Importance of Alliances
The alliances between the OEMs, printhead and ink makers will lead to alterations in the traditional supplier/customer relationships in printing. There could be radical changes in conventional roles in the marketplace.

“We’re having to develop new business models to tackle the needs of the newly emerging digital sectors in commercial printing,” said one marketing executive in the printing industry.

In the longer term, the trend toward collaboration in product development could accelerate the predicted revolution in printing stemming from the use of ink jet and roll-on-roll technologies for the manufacture of a new generation of electronic displays and identity (ID) tags.

Some OEMs, printhead specialists and ink companies are already involved in cooperative R&D projects aimed at providing materials for printable electronic products.

But a viable market for printable electronics could be as far as five to 10 years away. An ink jet market in packaging could start to take off in two years in Europe, possibly even sooner.

As a result, ink companies will be moving into new positions in the digital sector. There will also be opportunities for producers currently with small or non-existent ink-making operations.

U.K.-based Sericol has, for example, taken on a broader function in the wide format ink jet segment than it has in screen printing, in which it is a market leader in the supply of inks in Europe.

Through a marketing and development partnership with Inca Digital Printers, Cambridge, England, it is selling direct to printers not only its own digital UV inks but also printing machines for the wide format market.

Sericol is the worldwide distributor for Inca’s flatbed ink jet printers, serving mainly the segments for point-of-sale materials and outdoor displays.

The printers can handle displays as large as 3.2 x 1.6 meters on flexible and rigid substrates, some as much as 40 mm thick and with resolutions of up to 1,200 dpi. Sericol’s UV inks ensure quick drying, wide color gamuts and high lightfastness.

“The marketing of Inca’s machines has not been a big leap for us,” said Peter Kenehan, Sericol’s head of imaging. “We see ourselves as sellers of solutions. We have been selling ink dispensing systems for screen printing to enable printers to achieve accurate color matching. Also the first business of this company was the supply of screen printers, so the distribution of machines is part of our history.”

Sericol believes that even in the relatively mature wide format digital sector, it will be several years before the present partnership-oriented structure of the market – at least in the flatbed UV segment – will be undermined by third-party ink suppliers.

“A third-party after-market is already beginning to emerge for solvent inks in wide format,” said Mr. Kenehan. “But we believe that for the next three to five years, the only way to develop the segment we are in is through alliances between the equipment engineers, the printhead specialists and the ink producers. It’s the only way forward because there is no one who can develop and sell each component of the solution on its own.

“The wide format market is booming at the moment with double-digit annual growth and is probably the fastest growing ink jet printing market,” he added. “The ink jet process is only just at the beginning of its life so there will plenty of growth in the future.”

The Inca machines have been targeted to meet the demand of printers for cost-effective equipment for short runs of up to 100 copies.

Now with improvements in the quality of ink jet processes, the two partners are aiming to expand into the area of runs of more than 100, where digital should be highly cost competitive because of the elimination of the necessity for pre-press work.

For Sericol, this will mean bringing digital into the core of the screen printing market, on which it is dependent for most of its screen ink sales. Nonetheless, the company believes that for the foreseeable future it will still remain predominantly a screen printing inks supplier.

“Our digital inks are still complementary to our screen printing inks because they are confined to use for short runs,” said Mr. Kenehan. “As the output capacity of the ink jet machines increases, the digital inks will become an alternative to screen inks. This will not happen for a while yet. But the prospect of this has been the main driver behind our involvement in digital inks because it enables us to participate in the substitution process.”

Packaging Business
Sericol is beginning to target its digital inks at the packaging sector, where it feels ink jet will be able to exploit the cost advantages of absence of pre-press work and the reduction of stocks due to print-on-demand capabilities.

“Packaging is the Holy Grail for ink jet because it is such a big market,” said Mr. Kenehan. “We will be looking for small niches in which we can create a position for ourselves.”

Inca is creating separate partnerships to mount its own attack on the packaging sector, in which it is focusing initially on the corrugated board segment.

It has formed an alliance with Sun Chemical for the commercialization of a single-pass full color ink jet machine for the sheetfed corrugated market. Its array of print heads will cover a print width of 520 mm on substrates up to 700 mm wide and 7 mm thick. It will have a color resolution of 300 dpi and a speed of 100 meters per minute.

Inca chose Sun Chemical for both the development of the inks and the distribution of the machines, due for launch next year, because of its strong position as an ink supplier in the conventional sheetfed market. Sun Chemical’s distribution network was also crucial.

“Our strategy is to select partners which are well established in the sectors we are entering,” said Heather Kendle, Inca’s marketing director. “While Sericol is a suitable outlet for flatbed machines because of its position in screen inks, Sun is a better option for the marketing of the corrugated equipment. It sells a lot of ink to sheetfed printers, and printers are familiar with the company.”

Inca believes that it is not yet well known or big enough to sell its own machines directly to printers. It also believes that digital technologies will not penetrate deeply into packaging if printers have to deal with a multiplicity of suppliers.

“Digital equipment and consumables are coming from a variety of companies and countries, which potentially can be confusing for printers,” said Ms. Kendle. “If ink jet is to get into the mainstream of packaging, it will not be just about speed and cost levels. Logistics will be hugely important.”

OEMs are expected to turn out eventually to be the ones who will be doing most of the direct marketing of digital equipment and consumables to printers, possibly after a period of consolidation among machine manufacturers. They will have the resources to provide the technical backup for equipment with complex electronics and software. Hence it would appear only logical that they market the machines as well.

Such a system would suit ink makers that currently do not have much of a presence on the ground.

“The marketing and technical support will not be split between the machine manufacturers and the ink producers in the way it is in the conventional printing sector because it is not in the interests of the customer,” said Mr. Nicholds.

“The digital machine with its printheads and inks will be highly customized so that it will be offered to the printer as a package based on the total cost per impression,” he added. “The advantage of digital is in the value added, not the price of the consumables, so there will no requirement for direct marketing of inks.”

However, Avecia, a specialty chemicals company which has built up its expertise in digital inks through its knowledge of colorants chemistry, accepts that digital customers will expect it to be able to give technical advice although its name will not be familiar to printers.

“We are reviewing our system for technical support which already enables us to give printers a technical service,” said Mr. Nicholds. “We anticipate our technical support infrastructure will grow with the market.”

Avecia has alliances with Xaar, Cambridge, England, the printhead developer and manufacturer, and Dotrix, the Belgian-based maker of ink jet printers, which was recently taken over by Agfa, the Belgian imaging company.

Agfa itself formed a partnership with Xaar in March for the development and manufacture of a new generation of ink jet printheads. They will be made at a Xaar plant at Jarfalia, Sweden, in which Agfa is investing E2.5 million ($3 million).

With its own operations in 40 countries, 120 dealers worldwide and annual sales of approximately E4.2 billion, Agfa is an example of an OEM with substantial clout behind digital printing. But even it needs partners.