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Digital Printing: Boom or Bust?
INSIDER PERSPECTIVE
by Andreas Weber
Is digital printing a money-losing proposition? Certainly not. But if you believe recent reports, particularly in the German business press, you would think so. What led to this misconception?
On July 3, Heidelberg held a press conference to discuss the results of its last fiscal year. In the course of the event, digital printing was singled out as a source of losses. Heidelberg’s financial spokesperson, Dr. Herbert Meyer, acknowledged that the market for digital color printing was growing, but “it is still far below its potential and it lags behind our original expectations.” The business journalists took this message seriously (it came, after all, from the world’s market leader in printing presses) and assumed that it applied to the overall market situation.
In reality, however, digital printing is a booming market and a highly profitable one.
The fact is that only two of the classic press vendors (say which two)[Heidelberg with Nexpress and MAN Roland] offer digital printing products, and their sales of digital printing equipment are marginal (less than 100 million Euro worldwide).
Another fact: The market for communication via digital print media is growing. According to DigitaldruckForum in Germany the market will grow from around 30 billion Euros per year now to about 100 billion Euros by 2008. It is worth noting that Hewlett-Packard, in its Imaging and Printing division alone, had more profits (over $900 million) in the first quarter of 2003 than Heidelberg had total sales in the same period.
In addition, vendors of digital printing equipment, including Canon, HP, Konica, Minolta, Oce, Ricoh (and their customers) are experiencing revenue growth. Xerox, though struggling with a financial crisis, managed to invest $1 billion in the development of a new digital-printing technology and still achieve profitability. All of these digital printing vendors have many times more revenue than the classic printing-press vendors.
What’s it mean? The logical conclusion: innovative print providers seeking information about the “future of digital printing” would be well advised to pay a little less attention to the opinons of the printing-press vendors as reflected by the business press.
I suggest they instead pay attention to the way information is distributed today, as reflected in everyday business communications. Outside of the printing industry, the market for digital printing is booming. Here are the factors for success:
- Digital printing provides a stimulus to combine multiple media (for example, to combine Web publishing and/or interactive TV with digital printing solutions).
- Print can now be as up-to-date as database information.
- Digital printing makes a crucial contribution to mastery of the structural changes in the advertising industry. Advertisers do not want to pay for a maximized reach without a direct response and prefer to invest in individualized, dialog-oriented communication.
- The ability to individualize printed materials avoids the waste of indiscriminate direct-mail campaigns and promotes interactive communication with customers.
The prospects for digital printing are excellent and that is the message the business press should be getting. I am sure that the misconception that digital printing is a failure is an irritation to many people, both inside and outside the printing industry; and it is a distortion of the true situation.
Andreas Weber is founder of an online digital-printing forum, DigitaldruckForum.org, which deals with the issues of digital printing as a marketing tool. He is a journalist, book author, and communications expert. His company, @ndreas WEBer Global Communication GmbH, is located in Gutenberg’s home city of Mainz.
Published in Seybold Report, Volume 8, Number 41; July 16, 2003
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