HP partially raised the curtain on its presence at Ipex with the “Commercial VIP event” that it hosted last week at the headquarters of its Indigo digital press division in Rehovot, Israel. An international group of customers, print industry journalists, and analysts attended, taking part in briefings, Indigo manufacturing plant tours, and visits to Israeli end-user sites.
The program included announcements about Indigo products that will debut at Ipex, but the specifics remain under news embargo until the event, which is mostly dedicated to digital printing and prepress, opens in Birmingham, UK, on May 18. There, Indigo will have the largest stand of any exhibitor, just as it will boast the biggest footprint at Graph Expo 2010 in Chicago in October.
Indigo’s plans to expand its already considerable share of the digital print market were outlined in an opening presentation by Alon Bar-Shany, vice president and general manager of the Indigo division within HP’s Graphic Solutions Business unit. With a workforce of 5,500 people in Israel, where Indigo digital offset technology was born in the early 1990s, HP is the country’s second-largest foreign employer.
Bar-Shany said that in sharp contrast with conventional offset, spending on digital printing systems of all kinds has grown significantly and should reach $6.4 billion in the next four years. He said that by 2014, “digital printing is expected to be the leading process in terms of hardware investments,” accounting for about 38% of all spending on printing equipment.
The number of pages produced on Indigo presses has increased almost sixfold since 2003, ”and we’re nowhere near close to the saturation point,” Bar-Shany told the group. He said that since drupa 2008, the recession notwithstanding, CAGR for Indigo impressions has risen in every production category including photo (45%), labels (28%), marketing collateral (13%), transpromo (33%), publications (27%), and direct mail (11%).
Photo printing remains the fastest-growing category as the digital output of prints, books, calendars, and other photo-based items replaces what remains of silver-halide processing. Indigo has a 75% to 80% share of the world market for digital photo printing, according to Bar-Shany.
In digitally produced publications, he said, “books are skyrocketing” in many categories from self-published works to Amazon titles via Lightning Source and books manufactured by general commercial printers. Label printing, said Bar-Shany, represents 20% of all volume produced on Indigo equipment and, together with other kinds of packaging printing, eventually will account for one-third of all Indigo output. The transpromo niche, said Bar-Shany, “is still very small,” although documents combining billing and financial information with personalized promotional content appear to be catching on in Latin America and other markets outside the U.S.
Much of this production is taking place on Indigo platforms introduced within the last three years: the 5500 and 7000 commercial sheetfed presses, the W7200 commercial web press, and the WS6000 web press for labels and packaging. Bar-Shany talked about their worldwide deployment: 1,000 installations of the 5500 in 74 countries; 400 installations of the 7000 and W7200 in 35 countries; and, in what he described as Indigo’s “fastest launch ever,” 100 installations of the WS6000 in 25 countries.
“Without the recession, we would have sold more,” declared Bar-Shany, who put the total installed base of Indigo presses at 5,300 machines in 3,300 customer sites around the world. As it concentrates on helping these and future sites to deliver higher-value pages, he said, “we’re probably not going to grow to 10,000 customers.” Indigo’s strategy, rather, will be to enable “a relatively small customer base to be highly profitable.”
Bar-Shany also spoke of opportunities created by “the increased pull from enterprises for digital printing.” This, he explained, arises from the desire by corporations and other high-volume users of print to preserve cash by reducing their inventories of printed matter. Enterprises, seeing digital print-on-demand as the key to controlling their inventories, are coming to Indigo for help, Bar-Shany said. He added that Indigo would provide it in the form of advice to the printers that the enterprises already are using, as opposed to offering facility management services directly to the enterprises.
Opportunities also multiply “when you look at printing as an IT industry” capable of serving enterprises and other customers with data-intensive operations, Bar-Shany said. He noted that Indigo has come a long way in a relatively short time since the launch of the first Indigo press, the E-Print 1000, at Ipex 1993. In the first few years after that show, he said, there basically were “no pages” coming out of Indigo presses—a far cry from the 100 billion pages that HP expects them to produce by 2016.
A tour of Indigo’s combined ink manufacturing and press assembly plants in Kiryat Gat gave insight into how the division is gearing up technically for page output by its customers on that scale.
At the Kiryat Gat ink plant and a twin facility in Singapore, Indigo formulates ElectroInk, an electrophotographic liquid ink consisting of resin, mineral oil, and standard pigments. CMYK ElectroInks, packed in sealed canisters that snap in and out of Indigo presses, are produced at the main plant. Special-order inks come from a smaller facility in Rehovot. Indigo also offers an ink-mixing setup that can be installed at customer sites, enabling end-users to match up to 97% of the Pantone gamut from 11 basic colors of ElectroInk.
Like the ink plant, the adjacent hardware center follows systematic quality-assurance routines. Opened in 2007, this facility is where frames, feeders, and other contractor-supplied components are assembled with imaging engines into finished presses. Presses are assembled strictly to order, and their just-in-time production is governed by Japanese-inspired rules of lean manufacturing. Team-driven kaizen events are used to solve problems and maximize throughput at every stage.
The Commercial VIP event also was an opportunity for a number of Indigo’s technology partners to talk about and in some cases show their wares to visiting customers, journalists, and analysts. Among those introducing themselves with table-top displays at Kiryat Gat were Folex, which makes specialty films for Indigo presses; MindFire, a developer of personalized cross-media solutions including variable print; Felix Schoeller, offering digital photo papers and other imaging substrates; and Scodix, an Israeli company with a UV inkjet “digital enhancement press” that can coat and chemically emboss with variable-data input.
(Watch WhatTheyThink for video interviews with Indigo personnel in Israel—Ed.)