Xerox predicts end of photocopy rivals

Printers Digital technology will reduce the market to key players.

Xerox CEO Paul Allaire has claimed that competition between hisrs. company and the other major digital imaging giant, Hewlett Packard, will force small competitors out of business.

According to Allaire, very few copier companies have the economies of scale, reseller partners or technology necessary to make the transition to digital products. He refused to predict, however, which companies will survive or die.

Observers have pointed out that Canon and Ricoh appear to be holding market share as businesses move from analogue photocopiers to digital printers and copiers. Mita and Panasonic are also likely to compete in the digital market. Allaire added: 'Some traditional copier vendors cannot make the transition. Four or five companies will dominate.'

The top five copier companies hold 60 per cent of the market and the rest is up for grabs, he said, because few companies have the quality, price competitiveness, channels and financial backing to succeed, even with a good product.

'Big companies will succeed because they can make boxes that work with everything else. People need to know that products will not bring the network down,' Allaire added.

Despite strong sales in the UK, Allaire admitted Xerox' European business is weak and told of hopes to improve its figures in France and Germany by recruiting resellers.

Two weeks ago, he met European business leaders, concluding that currency conversions would continue to damage Xerox's figures in 1998. He also admitted Xerox will not be able to manufacture enough to meet demand until after Q1 1998.

Xerox has not made any acquisitions for several years, but said it would only acquire businesses with technology it can develop itself.