Digital color production printing: Market trends and dynamics

Digital color production printing: Market trends and dynamics

Biscos, Gilles

From the desktop to the corporate board room, color is increasingly perceived and used as an important and necessary dimension of business communications. According to HewlettPackard, over the past two years the market has evolved from a situation where users in corporations asked themselves, “Why do we need color?” to one where their key question has become, “How do I roll color out in my whole organization?” This evolution has been driven by improvements in technology (higher performance and reliability) and lower operating costs.

This article, based on excerpts of a recent study published by INTERQUEST, which analyzes key trends in digital color production printing.


INTERQUEST estimates that approximately 150,000 desktop color page printers were shipped in the United States in 1999-this is a 50% increase over 1999. This growth is a result of the intense price competition among vendors and a new generation of printers launched by HP and Canon at the end of 1998. In 1999 HP dominated the desktop color printer market, followed by Tektronix (which is now part of Xerox), Minolta/QMS, and Lexmark.


Major trends and developments in the desktop color page printer market include:

Consolidations such as Minolta/QMS and Xerox/Tektronix, who are making life increasingly difficult for smaller players;

Lower prices, and, in some cases, more features for about the same price (and in Tektronix’s case, free printers for selected businesses);

Increased demand for decentralized color printing;

Interest from the graphic arts sector following the arrival of high-quality Bsize full-bleed machines;

Improvements in performance, including: higher print speed and throughput, better print quality, enhanced paper handling and more finishing options, more powerful controllers, better color calibration and color management, improved ease of use, and lower cost per page.


Top industry sectors are manufacturing, banks and finance, insurance, and real estate where desktop color page printers are widely used by marketing, sales, and other departments involved in external communications. In corporations, PowerPoint presentations remain the top application, followed by on-demand reports and proposals, and sales.

Will desktop color page printers take over the low end of the copier/printer market? Advocates point out that desktop color lasers are simpler to use. Furthermore, the printer service model-with no click charge and user-replaceable components-will remain intact even as higher-performance machines with improved paper handling and electronic collation are developed. This combination of factors will ultimately kill off low-end copier/printers. There is compelling evidence that the market for color copiers is already moving upstream.


Within the next few months we sill see new faster tandem models (units which print the four colors in a single pass). We also expect to see a single-drum (multi-pass) PostScript desktop color laser priced at less than $1,000 within the next 6 months.


INTERQUEST estimates that approximately 35,000 color copiers were shipped in the United States in 1999-a 15% increase over 1998. Canon continues to lead the color copier/printer market but has lost ground to Xerox and Ricoh in the last few years.

Sales of entry-level copier/printers producing 6 ppm in color (21 to 28 ppm in monochrome) and mainly targeted at corporate office applications with monthly print volumes of 3,000 to 7,000 pages will experience a slow rate of growth over the next few years.

Sales of midrange color copier/printers producing between 7 and 15 ppm in color (28 to 50 ppm in monochrome) and generally used in appliations with a higher percentage of color coverage and higher monthly volumes (7,000 to 30,000 pages per month) are expected to grow at a 20-25%o rate over the next few years. This growth will be fueled by the increased use of color by corporations.

The high end segment (15+ ppm) is experiencing the highest rate of growth. INTERQUEST estimates that at the end of 1999, Xerox and Canon had a combined installation of more than 20,000 units worldwide. In the U.S., approximately half of these units have been installed in the print-for-pay market and the other half in corporate In-Plants and reprographics departments.


Key trends in the color copier/printer market include:

* Increase in copy/print volumes-the average monthly print volume per machine is growing.

* Higher percentage of connected machines-about 75% of all low-end midrange, and high-end color copiers are currently shipped as connected machines. The connectivity rate for high-end ranges from 90% to 95%.

* Low-end moving up in speed and quality-As mentioned earlier the encroachment of high-end desktop color lasers has caused many vendors of entrylevel copier/ printers to bump up the speed and quality of their devices.

* Closing speed/duty cycle gaps between high-end and midrange machinesIn the last 15 months, Canon launched the CLC-2400 (24 ppm) and Xerox announced the DocuColor 30 (30 ppm) which are positioned below the CLC-1000 and DocuColor 40, respectively. Toshiba introduced its aggressively-priced FC 22 (25 ppm) model.

* Improved reliability-the average call per month on low-end to midrange systems has dropped significantly over the last three years.

* Lower cost of operation-With the DocuColor 12 Xerox has initiated a move towards significant reduction in the cost of operation of midrange color copiers. * Dedicated office machines-Xerox recently confirmed its strategy to target the office market with slightly different models from those targeted at the graphic arts and print-for-pay markets (i.e. DocuColor 12 and Document Centre ColorSeries 50).

* New RIPS-EFI has unveiled two new Fiery controllers (its first based on Intel processors) to drive the new color copiers introduced by Canon, Ricoh, and Xerox in 1999.


Within the next 12 months we expect to see new midrange and high-end systems brought to the market by vendors such as Canon, Konica, and Minolta. For example, at its Dealer Digital Solutions Forum held in Phildelphia at the end of 1999, Canon demonstrated a faster version of its CLC-1000 and the Color imageRUNNER, a new unit that offers speeds of 21 ppm in color and monchrome mode with resolution of 600 x 600 dpi.

Leading vendors will continue filling the gaps between their 10 to 12 ppm midrange models and their 24 to 30 ppm models. A the upper end of the market, vendors will offer faster versions of their current high-end machines to furhter narrow the gap between color copier.printers and color digital presses. Xerox recently initiated such a move with the launch of the DocuColor 2045 (45 ppm) and DocuColor 2060 (60 ppm).

The popularity of clustered systems (based on T/R systems, AHT and KFI technology) will increase as color copier/printer vendors such as Canon, Ricoh, Toshiba, follow Minolta and Mita in offering this type of scaleable solution.

We also expect to see more in-line finishing solutions for both midrange and high-end systems as well as more variable data printing.


As of March 2000 there were approximately 8,800 digital presses and direct-to-press systems installed around the world. INTERQUEST expects unit shipments of full-color digital presses in the United States to grow at a 21% CAGR from 1998 to 2003. This is relatively modest growth compared to other segments of the market, particularly desktop color lasers and high-speed copiers.


Key trends in the digital press/direct-to-press market include: * Consolidation and partnerships-In the last 12 months Indigo announced parnterships with A.B. Dick, and Datacard, Xeikon acquired Nipson Printing Systems and Agfa’s Chromapress business, and announced alliances with Man Roland and Minolta. Heidelberg acquired Kodak’s Office Imaging Group

* Vendors push into the corporate market-in the last 12 months Xerox and IBM have been pushing their variable data printing solutions into the corporate market.

* Significant price reductions-in July 1999, Indigo launched the e-Print Pro+ priced at $149,000. This is $100,000 less than the e-Print Pro announced nine months earlier.

* New direct-to-press systems-Heidelberg began shipping the Speedmaster SM 74, its B2 system announced at IPEX’98, while several beta units of 74 Karat system have been installed worldwide.

* New cut-sheet digital presses-Xeikon recently launched its CSP 320 D model, the company’s first cut-sheet press that prints 960 letter-size duplexed pages per hour. As mentioned earlier, the new Xerox DocuColor 2060 which offers faster speed, enhanced print quality, higher reliablity, and lower cost per page than the DocuColor 40 can now be conisdered as a digital press competing head on with Xeikon and Indigo entry-level systems.


Color digital Dresses have been installed predominately at trade shoes. service bureaus. quick printers, and commercial printers. The penetration of color digital presses into corporations has been much slower. Short runs of documents with static content account for the bulk of today’s digital press business.

The printing of variable data and personalized documents, however, is making some progress. Variable data printing is seen by product marketers as an innovative way to differentiate their products. Digital press vendors view variable data printing as a way to capture longer print runs, primarily because they are no longer competing with offset printing on a cost-only basis.

Recent developments such as the Personalized Print Initiative, or PPI, to develop a software standard that would significantly improve the efficiency of the RIPing process in personalized printing applications, as well as approaches and techniques such as Varis’ VariScript are key enablers for variable data printing.

Labels and packaging are viewed as significant opportunities. Xeikon says its label printing business has been growing every quarter for the last two years. Indigo has been very active in this market with its Omnius press.


In the future we expect product improvements, lower prices, and lower cost of operation-the speed and print quality of digital presses will continue to improve, and a wider range of substrates will become available.

* Ultimately the use of personalization and variable data printing on digital presses will increase, fueled by one-to-one marketing, the Internet, success stories, easier implementation, and the outsourcing of database management.

* Offset equipment vendors and suppliers will continue to lower costs and further automate their systems to better compete with digital solutions in terms of price and turnaround time.

* Other press manufacturers will follow Heidelberg’s lead with the Speedmaster 74 DI in enabling customers to switch easily from conventional offset to digital offset.

* New players, such as Elcorsy, Goss Graphics, Barco, and Agfa/Xaar will enter the market.

* Ink jet technology will become a formidable competitor for electro-photography since it will offer similar or faster speed, lower cost per impression, and excellent print quality on a wide variety of media.

EDITOR’S NOTES: Gilles Biscos is president of INTERQUEST a market and technology research and consulting company in the field of electronic printing and publishing. Over the past ten years INTERQUEST has published numerous multi-client studies related to digital printing and print-on-demand.

Digital Color Production Printing: Market Trends and Dynamics, a 154page report, which includes over 50 full-color can be ordered by contacting INTERQUEST at 804/979-9945 or by visiting the company’s web site

In addition,INTERQUEST and Xplor International have recently released a companion report-Color Production Printing in Corporate Environments: Vendor and User Perspectives-based on in-depth surveys with 292 individuals from large and medium-sized corporations in North America, as well as open-ended interviews with executives from leading vendors of full-color production printing equipment.

Copyright B U S Publishing Group, Inc. May 2000

Provided by ProQuest Information and Learning Company. All rights Reserved