Print.IT Reseller - issue 55

01732 759725 18 ACQUISITION ...continued capabilities in contractual printing services and solutions, an experienced leadership team and access to SMB and mid-market customers. “HP Inc. made a good decision in choosing Apogee given its experience in managed services and its specific ability to develop and support higher margin services,” Hendriks said. “Apogee has been growing in strength providing access to new skills, new customers and a greater geographical reach. In addition, it is very experienced in pre-sales, post-sales and servicing,” McNee added. “The Apogee acquisition extends HP’s print leadership by boldly leveraging the industry shift to contractual sales as we aggressively pursue the A3 office market,” said Enrique Lores, President, HP Imaging and Print. “We’re augmenting our go-to-market and enhancing our ability to deliver the services necessary to win in the profitable contractual market. This deal complements our broader channel strategy and HP remains committed to building our business through our best- in-class partner program.” “HP Inc. is not just buying an MPS provider,” Hendriks said. “Apogee has a very broad portfolio including production, wide-format (graphics and creative), signage, posters, wrapping and 3D as well as digital document services (on-site and off-site), digital and hybrid mail, professional services, software solutions and variable data printing. With adjacent services in mind, Apogee also offers desktop service such as disaster recovery. Although this announcement refers to managed print services, there is also potential for Apogee to support HP Inc. in these other areas,” she added. Commitment to the channel The deal is expected to close by the end of 2018, pending regulatory review and other customary closing conditions. Following the close, HP says that Apogee will operate as an independent subsidiary of HP, with a governing board comprised of HP and Apogee management. More than 85 per cent of HP’s business comes with or through the channel, and much of its future success is reliant on the health of its partnerships. In a communication sent to HP partners, the company said: “Given the market consolidation and changing customer landscape, this acquisition is an important step in our strategy to advance the opportunity in contractual office printing. “We do not take our partnership with you, nor the strength of our channel, for granted. While we have one of the strongest channel programs in the industry, we know we must earn your trust, respect and business every single day. The entire team and I remain committed to you and to the channel.” HP also assured its partners that Apogee will not receive preferential treatment or terms and that it will have access to the same programs and tools that its partner network has today. “HP Inc.’s existing channel partners will be counting on its promise that Apogee will not be given preferential treatment and that channel conflict will be avoided,” McNee commented, adding: “HP Inc. will need to manage this situation very closely to avoid damaging relationships with loyal partners.” Other vendor relationships According to Hendriks, this acquisition calls into question Apogee’s other vendor relationships. Apogee is currently counted as one of the main partners for Canon and Ricoh and a significant partner for Konica Minolta and Kyocera. IDC expects HP Inc. to swap out competitor offerings in favour of its own over time. “As office printed page volumes decline, vendors aim to transition customers from transactional to contractual engagements to secure three+ years of recurring revenues with the opportunity to provide print and document management solutions as SMBs particularly prepare to automate their document workflow,” she said. “The European SMB market represents a huge market opportunity for all printer/MFP vendors and consequently, many are investing heavily in channel education and training and support programs to enable the channel to develop services- and solutions-led engagements. Channel programs must consider that huge skills gaps are often identified among channel partners. Partners, like Apogee who already can demonstrate print services experience are extremely valuable,” she added. A twist on market consolidation “This is a twist on market consolidation,” said McNee. “Apogee was instrumental in channel consolidation particularly in the UK market and HP Inc. has now amplified this consolidation. Although the acquisitional activity within the channel seems to be currently focused more on the UK, IDC expects to see further channel consolidation as major channel players seek to grow and printer/MFP vendors look to fill their skills gaps with partnerships and further acquisitions.” www.hp.com www.idc.com www.apogeecorp.com HP says that Apogee will operate as an independent subsidiary of HP, with a governing board comprised of HP and Apogee management Sharon McNee, IDC analyst