Tidbits for the Week of 8/22/10

Hewlett Packard gave out details of last quarter’s financials from Imaging & Printing Group:
o Total revenue up 9% to $6.2 billion
o Supplies revenue up 5%
o Commercial hardware revenue (printers & MFPs, mostly made by Canon) up 4%
o Commercial hardware units up 44%
o Operating profit was $1 billion

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Shares of Pitney Bowes booked a new 52 week low by trading below $19.50 per share.

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Toshiba Corp. announced that it will implement plans to cut costs by $11.6 billion over the next 3 years. It hopes to accomplish this by negotiating better pricing from its suppliers.

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Xerox inventor passes away. Robert W. Gundlach was one of Xerox Corp .'s most prolific inventors, while his pioneering work in the science of photocopying made him a 2005 inductee into the National Inventors Hall of Fame.
o Mr. Gundlach died of aspiration pneumonia at The Shore Winds nursing home in Charlotte. He was 84.
o Mr. Gundlach was born Sept. 7, 1926. He earned a bachelor's degree in physics in 1949 from the University at Buffalo, where he did additional graduate studies in physics.
o He started with Xerox predecessor Haloid Co. in 1952, where he worked with Chester Carlson, the inventor of xerography, the science behind photocopying.
o Mr. Gundlach received 155 patents, with the technology he developed making possible advances such as desktop copiers.
o When he retired in 1995, he had 12 patent applications pending and he received his 155th in 2002.
o He received an additional eight U.S. patents outside of Xerox for inventions including a water-based heat pump system and a type of backpack.

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Some industry reporters are speculating that EFI is an acquisition target.
o The company has $490 million market capitalization and $200 million in cash.
o It is speculated that the board is currently reviewing its strategic options to boost enterprise value including buyouts by management or private equity.
o It is believed the board may be interested in a buyout proposal exceeding $600 million.
o EFI reported $ 400 million in revenue and a $2 million net loss in 2009.

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World Software Corporation, maker of Worldox, a very popular document management system (DMS) for law firms, announced launch of Worldox CompleteCloud, a secure virtual data center for law firms.
o Powered through a partnership with cloud provider CoreBanc Inc.
o CompleteCloud is a hosted environment complete with server and desktop software including Worldox, Microsoft® Office Professional and Microsoft Exchange – a full Windows desktop for one monthly price.

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About 80% of IT professionals at hospitals in the survey, conducted by Imprivata, say locking down patient information from breaches and unauthorized access is a top priority, up from 62% last year.
o 76% are most worried about confidential data breaches or abuse of their clinical applications as their biggest security concerns.
o 62% say they are able to track inappropriate access to data in order to comply with the HITECH Act's disclosure rules, while 38% cannot.
o 48% of the hospitals say they aren't sure whether their EMR deployment qualifies for the funding
o More than 80% use passwords for their strong authentication; 37 percent, biometrics; 35 percent, facility access cards; and 17 percent, tokens.
o 74% of the hospitals in the survey say they plan to spend more on security this year than they did in 2009.
o Around 97% say their purchasing decisions are driven by HIPAA and HITECH Act regulations.

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A man has been charged with smashing in a store window after they refused to refill his printer cartridges.
o Police said back in April, Scott Damsgard, 42, went into a business located in the 1300 block of Mendota Road in Inver Grove Heights, Minn., to get his printer cartridge refilled.
o Employees told Damsgard that they do refill cartridges, but only if they have a special sticker on them that shows they were bought there. His didn't have the sticker and he didn't have a receipt.
o Damsgard got upset and got into a heated exchange with employees and started swearing at them. Then while leaving the store, Damsgard picked up some landscaping stones and threw them at the windows.
o The windows smashed and had to be replaced. In all he cause more than $1,345 in damages. Damsgard was charged with first degree damage to property which can have a punishment of up to 5 years in jail and/or up to a $10,000 fine.

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A study of California hospitals shows minimal positive effects of EMRs.
o It concludes: “EMR implementation was associated with 6-10 percent higher cost per discharge in medical-surgical acute units.
o EMR stage 2 increased registered nurse hours per patient day by 15-26 percent and reduced licensed vocational nurse cost per hour by 2-4 percent.
o EMR stage 3 was associated with 3-4 percent lower rates of in-hospital mortality for conditions

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NSi (Notable Solutions Inc.) notified its customers of an issue it has with the OCR function of AutoStore. Apparently, it sources the optical character recognition (OCR) software from ABBYY of Russia (called FineReader), and recommends that customers do not use a setting below 70% for JPEG data compression, due to image quality issues. (in contract, Nuance eCopy uses OmniPage for OCR)

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Fujitsu announced it is now offering a new option for some of its scanners, the NSi AutoStore middleware software. This allows customers to use Fujitsu scanners and through AutoStore, have the images OCR’d and forwarded to document management systems

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Rice University announced it is ending its printshop’s experiment to go all digital:
o was launched in 2006
o Eugene Levy, Rice provost, said; “The hope was that, without the burden of having to maintain a print inventory, the press might sustain itself largely on revenues from print-on-demand book sales. Unfortunately, book sales remained very slow, and projections discouraged the anticipation that revenues would, in the foreseeable future, grow to a level that oculd materially cover even the minimal costs of operations.”
o The digital press was costing $150,000 to $200,000 a year.

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The founder of Minuteman Press International, Roy W. Titus, passed away on 8/12/2010. He started the print-for-pay franchise chain in 1974, which now has 940 locations world-wide.

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InfoTrends has released its annual United States Production and Copying Market Forecast, covering 2009 to 2014.
o This year's forecast predicts color printing will erode the monochrome market in placements and impressions during the next four years, rising from a 65% revenue share in 2009 to 77% in 2014.
o Light coverage color pages will become more cost effective and account for a higher percentage of color pages, particularly on high-speed roll-fed color devices

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Intel announced that it would acquire antivirus/security firm McAfee for about $7.68 billion, placing a price on the company’s common stock of about $48 per share.
o Santa Clara, Calif.-based McAfee will become a fully-owned subsidiary of Intel, and become a part of Intel’s Software and Services Group.
o The deal will close pending McAfee shareholder approval and regulatory clearance.
o Intel is apparently planning on using McAfee’s technology to add security to its Atom chip.
o Intel’s objective may be to grow its low-powered chip sales, by offering more and more functionality right on the chip (i.e. security, GPS, fax, scan, print, etc.)

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Xerox investors marked the 32nd anniversary of a date that changed the copier industry which was on 8/16/1978.
o On that date, the U.S. Federal Trade commission levied a $25.6 million fine on Xerox for anti-competitive behavior.
o The company was charged with using technical patents to lock-up the market for photocopiers and prevent competitors from getting a start.
o The company was forced to share some of the patented technology. Many of these licenses ended up in the hands of Japanese companies that quickly filled in the lower-end copy market.
o Although Xerox continued to hold onto the top-end segment for years, the loss of its patents severely shortened Xerox's ability to enjoy outsized profits for its years of R&D.

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Fuji announced it hired former Canon executive, Peter Brittliff, as its Marketing Manager for Production Printing Systems in Australia.

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Microsoft announced that it has sold 100 million licenses for Windows 7 operating system, making it the fastest selling Windows OS in history. Gartner Corp. has recommended that companies should upgrade from Windows XP to Windows 7 before end of 2012 to avoid compatibility problems. Microsoft will shut off support for XP on 4/1/2014. (Windows 7 has the new XPS print driver)

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Japan loses its place as the world’s No. 2 economy to China in the second quarter.
o China’s economy will almost certainly be bigger than Japan’s at the end of 2010 because of the huge difference in each country’s growth rate.
o Japan’s GDP was $1.286 trillion last quarter, while China’s was $1.335 trillion
o Japan’s per capita income is $37,800 while China’s is $3,600 (U.S. is $42,240)

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Accounting rule makers are proposing big changes to lease accounting:
o will affect some $1.2 trillion in leased assets worldwide
o under current rules, companies can keep equipment leases off their balance sheet and hidden from an investor’s view
o new rule will force companies to bring these assets onto corporate balance sheets
o companies would likely have to recognize a liability for future payments
o many companies are fearful that the change will force their balance sheets to balloon overnight, and change their leverage and debt ratios, forcing them to renegotiate covenants with their lenders
o “I guarantee it’s going to change return-on-asset formulas, return-on-equity formulas and debt servicing”, stated Jeffrey Taylor, an Arizona-based author of lease accounting.
 “People in the leasing industry think they can’t keep things off the balance sheet and operating leases disappear that it’s going to devastate not only equipment leasing, but also real estate leasing” said Taylor.
 “You’ll probably see a lot of people get out of the leasing business” said Taylor.
o The new standard would likely not take effect for several years.

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GE Capital may be brought under potentially stricter federal government oversight, due to the new Dodd-Frank Act, which aims to overhaul the financial sector. Some regulatory experts believe that it will be treated as a bank, which may impact its ability to lend. GE Capital has $41 billion lent out currently.

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Oracle Corp. filed a lawsuit against Google Corp. over alleged patent violations.
o Since Oracle, run by Larry Ellison, purchased Sun Microsystems, it also now owns Sun’s Java software intellectual property (IP)
o Java originally invented by James Gosling, a former Sun engineer
o Java serves as the foundation for many business applications, including Google’s new Android cell phone operating system, according to Oracle
o Many manufacturers are fearful that Oracle will file suit against them as well, including IBM.
o Java is used as part of the embedded system architecture in copiers from Canon, Ricoh and others

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Hewlett Packard announced it is acquiring Fortify Software, which specializing in making products that finds security vulnerabilities.

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Canon wastes up to $1.7 billion dollars according to Wall Street Journal. Canon announced in Tokyo it is giving up on its plans to enter the flatscreen HDTV market:
o Canon thought it had a new competitive technology, called SED (silicon emitter display)
o The plan was to launch the new Canon TVs during the 2008 Summer Olympics in Bejing, China with an expensive world-wide TV advertising campaign
o It also was planning on letting Toshiba relabel the TVs
o A Texas company, Nano Proprietary, sued for patent infringement and won.
o Canon has now decided to liquidate the division, and end the project

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During a recent dealer meeting, Toshiba invited a representative from Digital Copier Security Inc. to be a guest speaker. Digital Copier Security is the company responsible for the CBS Evening News feature on copier hard drive security that has caused a panic since it was aired in April, featuring Toshiba copiers.

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Industry author explains Xerox’s claim that their color systems offer 2400dpi:
o the print controller used (Fiery, Creo or generic) only sends 600x600dpi to the print engine
o Xerox VCSEL is using 32 laser beams to draw the image (vertical cavity surface emitting laser)
o toner particles are 8 microns each
o engine divides each pixel into 4 quadrants, to simulate 2400dpi (one pixel from 600dpi, divided into fourths equals 2400)

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