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Well, there is no point beating about the bush when things stare at us right in the face. A difficult market took a heavy toll on the printer segment. One of the worst hit sectors in FY 09, the printer market was totally lackluster showing an overall decline across all categories. Neither of the high growth categorieslaser and inkjetwhich till now had a pretty good track record, grew. Dot matrix did grow a little but at an almost flat 2%.

While the first half of the fiscal was exciting, the fortunes turned for the worse in the second half. That of course was the time when the entire IT industry was becoming a casualty of the global downturn. For the printer market, it was primarily on count of the cautious spending outlook that the corporates and SMBs adopted to meet the challenges of operating in a tough environment. While in both unit sales and absolute terms the market was down, a significant drop in the price of printers across all categories was an important factor contributing to this slack performance.

Even though the market did benefit from the big push being unconsciously provided by an increased spending by the government in carrying out its e-governance mission, it wasnt anywhere close to offsetting the huge losses. For Canon, government contribution to its business went up drastically, to stand at 50% at year closing.

CyberMedia Research  DQ Estimates

The total printer market took a steep dip by over 18 points. All the growth categories including laser MFDs and single and Inkjet single and MFDs performed poorly. However, surprisingly, only dot matrix grew a bit

Out of all the four key segments (inkjet single and MFDs, and laser single and MFDs), it was the single function lasers which suffered the most, going down by 39%. Inkjet single function too was not very far behind with a dip of 30%.

Even though laser MFDs too declined by 11% (it was pegged at Rs 796 crore, it still made up the largest bulk of sales in the overall printer market (close to 52%) in FY 09. Interestingly, dot matrix printers became the second biggest contributor to the overall printer segment last fiscal, contrary to market expectations as evryone assumed that they had lost their sheen long back.

According to the MAIT-IMRB report on IT peripherals, it is the smaller towns and cities outside the top eight metros that drove printer consumption, accounting for a significant three-fourth of the overall printer consumption in the country. At the same time, it points out that sales of printers in the top four and the next four cities registered a decline of close to 9% and 31% respectively in 2008-09.

CyberMedia Research  DQ Estimates

Whichever way one looks at it dot matrix emerged as the real hero, even though growth was almost flat at 2%. Epson maintained a wide lead, by keeping over 54% of this market

According to industry estimates, SMBs accounted for over three-fourth of the total printer sales. The large establishments however, witnessed a decline of 38% in revenue in 2008-09.

Notwithstanding the overall low-key market sentiment, what was significant last year was how some of the players (primarily Canon and Samsung) moved up the value chain with a fairly healthy run in laser printers (single as well as multifunction printers put together). On the other hand, HP lost ground, not just in these two categories but on inkjet as well as.

CyberMedia Research  DQ Estimates

Inkjet single function printers put up a sad show with a decline of 30%. HP was the market leader here, followed by Epson. Though there was not much excitement in this market in terms of new product launches

The Real Hero
Whichever way you look at it, dot matrix printers emerged as the real hero (albeit a small 2% growth). This one is for all the detractors who thought dot matrix was on its way to a slow death. Surprisingly, or maybe not for some, this was the only category within the printing pie which did not witness a decline, thanks to a gamut of infrastructure projects, retail, government (e-governance drive) and education that provided a push, big enough to sustain dot matrix at a time when all its richer cousins cut a sorry figure (posting negative growth).

CyberMedia Research  DQ Estimates

The Inkjet MFDs too fell down by 22%. Here too, though HP retained its leadership position, there was a significant dip in its share as compared to last year. This was primarily because of the inventory correction that it took in OND

Epson, TVS-E and WeP were the key players in the market that grew at 2%, which is at least better than the decline of other popular printer segments.

In fact, according to the MAIT-IMRB survey, dot matrix performed pretty well in the first half of FY 09 (April-Sept) by growing at 28% as compared to the same period in the previous fiscal.

One wonders, what it is that kept the dot matrix meter ticking at a time like this. Market readers point out that besides the price factor, which obviously works in its favor, there was a slump in households buying inkjets and laser printers, and a little portion of that shifted allegiance.

CyberMedia Research  DQ Estimates

The laser single function printers segment was the worst effected with a decline of 39%. HP went down by a huge margin, while Canon and Samsungs share significantly jumped up

Epson retained its leadership in dot matrix; in fact it gained about eleven points over the previous year. While on the other hand, TVS-E went down by eleven points, as its overall revenues also went down steeply. WePs share at 18%, more or less remained stable. For Epson, which now has a market share of 55% in the dot matrix range, government and education constituted about 30% of its overall share. The rest of the 70% primarily came from its traditional strongholdsbanking (financial institutions), logistics, transport, and PSUs. While infrastructure also looked up during the fiscal, volume- wise it was still quite small.

CyberMedia Research  DQ Estimates

The market was not kind to the laser MFD category, which earlier has grown by good margins. Though this category of the printers market pegged at Rs 796 crore still constituted the biggest chink of the overall market

One thing which obviously emerges clearly is the fact that dot matrix is not going to die easy, or maybe never at all. As a matter of fact, one trend that has shaped the market ever since the other categories like laser MFDs gained more acceptance in the market indicated in terms of unit sales is that dot matrix has more or less always maintained a status quo. And, of course, the fact that it has managed to grow (even though by a slight margin) in a year where pressures were felt from all corners, reconfirms this.

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