On Monday, HP Inc. made two major announcements for its commercial printing business. HP Inc., which comprises the former personal systems and printing businesses of Hewlett Packard, revealed that it would not only acquire Samsung's printer business for $1.05 billion, but also that it is releasing a new line of A3 (yes, the paper size) multi-function printers (or MFPs) that are meant to go head-to-head with purportedly less-versatile and more complicated A3 copiers from other manufacturers.
Through the $1.05 billion deal with Samsung, HP will take on Samsung's portfolio of printers, its 6,500 printing patents, and a workforce of 1,300 researchers and engineers. With these assets, HP hopes to "disrupt and reinvent the $55 billion copier industry." HP thinks that customers have grown frustrated with the costs of operating and maintaining the current copiers on the market. The company believes that Samsung's multi-function printers are superior to existing copier technology. HP expects that Samsung's MFP know-how, combined with its own printing expertise, will help it offer simpler, more reliable devices with fewer, more easily replaceable parts.
HP expects this transaction with Samsung to take most of a year to close, but the company isn't waiting to deliver new products. Hours after announcing the acquisition of Samsung's printer business, HP announced a new A3 multi-function printing lineup that includes 16 new multifunction printers. HP claims that these devices offer heightened security, efficiency, and more affordable color prints and copies than other offerings in the market.
These moves follow some disappointing second-quarter financial results for the newly-split-out HP. The company reported to investors earlier this year that the revenue of its printing business was down 16% year over year, in part due to 18% lower consumer printing hardware sales and 16% lower supplies revenue. Even if consumers are printing less, paper copies appear to remain important in many industries. If Samsung's printing business can help HP deliver on its promises of more efficient and reliable copiers, perhaps that billion-dollar acquisition will be worth it.