Weisler: HP Is 'Putting Its Money Where Its Mouth' Is To Disrupt the Copier Market With Samsung Deal - New A3 Portfolio

HP Inc. CEO Dion Weisler Monday told 1,300 partners at its Global Partner Conference kickoff session that the company is "putting its money where its mouth is" to disrupt the copier market with its $1.05 billion acquisition of Samsung Electronics' printer business.

"You saw this morning our definitive agreement to acquire Samsung's printing business, when we commit to market disruption and leadership, we deliver," he told partners, hours after announcing the blockbuster deal. "It's the single largest transaction in print in HP's history. It strengthens our core. It accelerates our growth and it advances our future."

HP made a conscious decision to announce the Samsung printer business acquisition and its new A3 portfolio at the partner conference surrounded by the extended HP partner family that has supported the company for many years, said Weisler.

[Related: HP Tears Into Copier Market With Game Changing A3 Portfolio, Lowers Color Cost By 40 Percent]

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"This isn't just our acquisition, it is your acquisition because it is an investment in all of you," said Weisler, drawing thunderous applause from partners at the Boston Convention Center. "Our job is to provide you with the arsenal to be able to go out into the marketplace and win with confidence."

The Samsung acquisition provides HP with critical A3 intellectual property including the laser engine that is the heart of the HP A3 portfolio that was formally launched by Weisler on Monday. HP, in fact, has been working closely with Samsung, which already has an A3 lineup, for the last nine months on the new HP A3 portfolio.

Approximately 6,000 Samsung employees, including 2,000 engineers and 1,000 sales reps, will move to HP when the deal is closed over the next year. It also includes more than 6,500 Samsung patents.

The deal opens the door to a whopping $55 billion market opportunity where HP has less than five percent market share compared to its dominant position in the A3 market where it holds a 40 percent market share, said Weisler.

"Forty percent and five percent, something is wrong with this picture and we are going to fix it," he said rallying partners to the A3 opportunity. "Until today no one had a differentiated solution to attack that market."

Samsung brings a "compelling, disruptive A3 portfolio" that HP combines with its number one position in the printer market, said Weisler. "We couple that with our expertise in security and management assets and an unmatched partner network, unmatched distribution strength, all of you here in the room, and the future is what we decide to make it," he said.

Weisler said the new 16 product-strong A3 lineup, which is priced from $3,000 to $20,000 and is slated to ship starting next March, is aimed at delivering a more profitable business model for partners.

"With the industry's most complete lineup of A3 and A4 print solutions this extends your opportunity to grow your managed print services business with us," he said. "Today partner led managed print services is the fastest growing business in all of HP."

Partners, for their part, said the A3 portfolio, which includes both HP PageWide and LaserJet offerings, spells trouble ahead for copier stalwarts like Xerox, Ricoh and Konica Minolta. They expect the new HP A3 lineup to tear apart the copier market with a portfolio that promises 40 percent lower costs for color and a market-shattering lower cost of service.

Harry Zarek, CEO of Compugen, one of HP's top partners, No. 67 on the 2016 CRN Solution Provider 500 list, said the Samsung deal is a game changer for HP and its partners. "I really expect A3 to be a breakthrough product and technology for HP," he said. "It's very exciting. It's a whole new platform in a market that has been pretty dull up until now. HP is set to really disrupt this market."

Zarek said A3 represents two thirds of the total market – twice the size of the A4 market. "If we can displace the installed base over a period of time this is going to be a much bigger business for us than A3," he said. "We are bullish about the opportunity because everywhere we go we know we are going to displace somebody else."

Zarek said he sees the A3 business opening up an enormous managed print opportunity in the copier market that will drive more IT services business, including device as a service. "This is print as the Trojan horse to get us to do managed infrastructure on PCs, device as a service," he said.

Zarek credited Weisler with driving an innovation renaissance at HP. "He is building that innovation portfolio massively," he said. "We are really excited about what he is doing. It is great to be on this ride with HP."

Henry Fleches, CEO of United Data Technologies (UDT) one of HP's top partners, No. 106 on the CRN 2016 SP500 list, said HP has a tremendous opportunity to take its A3 portfolio along with managed print to customers with the partner ecosystem.

Fleches said he is looking forward to discussing the A3 opportunity with Wiesler and the HP team. He credited Weisler with driving a new entrepreneurial culture since the split from Hewlett Packard Enterprise last November.

"There is a sense of energy and engagement in the field," he said. "They feel empowered and that is showing up in our accounts and the cooperation between their field sales team and ours. Decisions are happening much faster. Decisions used to take months. They are now taking hours or a day or two. There is no question they are a much faster organization."

Eric Johannson, owner and president of Carlyle Printers Service and Supplies, Winnipeg, Canada whose business is up 50 percent this year, said he also sees the A3 opportunity as a "game changer" for HP and its partners

Competitors are going to have to respond to the new disruptive A3 product line, said Johannson. "It's great to see how quickly HP is moving with A3," he said. "Now that HP has this product lineup, we can now go in 100 percent with HP for our customers."