Whenever new technology is introduced, adoption typically takes place in predictable phases—first in value-added high-margin niches. Once it gains a foothold, it eventually goes mainstream. Such is the case with digital printing technology. In every segment where digital printing technology has enjoyed success, there is a recurring theme: print producers want technology vendors to show them that
the new product can produce print quality that is equal to or surpasses the incumbent
The 8X loupe test
This practice, which can be called the “8x loupe” test, maintains that you must be able to replace the dominant, existing technology with something that delivers comparable performance and quality. In most cases, digital print technology vendors have done exactly that and have successfully met print quality criteria.
However, when you look at the offset-to-digital-migration, there are exceptions where digital has successfully ousted offset. Most notably, this has been when digital does not threaten core high volume market segments, where the focus is more on lowering production costs and improving productivity and less on quality or where there is a requirement for higher value personalization.
In these cases, the tradeoff clearly favors digital. Consequently, digital print has tended to thrive in environments and applications that require short runs, versioning, distribute-and-print, and printing of variable data intensive documents like direct mail, personalized collateral and invoices and statements.
However, digital printing technology vendors have thrown down the gauntlet, introducing digital technology that is more mature, delivers better quality and is advancing to the point where it can compete in the higher-volume territories of commercial offset printing.
Digital technology becomes a viable option for the newspaper industry
Given recent advances in digital technology, and changing requirements in the newspaper industry, it’s not surprising that the case is building for printing newspapers digitally. Océ, and other vendors have developed systems that are suitable for this very application. And, while digital printing platforms may not yet meet the productivity and cost requirements for producing large-circulation newspaper runs, there are significant opportunities in printing niche products and local and smaller circulation papers.
Certainly the newspaper industry faces significant challenges—dwindling readership and circulation, high costs, competition from alternate media like cable TV and the Internet. One way to address these issues is considering how digital printing technology can help newspapers generate new business and revenue streams. Digital technology offers unmatched flexibility for printing color on demand, without incurring the costs of additional plates, while enabling all content and advertising to be dynamic. What’s more, with digital technology, run length is less of an issue—print runs of one are as cost-effective as run lengths of 1,000.
Leveraging core strengths to create a new business model
Clearly, a perfect storm is gathering in the newspaper industry. The Internet has wrought havoc on publishers, weakening the underpinnings of the industry. Taking an “if-you-can’t beat-’em, join-em approach” many newspapers have successfully adopted Internet strategies and have been able to capture an increasing share of the Internet advertising spend. However, simply adding a web version of the paper isn’t enough to staunch the bleeding or halt the erosion in circulation and advertising.
Still, there is reason to be optimistic. Core strengths, like local knowledge, rich content, market research, advertising and distribution are significant competitive differentiators that newspapers can use to compete against other forms of media. However, publishers must find new ground: they must simultaneously embrace change and work to leverage these strengths while fundamentally transforming their businesses.
Surviving this period of transition requires developing strategies that move away from the broad-reach circulations dictated by underutilized fixed assets. Instead, newspapers must move towards desirable and relevant content products that deliver significantly higher performance to advertisers (higher margin as well). Obviously, this won’t happen overnight and most publishers won’t concede their broad-reach positions. However, at some time in the future, there will be an inflection point where broad-reach, highly rich and relevant content meets high-performance advertising. This is already occurring with electronic communications and will evolve in print as well.
Innovating new business models and working collaboratively with customers is a key element of the Océ business ethos. Our strengths in high-volume automated print manufacturing, expertise in data-intensive applications, and a fiercely customer-first culture, position us to partner with the newspaper industry to facilitate this transformation. In fact, Océ has been engaged with the newspaper industry all the way back to the turn of this century with the development of the Océ Digital Newspaper Network. Today, we are actively engaged in dialogues with major newspaper publishers to help them overcome the challenges they face, to explore new business models and opportunities by leveraging technology to change the way they do business. We look forward to continuing this path of innovation and transformation as today’s newspapers evolve into tomorrow’s highly personalized information delivery media.