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3/9/2006
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Dell To Delve Into Print Managed Services

Dell is poised to enter the print managed services space with a "cradle-to-grave" offering designed to extend the company's sales reach inside the enterprise, a top executive said.

Dell is poised to enter the print managed services space with a "cradle-to-grave" offering designed to extend the company's sales reach inside the enterprise, a top executive said.

Joseph Marengi, senior vice president of Dell Americas, said Wednesday at the Morgan Stanley Semiconductors & Systems Conference that Dell also is ready to jump back into its strategy of slashing prices on low-end printers as a way to boost system sales.

"Printer managed services are the same as when we went into the Dell managed services, and eventually they will wrap under the same umbrella," Marengi said at the Dana Point, Calif. conference.

"We’re going to manage [customers’] print infrastructure--outside of the big production print machines they have--across their entire business," he said. "And that would be everything from replacing the [printer] asset that exists in there today with a new Dell asset and managing and taking care of the asset, making sure there’s always paper there, making sure there's ink and toner always there. And when it comes time for the life cycle of that product retiring, [we’ll] replace it with a new one. It's a kind of cradle-to-grave, if you will, for the printers inside of a corporate or public institution."

By entering the printer managed services arena, Dell would be following rivals like Xerox and Hewlett-Packard, which provide those services in the United States largely through solution providers. Marengi stopped short of detailing how Dell would build an infrastructure to provide print managed services or if the company also would provide workflow consulting services, which are now provided in part through the channel by Xerox, HP and Lexmark, among others.

Marengi noted that, ultimately, Dell’s printer business exists for other purposes beyond imaging. "At the end of the day, the conclusion is that we need to sell the system," he said. "If the printer helps sell the system, we may go back and work with [discounting] again. We may go back to doing promotions on single-function [printers]. It depends on where we are in the course of a year."

Dell boosted its unit sales on the low-end printer segment last year via a series of aggressive promotions, including bundling some inexpensive printers with desktops. However, Dell executives have said such promotions aren’t a practice they like, because customers that get free printers are less likely to use them and order high volumes of consumables.

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