By Noel Ward, Executive Editor
November 9, 2007 - InfoPrint Solutions Company, the joint venture between IBM Printing Systems and Ricoh became official back on June 1. Now, five months later, it seems like a good time to take a look at what's taken place and how IPS is thinking about the marketplace for its technology moving forward. ODJ talked with Jeff Patera, Senior vice president and General Manager of Technology Solutions Development at IPS to hear about some of the key issues for the company today.
ODJ: What applications does InfoPrint Solutions see as offering the greatest potential for their customers and the present equipment offerings?
JP: There are three main areas we see, Noel. The biggest are the trans-promo applications. These aren't a new thought, because they've been talked about for several years. The printing itself has not been the hard part, but the technology behind it was more difficult. Now the rest of it is starting to appear: there's more color, the software is ready, and most important, the ability to target messages at an individual level is all coming together.
The next area is direct mail, which is not new at all, but companies are now much more able to do the data mining that's necessary to make direct mail a true-one-to-one application, in full color on a digital printer
Then there are books, which are clearly a growth area. In book publishing we are seeing more and more pages move to digital from offset printing. This is driven by improvements in output quality for both print and images as well as the ability to print very low volumes profitably. This is opening up publishers' backlists, bringing out-of-print titles back to life, and helping publishers change many of the ways they do business.
ODJ: Trans-promo is certainly a hot topic. How quickly do you think trans-promo printing will gain traction?
JP: I think it will start to grow quickly. There are some enablers in place to help it do that. First is cost. There are devices starting to appear that make the cost equation more attractive for print providers and their customers. Then, as color is used for the trans-promo messaging, other things on a statement will also benefit from color, such as balance and account information and other communications that aren't marketing oriented. Of course, there are some bridges that still need to be crossed. It will be very important to look closely at response rates on the marketing, the data used to drive the trans-promo messages, and the messages themselves. And then there's the issue of how to use space most effectively.
ODJ: I agree on those issues but what's your sense of the timing is it one year? Two? Maybe three?
JP: I think we'll see significant growth in 12 months. I think everyone in the industry is hard pressed to put firm number on it, but 2008 will be the year it starts to really grow. Like many other things there is a certain amount of a "chicken and egg" concept to trans-promo. But the technology is here, the costs are inline, the quality of printing is good. Now it's a matter of how we use it.
ODJ: Many people are interested in your color strategy, especially whom you plan to sell to. Tell me about your strategy in that area. What are the best applications for your color technology?
JP: We see trans-promo and direct mail as the best areas for our color technology. Both are an excellent fit for the InfoPrint 5000 and our software.
ODJ: Makes sense, but do you anticipate color going first to existing IPS customers or do you think people who have Xerox or Océ boxes will now put IPS on their shopping list for trans-promo boxes?
JP: Our existing customers are very interested in color. Clearly, the InfoPrint 5000 can be viewed as complimentary to our 4100 model in many environments, but it is certainly not a replacement. We have customers with InfoPrint 4100s who are buying the InfoPrint 5000 to give them high-speed color capabilities. Not only that, we are seeing new customers who are interested in digital color seeking to move from offset printing.
ODJ: The InfoPrint 5000 puts down great color for trans-promo and some direct mail applications, but really doesn’t don't have graphic arts quality color. Is that of any importance to the IPS?
JP: We think there is a market for that kind of quality, but we aren't intending to service those needs with this product. The speed of the InfoPrint 5000 is much higher than any of the graphic arts printers and for our customers --environments where full color direct mail or statements are needed in tight print windows-- that's where we have a fit.
ODJ: The monochrome print quality on the InfoPrint 4100 seems to be lagging a bit behind Océ and Xerox. In fact, LSI (Lightning Source) noted print quality as one of the reasons they shifted to the Océ VarioStream for book production. What are you doing to raise the bar on print quality?
JP: We clearly recognize that there is growing need and market for quality and for different types of quality, especially with regards to image. We are continuing to focus on that area, which is a key research and development area for use moving forward.
ODJ: How does IPS plan to rationalize the production business that Ricoh is going after with business that could also go to IPS? Don't they wind up competing?
JP: From one perspective, we could wind up competing. But step back and you see that the business units are very complimentary. Although Ricoh is serving some customers who do production work, we really serve different types of customers so the overlap is fairly minimal.
ODJ: Vendors like HP, Kodak and Xerox are offering tools and training to help customers reach out to new customers and develop new markets. What kinds of things is IPS doing to help customers in these areas?
JP: We have a professional services organization, that in addition to providing customer solutions, does work on a consulting basis to help customers in this area. We will continue to expand our services in this area.
On a related note, we have also just announced a developer support program intended to enable our technology partners to collaborate with InfoPrint’s team of experts on planning and testing of output solutions prior to implementation. Testing solutions prior to implementation helps iron out quality issues which is, particularly important where color output is involved. We've had this in pilot mode for nine months with companies like Exstream Software, GMC, Pitney Bowes Group 1, Printsoft, and XMPie and it's working out very well.
ODJ: What is InfoPrint Solutions doing to combat the seeds of doubt being sown by competitors who say IPS/Ricoh won't be able to care for customers like IBM did?
JP: We try to keep this on a fairly high level. And we simply stick to the facts. And here they are: This business is growing and it has grown since the announcement. Our main focus is growing the business. Ricoh is bringing investment funds to the table which supports R&D and development of new solutions. We are growing our coverage worldwide with the ability to deliver to customers around the world. With Ricoh, we have the backing and investment needed to do that and we have unique capabilities which we will grow and build.
ODJ: Tell me more about the unique capabilities.
JP: We offer a wide range of capabilities and skills that enable us to offer customers complete end-to-end solutions that improve the efficiency of operations. For instance, workflow is very important, so we take a manufacturing view of a print shop that runs from data through delivery. We have implemented solutions in companies around the world that increase efficiency and reduce costs. Those skills for both print and output environments are core to what we are and what we bring to table.