14 days of critical information to prepare your business for 2012.
BPIC: We’ve seen at least a couple of companies exit or all but exit the wide-format digital marketplace in 2011: Gerber stopped production of its flatbed units earlier this year. This past spring, Xerox announced it had stopped taking orders for its wide-format machines in the US and Canada. Any thoughts on these companies’ announcements, or maybe others I’ve neglected to mention here?
Art Wynne, BERTL: Xerox will continue to sell wide-format products in Europe and developing markets. Like many companies, Xerox has prioritized each of their investments, allocating research and development dollars to areas where it can deliver the best value to the marketplace. Canadian and US-based customers will continue to have access to service support, supplies, media, and parts from Xerox for their existing equipment for at least five years.
Tim Greene, InfoTrends: Both are good companies, but both are clearly moving in new directions, Gerber into other market segments and Xerox into document-oriented consulting and services. In fact, when we think about what each of these companies actually manufacture for the wide-format market there is a real question about what they could profitably bring to the marketplace. Even if they manufactured all of their products and employed all of their own IP, there is probably not enough scale in the wide-format business for these companies which really don’t have or aren’t commercializing enough of their own IP to capitalize on it with high enough margins to significantly contribute to their overall corporate profits.
Peter Mayhew, Lyra: Nobody likes to see businesses exit markets but sometimes it’s just time to move on. Both of these organizations made sound commercial decisions, with differing reasoning, as all businesses have to do at some time. Given the economic conditions driving the CAD market and Xerox North America’s role in it, the decision was not especially surprising. And we were all excited by the GerberCat’s differentiated approach to UV-curing, but differentiation alone is sometimes not enough in this competitive market segment.
Marco Boer, I.T. Strategies: The barriers to entry for creating a wide-format inkjet printer are lower than ever. The inkjet heads that are at the heart of these printers are easier to integrate than ever before as the inkjet head vendors are providing more of the pieces required to make those inkjet heads work properly and the knowledge of how to integrate those heads is disseminating widely as the skill levels grow. As a result, worldwide there are now more than 30 manufacturers offering UV flatbed printers. Many of those are only sold on a regional basis (such as just in the Czech Republic or Turkey), and there is the answer: It’s very costly to distribute, service, and support wide-format printer technology on a worldwide basis.
Dan Marx, SGIA: As an imaging technology, wide-format digital has been wholly and completely adopted in our industry segment, so the rapid growth of five years ago – which was really the tipping point for industry adoption – has passed. The industry is relatively saturated with digital equipment, and now we’re seeing expected contraction among equipment producers. There are and will be fewer players in this area as we move forward.
The Big Picture has assembled five of the marketplace’s most informed analysts and consultants and asked them to help you evaluate the wide-format industry. Each day over the next two weeks, we’ll post a new, critical question from The Big Picture with invaluable answers from our panel – all designed to help you ensure that your company charts its best course for a prosperous year ahead.
Our 2011 panel participants include: Marco Boer, consulting partner, I.T. Strategies (www.it-strategies.com); Tim Greene, director, visual communication technologies consulting service, InfoTrends (www.infotrends.com); Dan Marx, vice president, markets & technologies, SGIA (www.sgia.org); Peter Mayhew, director, Lyra Research Europe (www.lyra.com); and Art Wynne, president, Business Equipment Research and Test Laboratories (BERTL, www.bertl.com).
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