Before you read this post, please kindly read
the first post I put up about HP’s wide-format PageWide print-technology
printers. That post immediately precedes
this one.
Further comments about HP’s “PageWide”
technology wide-format print systems, coming to the reprographics world in the
2nd half of 2015.
Disruptive Technology
HP’s
PageWide wide-format print systems will print color CAD prints at the same
speed that they print black & white CAD prints. (Since I watched a live demo, I can tell you
that the printer that generated the demo prints printed full-color posters at
the same speed it produced CAD prints.) HP’s
representatives said that HP’s PageWide printers will print faster than LED
printers and operate at less cost than LED printers. That’s
a very bold claim. But, if it proves to be true, HP’s PageWide
printers will completely disrupt the
reprographics marketplace.
More than one PageWide wide-format model
forthcoming
In the 2nd
half of 2015, HP said that it will introduce three to four different models of
PageWide systems. HP did not provide any
details beyond that. So, at this point,
one is left to speculate on how those models will differ from one another. About
two years ago, HP introduced its first small-format printers that use PageWide
print technology. A quick check on
the Internet reveals that there are two models, one that offers output at 55
pages per minute, another model that offers output at 70 pages per minute. Based on that, I think it would be reasonable
to speculate that, when HP begins taking orders for its new PageWide systems,
it will introduce one model with a very high speed and one with a somewhat
slower speed. And, I’m further
speculating that there will be multi-function systems (scanner and printer) and
printer-only systems (printer but no scanner.)
This sounds like a reasonable approach to me, for the very high-speed
model(s) will be the one(s) that reprographers acquire for their production
centers and the model(s) with a slower speed will be acquired by reprographers
(and by A/E/C firms) for “OnSite” (FM) service sites.
Order Freeze
In 1995, OCE
flew some 70 reprographers from the U.S. to The Netherlands to introduce the
U.S. reprographics community to the (what proved to be revolutionary) OCE
9800. At introduction, OCE pointed out
that it would not begin shipping the OCE 9800 until 8-9 months later. In the ensuing months, very few reprographers
placed orders for Xerox or KIP wide-format plotter/printer systems;
essentially, there was an industry-wide freeze, reprographers wanted to wait
and see – pricing of, and operating costs for, the OCE 9800. Simply speculation on my part, but I see the
same thing happening with the introduction of HP’s PageWide wide-format
systems. I would not be surprised, at
all, to see reprographers (and, A/E/C firms) hold back on orders for OCE/Canon
and KIP LED and Ink-Jet wide-format
printers and systems (and Ricoh and all other LED wide-format systems.) The next 12 month period could be very ugly
for those who make a living selling wide-format printers and multi-function
systems. And, if I were in the
reprographics business, I’d certainly not want to be replacing worn out systems
with “same old” systems until I had the opportunity to check out HP’s pricing
(and operating costs) for the new pagewide systems.
HP will distribute through its channel
partners
If you want
to be a meaningful player with this new technology, I’d suggest that you make
sure that you are one of HP’s channel partners or are tightly connected to one
of HP’s channel partners. You do not
want to miss out on the opportunity to acquire these new systems at the lowest
possible cost, and you will not want to lose out on the opportunity to be an
authorized reseller of these new systems, especially if your company is already
a reseller of wide-format print systems.
Outright Purchase vs. Contractual Acquisition
At the HP
DesignJet Production Premiere event, HP’s representatives explained that HP
will be working with its channel partners to allow for acquisition on a contractual
basis rather than acquisition only on an outright purchase basis. That sounds like a pay-for-usage plan,
similar to how many reprographers offer FM deals. A pay-for-usage plan typically bundles
together – in the per unit usage cost (“unit” being per sq ft or per sq meter)
– equipment, service (parts, repairs, maintenance), and ink consumables. I’ll be very interested to see what HP comes
up with. But, let me further say that,
if HP makes it very easy, very simple, for companies to acquire its new
PageWide systems, HP’s going to quickly take market-share lead in the
wide-format print system marketplace.
Current LED wide-format distributors and
dealers (including reprographers who are dealers for OCE and/or KIP wide-format
systems)
I’d suggest you
take a very hard look at your dealership business plan going forward. Make sure that you don’t get caught with
inventory you can’t sell!
Rethink how you will equip FM sites
Ever since
the first affordable, low-end color plotters were introduced to the
reprographics industry, A/E customers have been interested in having the
capability, in-house, of generating black & white CAD prints at relatively
fast speeds and having the capability of generating color CAD prints
when necessary. (Many also want to use
their wide-format color printers to produce poster-type prints for marketing
and presentations.) To satisfy this need
over the past 15 years (and perhaps longer), reprographers who offer FM
services have been installing two different wide-format devices at each FM
sites: an LED black & white print
system and an ink-jet color print system.
When HP begins shipping its new “PageWide” wide-format systems,
reprographers will need to install only one system at each FM site, an HP
PageWide system.
Do A/E/C firms want their documents printed
in Color instead of in Black & White?
A couple of
years ago, OCE distributed a white paper that essentially said that
construction documents printed in color reduce errors and save money. Users of CAD systems draw in layers, layers
are in different colors. A CAD file is
then converted to print in black & white.
The primary (and, I think, the only) reason why 90% of A/E drawings in
the U.S. are printed in black & white instead of all being printed in
color? Pricing. If prices for printing sets in color are
reduced to the point where they are little different from prices for printing
sets in black & white, I can’t see where customers won’t want all of their
sets printed in color. It won’t happen overnight, but this change
is almost certain to happen.
Resistance to Change
Even if HP’s
new PageWide systems prove to be breakthrough, game-changing technology, there’s
no guarantee that orders will be significant in numbers, at least during the
first year they are available. Many
years ago, around October 1981, Darris McCord introduced the remarkable Shacoh
920, the very first wide-format xerographic system that offered 36” wide output
(on plain bond paper, vellum or mylar).
Most reprographers already had Xerox 2080’s (which cost over $100,000)
and many reprographers operated engineering photographic labs, the latter
threatened by a 36” wide plain-paper output device. Orders were not significant the first year,
but, as one reprographer in each market area made the move to acquire a Shacoh
920, others had to follow. Orders the second year were significant;
reprographers who did not have / offer 36” wide xerographic output were at a
disadvantage to those who did have / offer 36” wide output. Let’s face it, today reprographers have
high-speed wide-format b/w print systems, and they have wide-format color
inkjet printers. Reprographers have
invested significant sums in their existing systems. Just because remarkable, game-changing
technology comes onto the market, doesn’t necessarily mean that there will be a
rush to acquire the new systems. But, if
no one in a market area makes the change, then that – resistance to change –
could open up that market to a new entrant who does adopt the new technology.
Costs and Prices and Margins
One of the
wisest (and most successful) people to ever grace our industry, Mohan
Chandramohan, wrote a booklet about “managing a successful transition from
analog to digital”. When new technology
comes to market, and, when that technology does or will eventually obsolete
then-existing technology, costs change, pricing models are upset and have to be
changed, and margins are affected (sometimes negatively, but sometimes
positively.) I do think that, when HP’s
wide-format PageWide systems hit the market in numbers, costs are going to
change, prices will eventually changed and margins will be impacted. When HP releases cost info, study that info
and plan accordingly.
Who/what is going to be affected by HP’s new
PageWide wide-format printers?
-Manufacturers
who’ve previously introduced Memjet-powered wide-format print systems (OCE, RT,
Xerox). All of the Memjet-powered models
are priced at over $100,000. If HP
prices its high-volume PageWide model at less than Memjet models are priced,
and, if the operating costs of the PageWide model are less than the operating
costs of Memjet models, HP is going to bludgeon the order books of those who
are selling Memjet models. Memjet print
technology has not yet proven itself to be highly reliable. But, HP has a very long track record of
manufacturing very reliable equipment.
All non-HP wide-format inkjet equipment
manufacturers; Over the past ten years, Canon has done a great job eroding HP’s
share of the wide-format (technical document) inkjet market. But, that may soon change – in HP’s
favor. HP’s wide-format PageWide
printers will print lightning fast compared to Canon’s current line-up of
inkjet printers. And, it may well be that the operating costs of HP’s PageWide
printers will be less than the operating costs of Canon’s wide-format inkjet
printers.
-KIP and OCE and Ricoh and all other
manufacturers who offer
LED wide-format black & white printers.
It could well be that HP’s wide-format PageWide printers will put a
severe kibosh on sales of any and all LED wide-format black & white
systems. (Are you old enough to remember
what a diazo printer did?)
-KIP’s
c7800. A high-volume, high-speed LED
color output system. We’ll have to wait
and see what HP does with pricing and operating costs for its PageWide print
systems, but, if they are low, KIP’s going to have trouble moving its c7800
systems.
-Reprographers. It’s going to be costly to acquire new
technology that, itself, may render obsolete existing equipment
investments. Reprographers who operate
FM’s will face the same issue.
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Thank you
for reading this post. Your comments are
invited.
Reprographics 101 