Tech future is bright, but it won’t be printing money

The year is looking bright for virtually every tech segment as far as IT spending is concerned.

Well, except for printing.

A Tuesday J.P. Morgan note paints a rosy picture for IT spending, thanks to the gangbuster growth of tablets and the momentum in data storage and networking as businesses embrace the cloud. Even the personal computer market, after being battered by the hard disk drive shortage following the Thai flooding disaster and generally weak consumer demand, should expect some improvement, the note says.

“The overall trend-line is directionally upward, which we think sets the stage for a sturdy 2012,” analyst Mark Moskowitz writes.

But for printing, the trend-line is still pointing downward.

While J.P. Morgan projects IT spending growth for most segments, led by a whopping 38% for tablets, printing is expected to fall about 7%. The reason: printing simply isn’t a big priority anymore.

“The printing segment appears to be reverting to its secular declines after the post-downturn capital investment cycle from mid-2010 to mid-2011,” J.P. Morgan said. “Printing continues to diminish as an IT spending priority for enterprises, and we believe a similar pattern exists for consumers.”

Moskowitz added that “we expect consumers to depend less and less on printing in coming years as smartphone and tablet adoption rates increase. With photo-sharing apps and GPS capabilities, these mobile devices increasingly substitute for the prior use cases of printing hard copies of photos and street address directions.”

This poses a challenge for Hewlett-Packard H-P


, the giant of the printer market.  In February, during H-P’s last quarterly earnings call, Chief Executive Meg Whitman acknowledged the company’s printing woes.

“The printing market is more mature, and more mature markets tend to be governed more by macroeconomic forces,” she said. “I think we’ve got to really look hard and say, okay, we may not see an overall secular decline, but we do see pockets of decline. What we know is that consumers at home are doing less photo printing, for example.”

– Benjamin Pimentel

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