable components that, according to Bailer, have a life that’s six times longer than those of competitive models. Supplies include toner cartridges that each yield 10,000 impressions, black drum and developer with a life of 60,000 impressions, and color drums and developer with a life of 30,000 impressions each.
Bailer pointed out that Sharp has taken a “best-of-breed” approach with supplies and service. He explained that whereas many printers use a monocomponent, all-in-one cartridge that increases total cost of ownership, and many copiers use service-replaceable developer and drums, the Frontier models use separate tri-component supplies that can be quickly replaced by a service technician or the end user. He added, “As hardware margins compress, these components, combined with remote access to the device [a capability also announced at the show] can reduce dealers’ service costs.” All consumables are user-replaceable, including the fuser, transfer belt, transfer roller and document feed rollers. Bailer estimated that supplies cost per page would fall between that of Sharp’s MX-2700 copier MFP and HP’s 4730 Color MFP. Though the supplies and yields are the same for the DX and MX models, they are not interchangeable.
Both models feature a standard 500-sheet paper drawer and a 100-sheet bypass, but that capacity can be optionally increased to 2,100 sheets. A user-installable inner finisher that staples up to 30 sheets in a single position is available (it takes the place of the exit tray), as is a 50-sheet RADF.
Printer-only versions of the color MFPs will arrive on the market in the first quarter of 2009. Two monochrome MFPs, with speeds of 40-ppm and 50-ppm and support for color scanning, will follow in the second quarter of 2009. They will also be available in printer-only versions in the second quarter of 2009.
Since a full product line is required for managed print services, two additional monochrome printers sourced from another vendor—one 25 ppm and one 35 ppm—will round out the A4 line.
A3 Product Line Updated
While the A4 products were the highlight of the show, Sharp also announced enhanced versions of many of its ledger-capable MFPs, some of which will arrive on the market before the A4 models. Like the upcoming A4 products, the new A3 products, with the exception of the upcoming Segment 1 product, will feature the new design, the high-resolution touch-screen display, pull-out mini keyboard and support for OSA 3, the latest iteration of the unit’s development platform for software solutions.
The first of the new ledger-size products to arrive on the market will be the 26-ppm MX-2600 and 31-ppm MX-3100, which are refreshes of the MX-2300 and MX-2700 they will replace. These models are based on a faster, 800-MHz processor for increased speed and processing power.
The New OSA 3 Frontier
Slated for availability in the summer, OSA 3 takes advantage of the full Web browser user interface. OSA 2 relied on “Web forms,” which are essentially a limited number of templates developers could use to create the list buttons for log-in screens and entering of metadata. Vince Jannelli, Sharp associate director of applications and partners, explained that Web forms make it very easy for developers to quickly create links to their software from the Sharp control panel, and because of OSA 3’s backward compatibility, developers will still have that ease of development.
OSA 3, however, with its Web browser and Java, goes beyond that to allow for more free-form development, which will allow for more flexible functionality such as radio buttons, checkboxes, the ability to refresh a portion of the screen and Flash support for display of full-motion videos such as for MySharp. OSA 3 also features Open USB capability, allowing developers to provide a broader range of access control—for example, the ability for users to log in via a swipe card and authenticate via a Chip/Smart Card, all without having to embed specific device drivers on the MFP. At the product fair, one Sharp MFP was configured with two different types of card readers and a biometric access control device.
As it was last year, OSA was one of the main focuses of the meeting. Three Sharp customers—the Biltmore Hotel, Plumbers Supply Corp. and the Indianapolis Symphony Orchestra—spoke with McLaughlin in informal Q and A fashion during the general session about how Sharp MFPs in conjunction with OSA solutions had helped them run their businesses more efficiently. In addition, 35 of the 100 developers currently in Sharp’s Partner Program demonstrated their solutions at the product fair. The company also announced that it had established the Sharp OSA Authorized Dealer Program, whereby dealers who meet certain standards of resources dedicated to the sales and support of the Sharp OSA business model and commit to bringing a select number of OSA software applications in-house gain access to enhanced support and a library of single-function applets targeted to legal, medical, finance and education vertical markets. The applets will be developed by the Sharp Business Systems Integration Group and Sharp will create products from those that are found to be successful.
Ledger-Size Color Models
Slated to arrive on the market in September are Sharp’s next-generation Segment 4 color models: MX-4000 and MX-4101 (with speeds of 41 ppm in color and black; the MX-4000 will be equipped with an RADF; the MX-4101, will be configured with a duplexing single-pass feeder). These models replace the current MX-3501 and MX-4501. They will be followed in November by the MX-5001, with a speed of 50 ppm in color and black. In addition to their faster color speeds, improvements in these models over the predecessors are stapling of up to 50 sheets (versus 35) for the saddle-stitch finisher and improved paper handling, including the ability to feed up to 110-lb. index through the drawers, even for duplexing, and up to 140-lb. index through the bypass. These models offer a 50-ipm scan speed, 60-second warm-up time and 80-GB hard drive, as well as 1,000 user codes.
Next-Generation Monochrome Models
Arriving on the market in the second quarter of 2009 will be the successors to the 35-ppm MX-M350 and 45-ppm MX-M450, which will be joined by a 50-ppm model. These units will also feature all the new design elements and the new high-resolution LCD panel, while using the chassis, finisher and LCT of the MX-4101 and MX-5001.
In late 2009, Sharp will introduce refreshed versions of its AR-M257 and AR-M317 models. It will also introduce a next-generation ledger-size Segment 1 model that will coexist with the AR-M162 and AR-M207. This model will offer improved duplex paper handling thanks to a document feeder improvement that minimizes misfeeding. Unlike Sharp’s current models in this range, the new model—the 20-ppm AR-5520, which will also be available in an AR-5520D configuration—uses Micro-Fine toner, which according to Sharp, allows for better image quality stability from page to page.
New options for Sharp’s Hercules series of production models (which includes the MX-M1100, MX-M950 and MX-M850) were among the new offerings on display at the product fair: an MX-PEX3 Fiery controller that was announced just prior to the show and the Plockmatic MX-BMX1 booklet-maker finisher, which produces up to 120-page booklets and will be available by the end of the year.
Remote Capabilities
All of Sharp’s new products now offer a remote operation panel, a separate utility that comes standard and enables remote viewing and remote control of the panel from a PC on the network. In addition, the latest version of Sharp’s Printer Administration Utility, PAU 5, adds remote capabilities that allow an IT administrator to remotely access the machine’s service log or remotely clone settings from one MFP to other devices. These capabilities also enable dealers outside the local network, provided the firewall access has been granted, to perform firmware upgrades remotely and access the service log for more proactive service for Sharp MFPs. This is an important capability for managed print services because it can save dealers money by preventing unnecessary and costly service calls. One of the OSA 3 applications demonstrated at the show was Sharp Intelligent Device Management integration with MWAi’s remote device monitoring and service automation software, which would enable dealers to see equipment across all their customer locations, view everything on their network, log into the network and access the Web pages of individual products, receive up-to-the-minute alerts of problems and automatically collect meter readings at specified intervals and integrate the data into their ERP system.
Sharp Displays On Display
Also on display at the product fair were several professional display products. Previously part of Sharp’s consumer electronics divisions, the LCD flat panel displays, projectors and touch screens, which are used in conference rooms and for signage and point-of-sale terminals, have been part of Sharp Imaging and Information Company of America for the past year. While most of these products are sold through Sharp’s approximately 250 professional A/V dealers, 30 document imaging equipment dealers are actively selling this equipment now, but company executives expect that number to grow. Government and education are top markets for this type of equipment and, according to McLaughlin, these dealers have found it gets their foot in the door of large accounts, which likely also have the need for document imaging products.
Certifications Touted
An area of the product fair was dedicated to spotlighting the various certifications Sharp has earned. In addition to Common Criteria certification, Sharp’s products will also support IEEE P2600, a new industry standard for the security features of output devices for use in corporate environments that will be publicly announced in the late summer timeframe. Along with other MFP vendors, Sharp was on the committee participating in the development of the standard, which covers user identification and authentication, overwriting of data, protecting data in transit, preventing modification of data, administrator identification and authentication, audit trail monitoring, protections against malicious attacks on the network (such as with port filtering and IP addressing filtering), and preventing access to the network from a fax line. An addendum covering Common Criteria certification is under development.
In addition to the security certifications that Sharp is known for, Sharp spotlighted its Cerner and McKesson certifications, which are very important to buyers in the medical and healthcare markets. All monochrome and color Sharp products ranging in speed from 23 to 70 ppm have Cerner certification. Sharp’s AR series products have McKesson certification, while certification is in progress for the MX series products. Sharp also provides support across its full line for printing in HP Output Server (Dazel), as well as SAP environments.
A Brief State of the Company
While most of the focus at this year’s meeting was on the new products and on the new expanded capabilities of OSA 3, Sharp President Ed McLaughlin reported the following regarding the state of the business:
Revenue for the just-ended fiscal year 2007 was up 8 percent over the previous year—in spite of the fact that last year was the first in more than a decade that Sharp placed fewer units than it did the year before.
With the “strongest office product line on the market,” Sharp intends to become either the top vendor or one of the top two vendors in the market—in terms of revenue and market share—five years from now.
While monochrome devices still represent the biggest part of the business, color placements continued to grow last year, representing a percentage of total revenue in the mid- to high 30s.
Sales of the company’s retail AL products are declining and the fax business dropped precipitously, but there has been a major shift up-market, which is why the company is growing nevertheless.
Sharp has sold well over 1,000 of its Segment 6 Hercules products.
The company’s direct sales branches are doing very well and “without the turmoil and fuss” between channels that some other companies have encountered. The direct sales branches are a significant part of the organization, generating a $200 million run rate and 15 percent of the company’s revenue in just over a year.
This article was originally post at Buyer's Laboratory.
