Commentary & Analysis
FREE SPECIAL: Xerox, NexPress, Scitex Digital Printing & Canon Discuss Color on the Same Stage
By WhatTheyThink Staff
Published: April 25, 2002
This morning’s keynote at the On Demand Conference included presentations from four major digital color vendors and opened with Charlie Corr, Group Director, CAP Ventures, commenting that the "market for digital color printing is about to explode." According to recent CAP Ventures research with print buyers, the biggest current obstacle is "not quality, substrates or lack of Pantone colors, but price."
The biggest plus was fast turnaround time. If the retail price fell to 25 cents (from about 59 cents today), it would satisfy 46% of all color printing. When and if it falls to 8 cents, digital color will satisfy 68% of all process color jobs, 52% of spot color jobs and 42% of all b/w. His conclusion is that the digital color market will continue to grow at a rapid pace and "the print market will be totally transformed once lower price points are achieved."
Frank Steenburgh, Senior VP and GM, Xerox
The four digital color equipment vendors differentiated their products. Frank Steenburgh, Senior VP and GM, Xerox, stated "your future success will be determined by your ability to build your digital color business..period." Also known as the "Father of the DocuTech," Steenburgh reminded the audience that the digital printing industry was begun with the enormous success of the Xerox DocuTech in the early 1990’s—now 25,000 installed and still going strong.
He emphasized Xerox’ 12 years of knowledge, including digital color which started in 1994 and resulted in a successful series of products culminating in the DocuColor 2000 series—"the most successful digital color press ever" with 5000 installed in less than 2 years—and now the iGen3. Steenburgh differentiated the iGen3 with the suggestion that buyers should look for a total package of equipment, service, support and solutions and the promise that "Xerox will do this better than anyone else." Xerox will be offering SmartPress Production consultants on-site for 2 months to help with business and marketing plans, workflow and application coaching.
Homi Shamir, President and CEO, Scitex Digital Printing
Homi Shamir, President and CEO, Scitex Digital Printing, also pointed to history and stated that his company "invented personalized direct mail and scratch-off lottery" applications in 1993. Scitex equipment has been running 1000 ft/min and has been the product of choice among direct marketers for the past 20 years. The company has been focused on transforming transactional documents, first in b/w and now with business color. Customers wanted low cost, high speed and to eliminate preprinted stock. Shamir defines business color as "the right quality at the right place and time with the right price."
In order to accommodate entry level users, Scitex has introduced the VersaMark Advantage for lower volume at a lower price. For $400K to $1.2M, depending on features, Scitex will provide affordable business color. Shamir reported an impressive 2 cents per page, including equipment, consumables and support (excluding paper.)
Venkat Purushotham, President and CEO NexPress Solutions
Venkat Purushotham, President and CEO NexPress Solutions, added to the historical perspective by noting that joint venture partner, Heidelberg, has been in the printing business for 154 years and joint venture partner Kodak, in the imaging business for 105 years. Having been formed in 1998, NexPress has been quick to market by announcing at DRUPA and shipping one year later with installs now exceeding 170 in 12 countries. Purushotham explained that "consumers are driving the industry to change" and that commercial printing needs to print documents that are relevant, current and have rich content with color and graphics.
He indicated that buyers should look at the "total cost of printing a job end to end." NexPress has an exceptional 70% of service calls handled on site due to the online diagnostic tools, and they plan to reach 100%. Another goal is to "help the customer grow higher value services." Current customers have exceeded print volume targets by 20% and more than 80% of customers regularly produce jobs with a run length greater than 1000, most of which are variable print. Purushotham highlighted their NexTreme software, the first to use the PPML/VDCX open standard providing device independence and the ability to accommodate more sophisticated high variable data jobs. He gave the operating cost of the NexPress2100 as 4 to 10 cents per page.
Mason Olds, Director and GM, GSD, Canon USA
Mason Olds, Director and GM, GSD, Canon USA, reviewed Canon’s success in many business areas over 60 years, including their healthy balance sheet and 2001 revenues of $22B with profits of $1.2B. 7% of revenues are re-invested in R&D and Canon has been among the top 3 companies in US patents granted. In 1987, Canon introduced the CLC1, the first digital color copier. They have transitioned their product line through the years to digital devices and expanded to higher speeds such as the CLC 5000 with the EFI controller.
Olds proclaimed Canon the "leader in color" with 50,000 units in use, 8,000 of which are production oriented. He noted the two arenas of printing in the corporation-- the department and centralized production-- and that Canon products cover both. Asking "why send filed to a production area if they can be done in your own area?" he answers this by suggesting it will happen if production units offer more. With 16.5 billion prints from presses having the potential to be migrated to digital, Canon has become more focused on production and the graphic arts market. Olds thinks that the Canon strategy of having distributors, such as IKON, Danka and Canon Business Solutions in the Northeast, provides better local application support and unique solutions for customers. Canon will keep costs down with their precision manufacturing capabilities and continue a solutions-based approach to the market. According to Olds, "Meeting customer needs will decide the winner."
When asked about color quality, Steenburgh replied "Customers tell us the iGen3 has the look and feel of offset," Shamir said, "We are providing business color and not competing with offset," Purushotham replied "Quality is not a barrier any more; buyers are more focused on turnaround and stocks," and Olds said, "To get great quality from a device for 5 to 10 years is still a challenge to be overcome."
Another question about the importance of retail price resulted in these responses: Steenburgh: "We must continue to drive costs down going below 5 cents," Shamir: "Absolutely," Purushotham: "It is only one of many issues, but we need to focus on cost per response and building volume with services," Olds: "There has to be more value given to a printed piece; cost is related to value."