Cary Sherburne:  Hi, I'm Cary Sherburne, Senior Editor at WhatTheyThink and I'm here with Marco Boer from IT Strategies.  Welcome.

Marco Boer:  Thank you.

Cary Sherburne:  We're here at Drupa 2012 in rainy Dusseldorf. 

Marco Boer:  Once again.

Cary Sherburne:  And I'm curious, other than the spargle, what are the top trends that you're seeing here at the show?  I mean, what do you walk away with saying, "Wow, this is going to make a difference to the industry?"

Marco Boer:  I think there's three big trends.  The first one is as one of my friends at Fuji quotes we're having a hard transition from analog to digital now.

Cary Sherburne:  Okay.

Marco Boer:  And it's hard in the sense that, yes, okay, 98 percent of pages are still printed using analog technology, but the fact is in terms of equipment sales – it's all digital.  And so we've hit the wall.  So, not good for the analog press guys.  

Cary Sherburne:  Which is why they're all going digital.

Marco Boer:  Well, and some might say the announcements with Heidelberg, Komori, Manroland moving to Landa Technology and so forth, it's not strategic.  I mean it's out of sense of weakness I would say.

Cary Sherburne:  It's sort of a technical – it's a reactive strategy.

Marco Boer:  Yeah, they have no choice.  I mean they have to do something and they've waited too long and this is it.  The second big theme in this entire show is we have – in the digital production space – had specialty printing for a number of years now.  And it's been very high value, but nichey.  You know photobooks and so forth.  And that's a wonderful business to be in.  The challenge is there is going to be an upper ceiling at how much you can expand that market.  There's only so many photobooks somebody might want to produce every year.

Cary Sherburne:  Right, exactly.

Marco Boer:  And so as a result we have to get the next level, right, of productivity, in order to get more pages. 

Cary Sherburne:  Okay.

Marco Boer:  And so the big theme here is one, B2 size presses or half sheet size presses to get to the productivity – digital.  But more importantly what's really coming out of it is there is a sense collectively that we need to be able to print on the substrates that people want to print on.  And so that is –

Cary Sherburne:  Oh, what a novel idea.

Marco Boer:  And so that is a real significant issue because today dry toner is physical limited to a certain amount of productivity.  And I think we've more or less hit the wall there.  

Cary Sherburne:  Right.

Marco Boer:  In fact if you walk around the show floor I don't think there is a single new dry toner machine in the entire show floor.

Cary Sherburne:  But there's a lot of liquid toner.

Marco Boer:  There's a lot of enhancements.  I saw liquid toner obviously is one theme and the reason for the resurgence in interest and re-validation almost is that liquid toner you can control the particles very well and the linear throughput speed is significantly higher as a result.  So liquid toner is one way to get around the issue of substrate independence and as you go faster of course, that adds to costing.  The second way to do it is perhaps UV inkjet.  

Cary Sherburne:  Okay.

Marco Boer:  Because there you also get around the issue of substrate independence.  The third way to do it is with precoats or postcoats using ichorous inkjet.  And the fourth way to do it is through hybrid technologies like nanography where you are basically controlling the chemistry in an intermediary process before it hits the substrate.  So what's the right answer? Who knows?

Cary Sherburne:  Yeah.

Marco Boer:  The point is that people are paying attention to it and it's frankly a really exciting time.

Cary Sherburne:  Yeah, and then the third thing.  You had three things.

Marco Boer:  And so the third thing is -- and you know it's basically a reflection of the second thing – is people are still investing a lot of money in this.

Cary Sherburne:  The develop—the manufacturers.

Marco Boer:  Yeah, we are talking HP cited a billion dollars in the past four years, Memjet's apparently burned through 800 million and not much to show for yet.  And so this is a serious, big investment kind of business.  And ultimately that then leads to the last bit of point two-and-a-half – and that is packaging.

Cary Sherburne:  Okay.

Marco Boer:  Because the print industry as a whole is perceived by the outside world as basically dying and while the page volumes of course are indeed going down and it's irreversible, the fact remains that digital printing is growing and ultimately packaging will never go away.  

Cary Sherburne:  Right.

Marco Boer:  So packaging is the carrot that people are putting out to the world at large saying how wonderful print is going to be.  And you know it's going to be a long, long journey but once we get there indeed it will not go away

Cary Sherburne:  That's right.  And moving more and more to digital…

Marco Boer:  Right.

Cary Sherburne:  …technology.

Marco Boer:  Absolutely.

Cary Sherburne:  Well, that's great.  Thank you.  That's very insightful.  Thank you 

Marco Boer:  All right.  Thank you, Cary.