Konica Minolta and Fujifilm ponder JV to cut costs of printer businesses

Japanese giants have big brands, but tiny shares of a shrinking market

Japanese imaging manufacturers Konica Minolta and Fujifilm have revealed talks aimed at creating a joint venture to handle printer manufacturing and R&D for both brands.

The two orgs published identical statements on Monday that declare their intention to "optimize procurement, toner development, and production efficiencies" for multifunction printers (MFPs) and other printers.

"The rapidly evolving market landscape for MFPs and printers requires proactive measures," the statement reads, adding that the potential alliance is hoped to "strengthen their business foundation including the development of a robust supply system for their products."

The plan under discussion will consider a "procurement business alliance" to "coordinate the procurement of raw materials and parts" – hopefully by Q2 of 2024. Fujifilm Business Innovation Corp would be the majority shareholder of the joint venture.

A second element of the plan will see the creation of a "toner development and production business alliance." The two firms are also discussing "other strategic collaborations related to the subject business" in separate talks.

Canned statements from the two CEOs mention improving costs and competitiveness.

Konica Minolta boss Toshimitsu Taiko described the talks as possibly helping to "strengthen capabilities for stable supply, environmental initiatives, and business continuity plans, and pursue the potential for enhancing business resilience as global manufacturers."

It's not hard to understand why Taiko and his Fujifilm counterpart Naoki Hama worry about such matters: analyst firm IDC recently found a 15.5 percent year-on-year decline in hardcopy peripheral shipments in Q4 2023.

Just over 21 million units moved in the quarter, IDC found – down from the almost 25 million machines that shipped in the same period during 2022.

The value of shipments also fell 11.7 percent, to $9.7 billion.

Critically for Fujifilm and Konica Minolta, neither featured in IDC's list of the market's top five players. That leaderboard is topped by HP Inc with 33.4 percent market share, Epson's 22.1 percent share, Canon's 21.2 percent slice, and Brother's 9.6 percent.

China's Pantum scored fifth place with 2.6 percent market share.

That means Fujifilm and Konica Minolta each has a tiny market share and they're scrapping in the 11.1 percent of "other" suppliers noted by IDC.

That small market presence surely makes it hard for the two Japanese concerns to maintain independent product development efforts or score good deals from suppliers – so the JV looks entirely sensible.

Whether a tie-up will help either brand to survive in the long term is anyone's guess. IDC's numbers report a long-term decline in the printer market overall. The internet and smartphones – tech you may have heard of – have contributed to the demise of printers by removing the need to apply pigment to sheets of cellulose in many workplace settings. ®

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