Revolutionizing Printing in the Modern Workplace – The Six Five On The Road

Patrick Moorhead: The Six Five is on the road in Las Vegas, and we’re at HP Amplify Partner Conference 2024. It’s been a great event so far. The company rolled out all of its strategies overall. There was a lot of talk about AI. There was a lot of talk about end user experience as a service. And there was discussion, of course, of printers which, by the way, are about a third of their revenue but about 75% of the operating profit dollar, so printing is very much a core part of the office and personal experience, but it’s also a very core part of HP’s business.

Daniel Newman: Yeah, Pat. It’s been a fast-paced series of conversations. By the way, cast of stars.

Patrick Moorhead: Yes.

Daniel Newman: We were in that general session, CEOs of Microsoft, Intel, Insight Partners, you had Qualcomm. Just partner after partner, big names, big stars, big focus. I think you hit the points. It’s about hybrid work, it’s about AI and this topic’s not going anywhere anytime soon.

Patrick Moorhead: That’s exactly right. Let’s bring out our guest, Vivian, she runs Office Printing. Great to see you.

Vivian Chow: Nice to meet you.

Patrick Moorhead: Yeah. There’s a lot of focus on the office today, even though you do of course have a personal business. I really do like the focus. These news technologies are obviously going to probably radically change productivity in the office space, but also in the consumer. But again, we’re not here to talk about consumer, we’re here to talk about commercial printing.

Daniel Newman: You have the Office product portfolio.

Vivian Chow: That’s right.

Daniel Newman: That’s a big role. You heard Pat rambling off those numbers, you maybe smiled a little bit, especially when that op income’s up. Printing may be one of those things that doesn’t always get the front line, everyone’s talking about PCs and AI, but you know what, it’s essential. I know they say that about the PC, but so is that. As you’re running this part of the business, I guess it seems like a really big opportunity, big moment for you to show up as a trusted partner. How are you thinking about using this moment, this inflection, this continued fight of the pendulum for hybrid work to build trust with your customers?

Vivian Chow: Yeah. Thanks for that question. I think hybrid workplace is about two main themes for us. One is about distributed workforces.

Daniel Newman: Sure.

Vivian Chow: We think about working in home offices, more centralized corporate offices, and that distributed workforce is going to drive varying needs in printing. The second theme I think that’s very strong in hybrid work is about collaboration. When you’re in that shared work space, think about small work teams. They’re doing workshops.

Daniel Newman: Right.

Vivian Chow: They’re jointly collaborating to learn and develop. The theme we see in centralized offices is about collaboration. HP can be a very trusted partner because of that breadth of our portfolio. You’ve seen a lot of it. That varies from our computing devices, our collaboration tools, to our printing and scanning devices. Now if I go back more specifically into the printers in the office and hybrid, I think that theme of breadth of portfolio comes in very strong. As we think about a hybrid workforce, there’s going to be shared offices, there’s going to be dedicated offices, they’ll be remote. As you think about the printing needs, they’ll be very diverse, they always have been. Think about a shipping department versus a marketing department.

Daniel Newman: Sure.

Vivian Chow: Think about highly regulated printing needs in the financial sector or healthcare sector. The breadth of our portfolio, you talked about the home and the office.

Daniel Newman: Yes.

Vivian Chow: It’s super broad. A4 letter legal sized desktop printers, all the way up to the most sophisticated copiers, highly productive, floor standing 11 by 17 capabilities. We have color and mono devices, dedicated devices, printers and scanners. We have multi-function devices. We’re super proud that in 2023, we were named A3 BLI Line of the Year.

Daniel Newman: That’s great.

Vivian Chow: Just recently in 2024, we got the A4 BLI Line of the Year. Customers and partners can trust us to be able to deliver to all those varying needs in a hybrid workplace. The second theme I think that’s really critical in printing for hybrid is security.

Daniel Newman: Sure.

Vivian Chow: That’s always been a theme. I think it’s even more so now. I think we’re all acutely aware of so many more cyber attacks. They’re more frequent, they’re more sophisticated. You know, they’re only going to continue with AI technology. As cyber attackers get equipped with AI technology, they’re going to keep coming at us pretty hard. What’s great about our portfolio at HP is we’ve always been grounded and focused on security and the secure printing devices we have. It comes based on a foundation of what we call zero trust architecture. Zero trust means we validate and verify the code running on our devices. We validate and verify users who want to access our device. We validate and verify the data coming to our devices. It’s with this that we can be the trusted partner to give that peace of mind not only to the end users, but also to the partners who are delivering our devices to those customers.

Patrick Moorhead: It’s a very comprehensive answer, I appreciate that. It’s interesting, doing these interviews as analysts, we don’t want to say we actually learn something but I didn’t know that you adopted zero trust architecture. That’s typically the land of the data center, where everything has a special key. But now that I think about it, now that particularly on the edge and the risk-

Vivian Chow: Absolutely.

Patrick Moorhead: One network connected printer gone awry is a potential exploit to get into somebody’s data, to be able to do nefarious ways. By the way, congratulations on the award-

Vivian Chow: Thank you.

Patrick Moorhead: As well. I’ve been working for over 30 years, and I’ve worked in Fortune 500 businesses, very large enterprises. My business, when I started it, was a micro business. I’m proud to say it’s a small business now.

Vivian Chow: Oh.

Patrick Moorhead: Not a medium business. It’s funny, sometimes the industry just papers over the distinction between, let’s say, micro, small business, and medium business. Can you talk a little bit about maybe the differing needs out there, across those? Then, I think also as a follow-up, I’ll just get the follow-up out now, how is HP differentiated in those spaces?

Vivian Chow: Great question. I do think, to your point, and again you’re probably very aware of how often times the smaller businesses are somewhat overlooked. Not quite consumer, not quite enterprise. At HP, we see that those SMBs, they are often the most strapped for resources. Whether that could be to simply time.

Patrick Moorhead: Right.

Vivian Chow: It could be investment, it could be staffing. But what we hear very loud and clear in the smaller businesses, they want to be efficient. They want to digitize. They want to be more sustainable. The challenge is finding the time and the expertise to go investigate the many solutions that are out there in the marketplace.

Patrick Moorhead: Yeah.

Vivian Chow: This is where I see HP and our partners being able to come in. We have recently announced two new services directed specifically at smaller business. Whether that’s our HP All In plan. It’s an offering to micro businesses who can get their device, their supplies, their media, their support, even their device upgrade all in a low monthly fee. So that convenience that an SMB can enjoy without the elaborate contracts that may come sometimes with a service.

Patrick Moorhead: Right.

Vivian Chow: Similarly, we’ve announced our MPS subscription service. It’s flexible and it’s simple. These are things that allow an SMB to do those things they crave, that they seek to be more efficient, to focus on their business, a little bit less on their IT.

Patrick Moorhead: Yeah.

Vivian Chow: We recognize there are SMBs who may not yet be ready to upgrade to those services. We’re always developing solutions. We have a suite of solutions that are directed toward the easy management of our devices. That means things like security out of the box. You don’t have to be an expert in security. You may be very familiar with it, but there others who are not.

Patrick Moorhead: Sure.

Vivian Chow: They want that peace of mind, our devices come secure out of the box. Straightforward setup. They don’t have time to set up multiple devices, or configuration. Those are ways that we see coming up with the right solutions, services to meet those varying needs of businesses, varying from micro businesses all the way up to those small and medium businesses, that HP’s coming across as a trusted partner.

Patrick Moorhead: That’s good. By the way, a sidebar here, we like to talk about as a service to be this big thing that we’re fixing to do as an industry. Printers are very much in the as a service, whether it’s ink as a service, or full off printing as a service. HP actually led in those areas, and I think in a way, is a framework for device as a service.

Vivian Chow: Absolutely.

Daniel Newman: Yeah.

Vivian Chow: Absolutely.

Daniel Newman: What year was the split? The HP split?

Patrick Moorhead: It was so long ago.

Daniel Newman: ’15, ’16?

Patrick Moorhead: At last.

Daniel Newman: It was in that era.

Patrick Moorhead: Yeah, somewhere in that.

Daniel Newman: I know I remember I spoke at that event, and that was right when print as a service was being launched.

Vivian Chow: Yeah.

Daniel Newman: I remember that period of time, just thinking about how important it was going to be for a company like HP to be able to come up with these new recurring revenue streams. It was powerful, and sometimes I think the market doesn’t fully appreciate that these things have not only been there, but they were maturing. Another thing that I think HP appreciates is its channels.

Vivian Chow: Yes.

Daniel Newman: And understands, obviously, this event is a partner conference.

Vivian Chow: Very much so.

Daniel Newman: You need engaged partners that can clearly understand the vision, how they’re going to benefit off of all the trends, forces. When it comes to hybrid work, when it comes to AI, when it comes to print, talk a little bit about how you engage and keep your channel partners feeling like the opportunity is substantial? And what are those opportunities that you’re really seeing for them?

Vivian Chow: I think we talked about a couple of those themes already.

Daniel Newman: Yeah.

Vivian Chow: There’s great opportunity with SMBs, upgrading them to a service. We have partners who are able to do that today, with offerings jointly from HP. Giving them that convenience. Moving from that trusted IT advisor to that trusted IT service partner. There’s a tremendous opportunity there with SMBs. Another big area is with that hybrid work. We hear a lot about enterprises re-laying out offices for hybrid workforces. Very different than the traditional enterprise offices we used to be. We see that our partners have an opportunity to go in and capitalize on that re-layout, deliver that consistent fleet. Why is a consistent fleet important? It gives a consistent user experience so the employee base is very effective and productive. It also enables consistent management of a device. Again, back to that security theme.
Daniel Newman: Right.

Vivian Chow: When you have a consistent management workflow of security, you can be much more confident that you are secure. I think a couple other areas are around digitization and document workflow. Again, both enterprises and SMBs very much care about that. As our partners understand that workflow need, they have an opportunity to deliver solutions, software, services that take them beyond device and supply up to workflow management.

Daniel Newman: Right.

Vivian Chow: That’s another offering. Then if I go back to the theme of breadth of HP portfolio, we have computing devices. We have collaboration devices. Why not move up to IT services beyond printing services? I think those are some ways that our partners continue to grow and partner with HP, expand and again, accelerate their own businesses.

Patrick Moorhead: Yeah, that’s good. It’s been a great conversation. It wouldn’t be a comprehensive conversation in 2024 without talking about AI. The two sub -themes, subplots of the show is hybrid work and how AI makes businesses more productive, more effective, and in some cases, more creative.

Vivian Chow: Yeah.

Patrick Moorhead: How does printing intersect with AI?

Vivian Chow: Great question, and again very consistent with the big theme of the show. I don’t know if you’re aware that we already have AI powering some of our capabilities and are already delivering benefits to our customers and to our partners. The first one is in the space of serviceability. We have partners who have tremendously reduced their service costs through a service we called Smart Device Services, that’s powered by AI. It enables our partners to have very accurate troubleshooting, understanding what has been going on with devices, and enabling that service technician to get there and fix that product, maintain the product, and be in and out very quickly. We see that moving and growing to do more advanced predictive maintenance.

Patrick Moorhead: Right.

Vivian Chow: Self-healing, so we’ll continue to be investing there. Another area where we’re already seeing AI deliver is in digitization and document workflow. We have tremendous image optimization in our scanning workflows. A sheet of paper, a document doesn’t need to be perfectly flat. It can have markups on it, but we can correct those. With OCR, we can do document routing and classification already. Again, we see an ability to take AI technology and move that forward, perhaps even someday doing some document summarization on device where appropriate. But I think there’s a couple more areas where we want to apply AI in printing that can be very valuable. One of them is in device management and security. Our devices and many devices out there know how to detect security threats of known vulnerabilities.

Patrick Moorhead: Right.

Vivian Chow: AI is going to allow us to be able to detect anomalous behavior for those things that are evolving. Again, we talked about cybersecurity attacks on the rise. When they’re powered by AI and they’re coming in with more sophisticated, different signatures, we’re going to be able to detect those before they’re widely known. The last one you may have heard in the keynote today earlier, was about print optimization. Again, imagine a time where you don’t have to do trial and error to get the right output. That you have a supernatural interface.

Daniel Newman: That’s what I need, I need one of those.

Vivian Chow: You need one of those, yes. An intuitive, natural interface.

Patrick Moorhead: Right.

Vivian Chow: For a user to get that output right whenever they need it, based on what we can deliver in the device through AI learning of document printing behaviors.

Patrick Moorhead: Right. I love it.

Daniel Newman: It seems like a perfect opportunity to say … You’re standing outside of a multi-function device and you could say, “Hey, print the screen I have up right now in my office, in 11 by 17,” or whatever your size is. What I’m saying is there’s now functioning and step functioning through, it just knows.

Vivian Chow: It just knows.

Daniel Newman: It’s like an LLM for print productivity. Of course, there’s lots of sustainable applications and more. Vivian, it’s been a lot of fun talking to you, appreciate you taking the time. Very thorough, very well planned out. It’s always very refreshing when someone is so emphatically clear on their business.

Patrick Moorhead: Yes.

Daniel Newman: Vivian, you did a really nice job. Thanks for coming on the show.

Vivian Chow: Thank you. Thanks for the opportunity to chat.

Patrick Moorhead: Definitely.

Daniel Newman: All right, everyone, hit that subscribe button. Join us for all of our coverage here at HP Amplify 2024, in beautiful Las Vegas. For Patrick and myself, we’ll be here in the chair all day, talking to the executives here at this exciting conference. But for you, you got to click onto that next episode. For us, we’re out of here.