Canon U.S.A. and Pharos Systems Align to Develop Embedded Document Management and Accounting Software for Digital MFPs.

NEW YORK -- Office and Higher Education Print Cost Accounting and Print Security Applications to be Developed for Canon's MEAP MFP Platform

Canon U.S.A., Inc. and Pharos Systems International, Inc., a developer of enterprise print asset management and cost recovery solutions for the higher education and office marketplaces, today announced an agreement to cooperatively develop new multifunction-specific applications using Canon's innovative Multifunctional Embedded Application Platform (MEAP)(R).

As part of the agreement, Pharos Systems, will integrate their Uniprint(TM) and Blueprint Enterprise(TM) products with Canon multifunction office equipment - enabling user-based authentication, accounting, and cost recovery features for Canon MEAP capable devices. MEAP, a technological first among multifunction product manufacturers, is Canon's unique, Java-based platform enabling the development and installation of customized applications to run directly from within networked digital MFPs. The integrated products are expected to be made available in 2006 through authorized Canon U.S.A. dealers and Canon Business Solution locations.

Pharos-enabled MFPs will provide unique solutions for both the general office and Higher Education markets. Integrated within the touch panel of the Canon MFPs, Pharos software will enable secure authentication, tracking, reporting and optional chargeback for all printing and copying. Additionally, Pharos PrintHere(TM) functionality will offer mobile users the ability to print to any Pharos enabled device and securely release their documents.

"Pharos has established itself as a premier supplier of cost control and asset management software for printing and copying environments in higher education and in the office," Sam Yoshida, director and general manager, Product Marketing Division, Canon U.S.A., Inc. "The capabilities of the Pharos application, coupled with Canon's innovative MEAP technology, will allow organizations to customize their printing and copying processes like never before, leading up to 10 percent-to-30 percent cost reductions and generally improved print/copy accounting and management."

According to Tom Cody, Director of Business Development at Pharos Systems, "Canon's MEAP platform allows Pharos to eliminate third-party network terminals and provide our rich set of software features directly on the Canon MFP display, significantly changing the way organizations track and control print and copy costs. By integrating Pharos' single-user interface with Canon's MEAP technology, we can provide users with the most sophisticated and efficient print processing and accounting solutions.

"In the University market, rising PC literacy, Internet, and email use, as well as the use of online resources and the access of online course materials, have all contributed to the rapid increase in print volumes, " continued Mr. Cody. "Student and faculty print centers are witnessing growing demand for multifunction capabilities, as well as higher image quality and color. Today's print volume is approximately three-to-four times that of copy volumes, with up to 50-80 percent of student printing resulting in waste. With all of these colliding factors, universities require MFP systems that will better help them manage, measure, and control printing and related costs."

Pharos' MEAP-based Uniprint application will reside on the hard disk of Canon-networked devices, thus eliminating the need, space, and expense for dedicated pieces of external equipment to execute customized programs. The application will be presented to walk-up users on the full-color LCD control panel of the MEAP-enabled imageRUNNER device, transforming the traditional MFP device into a powerful communications hub for sharing and managing information and printing across a network.

At Canon's EXPO 2005, Pharos Systems will conduct a seminar outlining print cost, security and management trends related to the higher education and general office marketplaces.

About Pharos Systems International, Inc.

Pharos Systems International, Inc is the recognized industry leader in providing print cost management and cost-recovery solutions to both corporate office and higher education environments. With over a decade of experience, Pharos helps customers track, measure, and control their print assets to reduce waste, recover costs and optimize their document output environment. Founded in 1992, Pharos has over 1,000 customers in 21 countries. Visit www.pharos.com.

About Canon U.S.A., Inc.

Canon U.S.A., Inc. delivers consumer, business-to-business, and industrial imaging solutions. The Company is listed as one of Fortune's Most Admired Companies in America and is rated #35 on the BusinessWeek list of "Top 100 Brands." Its parent company Canon Inc. (NYSE:CAJ) is a top patent holder of technology, ranking third overall in the U.S. in 2004, with global revenues of $33.3 billion. For more information, visit www.usa.canon.com.

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