Dell to focus on laser, multi-function printers

NEW YORK: Dell Inc. on Wednesday said it plans to shift its printer focus to laser and multifunction devices, and away from stand-alone inkjet models, in an effort to score more profits from its printer segment.

Dell, the world's biggest personal computer maker, said it has sold some 10 million units after about 2-1/2 years in the printer market, which is dominated by Hewlett-Packard Co. and includes rivals such as Seiko Epson, Canon Inc., Xerox, and Lexmark.

"After the 10 million mark, we are shifting our focus in key categories...to high value products," Ro Parra, Senior Vice President for the Americas at Dell, said on a call with analysts. "The lifetime operating income in those products is very attractive."

The printer market is driven by users' constant thirst for replacement ink and toner, which deliver far more profits than printer hardware that is often sold at break-even or a loss. Parra said that toner sales for laser printers, popular with businesses, are selling at three times the pace of ink sales.

Dell, which does not manufacture printers and has technology partnerships with Lexmark International, Xerox and Samsung, said its target for printer sales this year is about 7-8 million units.

To be sure, Dell's printer business is still dwarfed by entrenched players such as Hewlett-Packard Co. But the growth reaffirms the company's ability to jump into a new market, quickly establish a presence and grab market share.

Ironically, Dell's optimism comes on the heels of news that Japanese electronics maker Seiko Epson Corp. on Wednesday slashed its operating profit forecast by 46 percent for this business year, due in part to a slide in sales of ink jet printers and ink.

Dell said that while its business model does not compare directly to Seiko Epson, its Web-driven system helps users buy replacement ink and toner faster and more efficiently than other company who rely on retailers to sell supplies.

Dell on Tuesday introduced two new printers, the Photo All-In-One Printer 924 and 944, which have improved photo-printing capabilities, designs and wireless options, the company said. Multifunction, or All-in-One, models typically can print, copy, scan and fax images and documents.