Hewlett-Packard Hedges Bets In Digital vs. Paper Market

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Hewlett-Packard Hedges Bets In Digital vs. Paper Market

By Heather B. Hayes

Contributing Writer

Hewlett-Packard is not taking sides in the digital vs. paper wars. Instead, it's embracing both mediums by simultaneously bolstering its scanner and printer divisions with new products and strategic alliances.

This approach, explains Alan Lawrence, manager of strategic programs for Hewlett-Packard Federal, is designed to keep the company in firm control of both the on- and off-ramps of the information superhighway.

Thus, the company chooses to react not to what industry experts believe the workplace should be or will be in the future, but what it really is. For example, HP studies have shown that while workers want to digitize their existing paper files, they're not ready to give up paper altogether.

"Everyone likes to believe that offices are going paperless," he explained. "But the reality is that the amount of information in the office today is growing exponentially. So while the paper as a percentage of that is declining, the amount of information is growing so fast that paper use is actually increasing, not decreasing."

HP's newest products and upcoming future releases will all be tied into the fact that workers are eager to get on the information superhighway, but they're not quite ready to live there all the time. They still want to get off via the printer.

New products include the Mopier, a printer that acts like a copier; the LaserJet 5N printer, the first low-cost, network-optimized printer for work groups; and the just-released Network ScanJet 5 Scanner.

In addition, HP recently signed an agreement with Caere Corp., the leading player in the optical character recognition, or OCR, products industry. OCR is critical from a productivity standpoint since it allows scanned text and images to be incorporated directly into word processing and other applications.

"It's a long-term relationship," explained Eric Blakemore, product marketing manager for HP's ScanJet Scanners. "We're not just throwing together pieces of software with our hardware introductions, but providing more of a consistent solution that we're building upon by working with a manufacturer that has expertise in a needed area. So we're providing something that's better for the customer."

HP finished 1996 with revenues of $38.4 billion for a modest earnings increase of 6 percent. Company officials hope that the company's new strategy, undertaken late last year, will help improve not just order numbers, which were up 19 percent last year, but keep orders coming in at a consistently higher rate.

All of HP's moves, Lawrence noted, are in response to office worker behavior patterns. For example, Internet and desktop computing have created a new work style that HP calls "distributed print." The first thing computer users often do when they find useful information on, for example, the Internet or an e-mail system is to print it out, make several copies and send it to their colleagues via interoffice mail, Lawrence explained.

As a result, the company came up with the Mopier, a printer that works like a copier in that it can produce multiple, two-sided, collated and stapled documents. HP officials hope this ability to distribute and then print documents will spur organizations to abandon centralized printers and scanners in favor of numerous local ones. "With this type of system, the person no longer has to run around hoping that the printer is not in use and the copier is not broken," Lawrence said. "It saves a lot of time and makes the office worker that much more productive."

The move toward Web-based marketing and sharing information across the Internet is driving HP's scanning side, noted Blakemore. ScanJet products now carry a number of software programs including Corel-Web.Designer, which allows a user to incorporate images into Web pages; a version of Visioneer PaperPort enhanced for HP products to let users create desktop folders and better manage scanned text and images; and Adobe Photoshop.

The partnership with Caere is designed to give users at all levels a complete, off-the-shelf scanning solution, Blakemore said. Either Caere OmniPage Lite or OmniPage Limited Edition will be integrated with HP flatbed and sheet-feed scanners and the all-in-one OfficeJet. The OCR software can also be used with the software on HP products.

For Caere, based in Los Gatos, Calif., the relationship with HP offers the company a major chance to increase the number of users who utilize OmniPage, but, says Chad Kinzelberg, the company's vice president of marketing, "it also allows us to reach our target market with information about our other scanning products."

"I think the difference here is that we're not focused on helping people create digital information," said Lawrence. "That's easy if you've got a computer. The harder thing is to deal with all that paper that's sitting in your office. And then when users do want to print out what's on the desktop, we want to find easy and productive ways to do that [so it] fits in with their work style."


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