Economics still stymies potential - WAN-IFRA

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Digital Printing
February 2007
newspaper techniques
Charlotte Janischewski
Two new digital printing systems for newspaper printing caused a stir at IfraExpo 2006.
Publishers are eager and curious to utilise the benefits of the digital process, but the
reality is that speed and efficiency still impose limits.
Economics still stymies potential
Where do we stand today?
The printed newspaper – most media experts agree – will be with us for many years
to come.
However, it is not clear how it will
look in 10 or 20 years’ time. The Internet
and mobile-based offerings take serious
consideration of the trend towards individualisation among the population – surely
the newspaper will adapt. In the future, will
the general newspaper be replaced by a series of newspapers aimed at target audiences, oriented towards specific areas of
interest, age groups or even smaller geographical units? Will free newspapers, ePaper editions and download possibilities further hurt print circulations? Developments
such as these could benefit digital printing.
“At drupa 1995, KBA, together with
Scitex, showed an ink-jet imprinting unit
as a component of a conventional newspaper rotary press. It was thought at that time
that digital non-impact printing could
someday take over parts of the newspaper
as an integral component of newspaper
production,” says Ifra Research Director
Manfred Werfel. Clearly, that hasn’t happened. Were the expectations of digital
printing too great?
Arved Hübler, a professor at Chemnitz
Technical University in Germany, says: “It
is essential to define which expectations are
concerned. Technically, digital printing has
developed very well and offers nearly eve-
> The potential of digital printing
> Does digital printing offer an alternative to offset?
For specific market segments (e.g. serving areas outside of the core distribution
zone with small and smallest parts of the total circulation, down to single copies
on demand), digital printing is unbeatable in relation to customer service and
efficiency. However, it is unlikely to seriously compete with the offset process in
the foreseeable future. Then again, you should never say never!
> How interesting is digital printing to the advertising industry?
Advertising messages are usually aimed at precisely defined groups of readers.
Naturally, as a mass medium, the general interest newspaper is not designed for
this. By means of personalisation the digital process offers targeted advertising
without waste coverage. This would mean added value to the advertising client
and bring in new income (advertising dollars) to the newspaper.
> When will the personalised newspaper arrive?
Digital printing is predestined for this application, as each newspaper copy can
look different. From target audience-specific editions to the individually compiled newspaper – no problem for digital! Business models are being contemplated, but most newspapers do not yet have the corresponding customer relations management (CRM) systems in place and customer data that could be used
for this purpose.
> Can combined offset-digital solutions be realised in practice?
Technically, it would be no problem to combine a jacket section coming from the
offset press with a digitally printed local section by means of inserting. Whether
the production run could be completed within the given timeframe would have
to be calculated for each individual case. Hybrid-solutions, due to the different
production speeds, are not yet an option.
22
rything that is needed today for the discussed application scenarios in relation to
quality, flexibility and reliability.” However,
in his opinion, he says it is unlikely that
there will be any change in the cold fact
that digital printing is much more costly
than the conventional offset process before
2020, at the earliest.
Productivity versus flexibility
Although the digital process has been
implemented into the newspaper production environment, it was not specifically
developed for newspaper applications and
is (still) not optimised for it. In newspaper
printing, the top priority was to produce a
consistent print product on a mass scale
and within the shortest possible time; therefore the focus was put on maximum speed.
In contrast, with digital, which has its origins in the office sector, the aim was to produce many different single documents as
efficiently as possible. Consequently, there
are very different tasks and concepts concerned here. Simply exchanging the processes for these applications inevitably leads
to disappointing results on both sides.
Just how fast is digital?
The speed of the digital process has
increased dramatically, but it is still much
slower than offset printing. Why is that the
case? Does digital not equal progress, faster,
higher, further?
The explanation could be lengthy and
highly detailed (see the corresponding entries in Wikipedia on the Internet and the
accompanying diagrams), but a simple image can convey the principle more clearly:
You sign 100 invitations to a company anniversary and then another 100, but this
time you use a stamp – which is faster? The
signature by hand must be done anew each
time, whereas the stamp is a simple copy –
it is not the processing power of the computer that is the limiting factor here, but
natural physical laws (a more labour-intensive process also requires more time).
If it is only the web speeds that are
compared, offset printing, with 15 meters/
second, is six times faster than the fastest
ink-jet digital printer with at present 150
m/min (which is why digital/offset combi-
» www.ifra-nt.com
February 2007
newspaper techniques
Digital Printing
Charlotte Janischewski
Enter (Article Direct Link) numbers online
» Expert interviews with Prof. Arved Hübler, TU Chemnitz (3296);
Manfred Werfel, Ifra Research Director (3245)
» Digital printing suppliers: Interviews with Michaela Frisch, Océ (3325);
Robert Köckeis, Kodak Versamark (3342); David Owen, NewspaperDirect (3268)
nations are not worthy of consideration at
the present time). On top of this, it should
not be forgotten that an offset press prints
not just on one web (as a digital press does)
and one page on each side of the web (as a
digital press does), but in stand configuration (4x2) it can print two times four pages,
multiplied by the number of webs used.
What makes digital so costly?
The so-called “click charge” model is
the usual price model in digital printing (as
well as in photocopying, the core business
of some suppliers of digital printing systems). This use-dependent charge (per 1000
copies) covers the maintenance costs and is,
in a manner of speaking, calculated into the
selling price of the system.
The click charge is a thorn in the side
of the publishers, as it raises the per-item
production costs. Fortunately, manufacturers have now indicated their openness towards different price models that are appropriate to a commercial utilisation of the
systems. “Yes, we offer several models,”
says Robert Köckeis, marketing director for
the Kodak Versamark ink-jet division, “the
click charge, buy with separate maintenance (depending on the technical skills of
the user) or a mix of both. The advantage of
the click charge model is that the investment is not so great, and it is only the actual printing that is paid for.”
“We are very flexible in this respect
and open for everything,” says Michaela
Frisch, responsible for the newspaper sector
at Océ. “We are fully aware of the fact that
the newspaper sector is a very different
market. In the past, we have found flexible
approaches at other customers, and I am
convinced that we can do so also in the
newspaper area.”
The per item production costs therefore depend on the necessary level of investment for the selected system (about 1.3
million euros for the Océ VarioStream 9230;
about 4 million euros for the Kodak Versamark VX5000), the costs for consumables,
especially ink or toner (the latter considerably more expensive), the length of print
run/system utilisation, and the maintenance
contract model. Under the most favourable
conditions, the costs will be about 1 euro
per copy. With offset, production costs are
estimated at 20-25 cents (depending on
wage costs), i.e. maximum a fourth the cost
of digital (see Ifra Special Report 3.37).
Expert opinion
Prof. Arved Hübler
newspaper techniques:
What is conceivable in
the future in relation to
the speed of digital
printing?
A. Hübler (Technical University Chemnitz): A
main technical problem experienced with the inkjet processes, as yet unresolved, is the reliability of the heads that very
frequently become blocked and must
be cleaned. For this reason, highspeed production with high resolutions and acceptable quality is problematical. The head manufacturers,
e.g. Xaar, have developed interesting
concepts here. When the high-speed
heads in the future become low-cost,
but high-precision serial products
costing just a few euros rather than
hundreds of euros, then it will be possible to rapidly and dramatically increase throughput with ink-jet printing by massive parallelising operation.
... Laser printing technologies also
have a major potential to increase
printing speeds.
Old and new business models
Today, three main business models
are used:
> Decentralised production of small
print runs to be able to offer the newspaper
on day A.
The advantages of “Distribute & Print”
(first distribute, then print digitally on location) lie in the time saved and economised
transport costs, which are felt mostly only
with small print runs and long distances.
Full interview online (Link: 3296)
Continued on page 26
The electrophotographic (left) and continuous ink-jet (right) processes
To the fixing station
Transfer station
Paper web
Discharge corotron
(AC-Corona)
con
duct or
Charging
electrode
Discharge lamp
d
Nozzle
Charge corotron
Drop
collector
Developer station
Pump
LED character
generator
Toner
Drop
deflector
Cleaning unit
m
Ph
to
Piezo
oscillator
ru
o
Transfer corotron
Imaging signal
Waste toner
Control
Paper
Ink
Potential sensor
Source: H. Kipphan, Handbuch der Printmedien
23
» www.ifra-nt.com
Digital Printing
February 2007
newspaper techniques
Charlotte Janischewski
Enter (Article Direct LInk) online
» Interview with Richard Boulton, Financial Times (3338)
Financial Times: Digital printing is one of many channels
The Financial Times completely outsourced its
production years ago. It
is produced today at 24
locations worldwide – by
the offset process. Four
years ago, it started to
Richard Boulton produce part of a print
run, consisting of several
hundred copies, digitally in South Africa,
but reverted to offset for cost reasons in
2005. Now the company is using NewspaperDirect’s digital network. In this edited interview, Operations Director Richard Boulton says FT’s digital product is
just one way to market its content to its
international audience.
newspaper techniques: What can you tell us
about the costs of digital printing?
Richard Boulton: I think there are four keys
to the digital printing of newspapers.
They are product size, cost, colour and
speed. Of these, the primary one is price
point, much of it depending on the economics of offset printing locally. With
digital printing, the cost is pretty much
the same anywhere since the local economics don’t actually factor that much in
the overall cost. If you install a digital
machine in South Africa, the costs are not
that different to the same machine in New
York or Barcelona or wherever. However,
in the offset world, there is a higher proportion of labour in the cost and so there
can be a vast difference between the cost
of printing a newspaper in, say, Tokyo, as
opposed to Johannesburg. In Johannesburg, by moving to offset, we were able
to halve our costs and, at the same time,
produce four times the number of copies.
(...) We would need the cost to be around
40 (euro) cents per copy to make it worthwhile.
Continued from page 23
According to Océ, about 15 titles “with
thousands of newspaper copies daily” are
produced at seven print locations on four
continents via the DNN (Digital Newspaper
Network) that was created six years ago.
Also, SatelliteNewspapers (formerly
PEPC Worldwide) is planning to build up a
network in which Kodak Versamark systems, among others, will be used.
> Financial and business news as a
service for business travellers in airplanes
and trains. After Handelsblatt News am
Abend in Germany (printed on Océ) cooperated for some time with Lufthansa, it is
changing to Air Berlin, and the new SZ
Primetime (Xerox) is signing up with
Lufthansa (Link: 3343).
> Print-on-demand: single copies from
automatic printing systems in hotels, at important traffic junctions or on cruise ships.
Hundreds of newspaper titles are offered today worldwide as “Print-on-Demand” copies via partner companies, such
as NewspaperDirect and SatelliteNewspapers. (Alternatively, there is the possibility
to download PDFs from the Internet, an option that is becoming increasingly popular.)
As David Owen of NewspaperDirect says,
the print-on-demand model has the advan-
Premiere 2006: Océ presented VarioStream 9230 for
newspaper production with up to three colours and
structuring in sections at IfraExpo 2006. According to
Océ, this is the fastest electrophotographic full-colour
printer on the market. The Hunkeler inline finishing
system is connected via communication interface. It is
Océ’s stated aim to introduce an extension to the
VS9000 family of products every year.
tage for publishing houses that they do not
enter into any risk and receive royalties for
sold newspapers. On the other hand, they
are totally dependent from their partners in
relation to sales and pricing. Even though
many hundreds of thousands of copies are
sold monthly worldwide in this way – the
sales figures for the individual newspaper
are almost negligible. The main consideration here is customer service and image
promotion.
26
nt: You have been promoting this idea for some
time to make the economics of digital printing
more realistic. Why hasn’t this happened?
R. Boulton: I think it is an issue of scale.
One of the problems is that newspaper
circulations, at least in the U.K., are relatively large. If you have somebody dealing with, say, 700,000 copies a day, printing 300 copies in city X in, say, Estonia, it
does not appear on their radar. We are all
resource constrained, so the circulation
guy more naturally migrates to managing
a wholesaler who is taking 20,000 copies
a day than spending his time thinking
about how to produce 100 or 200 copies.
However, I do believe that there is a good
business opportunity if someone was prepared to go down the outsourcing route,
taking care of all the international part of
the business for a number of newspapers
using web-based digital machines.
Full interview online (Link: 3338)
Many ideas exist for possible applications of digital printing in the newspaper
area (see also scenarios on pages 24 and
25). With regard to the economic aspects,
the new business models for publishers currently under discussion focus on the areas
of microzoning (geographical) and individualisation (demographic). The basic idea of
both models is that the digitally printed
product complements the traditional newspaper rather than replaces it.
The personal newspaper
Since each page under the so-called
non-impact printing process (without plate)
must be produced anew for the print-out, a
logical next step would be to adapt the content to the individual reader. But how much
sense would the individual newspaper
make? On the one hand, it would allow a
publisher to truly fulfil the personal interest
profile of the individual readers, but on the
other hand this would also mean a “filtering” process of the information, i.e. a type
of self-censorship. Is that what the newspaper reader really wants: no surprises?
A second aspect concerns costs:
Would the reader be willing to pay for this
service? Or what would it be worth to the
advertiser to be able to address his target
» www.ifra-nt.com
February 2007
newspaper techniques
Digital Printing
Charlotte Janischewski
Enter (Article Direct Link) numbers online
» Interviews with Gregor Dorsch, PersonalNews (3322)
and Prof. D. Schoder, improo (3267)
» Interview with Klaus Schmidt, KBA (3326)
audience directly? One-to-one marketing in
the newspaper – that would indeed be highly attractive for the advertising industry
and lucrative for the publishing house.
The idea is sufficiently appealing to
give rise to various concepts:
> PersonalNews: Gregor Dorsch, Syntops director, describes his business idea as
follows: “PersonalNews enables the customer to compile his own individual newspaper from the pages and sections of international newspaper titles. (...) The product
is then digitally printed and delivered to the
customer by 7 a.m. on the same day via the
regular newspaper delivery channels.” A pilot test involving about 20 newspapers from
various countries has been announced for
mid-2007. Dorsch says The Washington
Post and Washington Times have expressed
their desire to participate. He says he does
not wish to announce other newspapers because of ongoing discussions (Link: 3322).
> improo: Detlef Schoder, a professor at
Cologne University, describes his concept of
an individual cross-media product as a
“synthesis between the online and offline
world.” The texts should come from a wide
range of sources, including newspapers,
agencies, etc., supplemented by dynamic elements from the Internet (RSS feeds, blogs,
etc.). The software that is necessary for a
completely automatic production process is
self-learning and based on a proprietary
development. Schoder says improo will be
available sometime this year within the
framework of a market test to a selected
group of subscribers. Cooperation partners
are being sought (Link: 3267).
> MyObserver, an individual, digitally
printed add-on product to the U.S. daily
newspaper Charlotte Observer (see box on
page 28), is already in the middle of a market test phase.
Also aimed in this direction – though
intended for use exclusively with internal
New products shown at IfraExpo 2006: With a
hitherto unachieved web speed of 150 m/min, the new
Kodak Versamark VX5000 produced various newspaper
titles by the digital printing process, in full colour in
some cases. Jean-Luc Renaud (photo), technical
director of Républicain Lorrain in Metz, France, checks
a copy of his newspaper that was printed by the inkjet process on this press during the exhibition.
Renaud: “We are holding discussions about this with
the technical managers of other regional newspapers
and are of the opinion that the best approach would
be for several newspapers to cooperate and produce
their print runs for Paris on such presses. This is still
only an idea, because no official framework exists as
yet for this type of project. (...) At present we print
about 200 copies that are delivered daily by car to
Paris to serve specific distributors and political offices
(for example, free availability in the National
Assembly). (...) If we succeeded in utilising the
capacities of this press around the clock, we could
lower the costs to 25 cents per copy. That is still twoand-a-half times as much as for offset, but then we
would have no transport costs...”
I could imagine combined
offset/inkjet solutions in five
or 10 years – under certain
conditions.
»
Klaus Schmidt
Vice President / Director Marketing, KBA
publishing house data stocks – is a product
that is being conducted by Océ for a German regional newspaper. Océ’s Frisch does
not yet wish to name the paper concerned,
but provides details of the project: The offer
for the reader is designed as an individual
supplement to his subscription newspaper.
(read the interview online, Link: 3325.)
According to Franz Schwarz, head of
the digital media services division at the
Schwäbische Post in Germany, the targeted
distribution, among other things, is what
Interview with Jean-Luc Renaud (Link: 3339)
Swiss Post Office offers one-stop printing and distribution service
In mid-September 2006,
PostMail, a business division of the Swiss Post Office, started a new service: one-stop newspaper
production and distribuA. Hugentobler
tion. L’Agefi, the Frenchlanguage business newspaper from western Switzerland, is the
first customer. Acting as a partner to the
Post Office on the production side is Edubook in Merenschwand (in the Zurich region), a digital printer that also prints
books on demand on the same press.
“With L’Agefi, we have an ideal pilot
customer who wants to optimise his logistics. Up to now, due to a shortage of time,
the publishing house was unable to supply
readers in the Tessin region as well as in
eastern Switzerland with their daily newspaper on the same day of publication.
With digital newspaper printing, subscribers now receive their newspaper already
by 7.30 h,” explains Alfred Hugentobler,
head of the print media market segment at
PostMail.
The process for the newspaper publishing house is very simple, as it has only
one interface: after transfer of the PDF file
to the FTP server of the printing plant, the
Post Office assumes responsibility. Using
the PDF Mergebox developed by Océ, the
supplied files are automatically imposed in
the correct final format, says Christoph
Gfeller, product manager print media.
Addressing is done in the same print run.
At present, starting at 23.30 h, 300 newspaper copies per night are printed (in about
one hour) on an Océ VarioStream 9230,
folded on a MBO folding system and then
addressed. A carrier collects the bundles at
about 02.00 h. After that, the newspapers
reach the readers through the mail distribution channels.
As A. Hugentobler says, this model
could also be of value for publishers in
other countries working with cost-intensive logistics and who are practically unable to guarantee delivery on Day A.
More details online (Link: 3323).
27
» www.ifra-nt.com
Digital Printing
February 2007
newspaper techniques
Charlotte Janischewski
Enter (Article Direct Link) numbers online
» New York Times printing digitally in London (3337)
» Interview with Peter Vandevanter, The Charlotte Observer (3324)
prevents the wide-scale application of digital. He says it makes little sense to generate
a personalised product via databases, digitally print and then distribute it. “Such individual newspapers will undoubtedly be distributed electronically and printed out on
location by the customer as required.”
flights with suitable daily newspapers – using flight timetables to estimate the expected requirements (Link: 3327).
Publishing houses, together
with international distribution organisations, should
develop distribution concepts
in which digital printing plays
a precisely defined role.
New, practice-oriented methods
Hirschel computer publishing GmbH
in Munich, Germany, prints newspapers for
several publishing houses on a toner-based
Océ duplex sheet-fed press in the A3 format
(in cooperation with NewspaperDirect). After various unsuccessful attempts to do
business with hotels, at the end of 2006
Michael Hirschel decided to move his operation to the airport to supply international
»
Manfred Werfel, Ifra
ing and distribution from a single source.
Since September, a part of the circulation of
the business title L’Agefi for Tessin has been
produced and distributed under the direction of PostMail. Alain Fabarez, CEO of the
Agefi group, says, “With this move, Agefi
emphasises its policy of achieving growth
by availing of latest technological trends.”
Before this development, the paper was not
delivered on the day of publication in the
respective region, which is thought to have
motivated many readers to cancel their subscriptions (see also box on page 27).
Economic efficiency decides
Also of interest is a new service provided by the Swiss Post Office (PostMail division), which now offers newspaper print-
My Observer – personalised premium edition
“Direct marketing on steroids,” is how
Peter Vandevanter, former vice president
of new ventures for The Charlotte Observer in Charlotte, N.C., U.S.A., describes
the company’s “My Observer” personalised newspaper project (Vandevanter recently moved to MediaNews Group in
Denver, Colorado, where he will serve as
VP/ Targeted Products).
Essentially, The Observer
is testing the waters for
personalised printing, as
it has 24 of its subscribers
receiving a one-page
(two-sided) personalised
edition wrapped around
their home-delivered daily paper. It features topics
that they have preselected, as well as targeted ads.
It is considered a “premium service,” Vandevanter says, but will be free
for subscribers. He says this is about
added value, and that the advertising
should be such an easy sale that he
knows it will be profitable. “It costs us
about 25 cents to print that glossy page
and 25 cents to deliver it, so if we get a
dollar for an ad on the front and a dollar
for an ad on the back, we’re profitable.
… But,” he adds, “until we have about
1000 people using this, we probably
won’t try to sell the advertising because,
obviously, you need enough to make it
worth people’s while.”
Although it is a pilot project, he
says “it’s a real project; we have revenue
in the budget for summer 2007, so we
have to hit that.” The goal is to sign up 5
percent of the paper’s circulation (10,000
readers). Vandevanter says more than
that would create logistical delivery problems.
Here is how it
works: The source for
the personalised paper is
a designated website
where subscribers first
visit to answer 13 questions so the paper can
gauge interests, i.e. business, sports, politics, etc.
For each answer, an RSS feed is assigned,
already created from The Observer (other
blogs, etc.), or users can create their own
RSS feeds. At that point, the software
sends the feeds to a pagination program
and it is formatted onto a page (some
minor manual intervention). Once the
PDF is generated, it is then printed on a
Xerox 6060 digital printer as a threequarters-sized, two-sided broadsheet
page (on glossy paper), wrapped around
the daily and delivered. Subscribers can
also view their edition online.
Full interview online (Link: 3324)
In June 2005, The New York Times
launched a digitally printed edition in London. According to Raymond Pearce, vice
president circulation fulfilment, this step
did not represent a major venture from the
strategy point of view. “It was simply
cheaper and faster to print the small European circulation in London instead of flying the copies over from the U.S.A,” he
says. (Link: 3337)
Financial Times – alongside Børsen
(Denmark), Börsenzeitung and Süddeutsche
Zeitung (Germany) and Neue Zürcher Zeitung (Switzerland) – is one of the pioneers
of newspaper digital printing. In 2002, FT
began to print several hundred copies by
the digital process in Johannesburg, South
Africa. However, in 2005, when the circulation rose to 2500 copies, it went back to
offset. “In a manner of speaking, digital
printing was a victim of its own success,”
says Operations Director Richard Boulton.
The experience in South Africa showed that
digital printing is a viable way to enter and
develop a market, and then to change to the
lower-cost production process after a corresponding level of circulation has been
reached (see also box on page 26).
Technology will continue to bring improvements that, should the new developments indicated by Hübler actually materialise, could cause a major leap in
productivity. This would then create new
conditions in relation to additional possible
areas of application. Someday – perhaps in
20 years’ time – digital printing could compete with offset. But who knows how the
newspaper will look then?
Ifra correspondents Caryl Holland, Martin and Cecilia
Campbell, Christian Pradel (graphic) contributed to this
article, as did Dean Roper and Valérie Arnould from the
newspaper techniques editorial team.
28