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‘We make things easy for traditional printers’

business Updated: Nov 08, 2007 00:37 IST
N Madhavan & Ruchi Hajela
N Madhavan & Ruchi Hajela
Hindustan Times
Highlight Story

Long known as the leading player for photocopier, Xerox Corporation has steadily evolved as a leader in colour-based printing and is a key player in digital printing, both as a maker of machines and a provider of services for the publishing and printing industries. In Delhi on a visit for industry exhibition IPEX last month, Ursula Burns, Xerox Corp’s President, spoke to Narayanan Madhavan and Ruchi Hajela on how Xerox and digital printing are changing the game. Excerpts:

What is the portfolio of products and services that Xerox offers?

We have four pieces of our strategy. The first plank to our strategy and the most visible to people is drive to ensure that we can offer colour document management and reproduction everywhere – we want to lead in colour. We will have colour systems that provide the best colour quality, at the best possible price, at the best easy of use. If you think about documents today, hard copy documents - over 90 per cent of those documents are printed in black and white. It’s kind of a strange thing because if you think about the world, nothing is in black and white but most documents are still reproduced in B&W. Why would that be so? It’s because colour is expensive, it was hard to use and when we did have colour in the past it didn’t look as good.

The second piece of the strategy is growing the digital printing market, what we call the New Business of Printing – it is to make more of that 400 billion dollars of revenue, that’s out there - make it more personal, make it more short run.

The third piece of the strategy is Services. It is a big piece of our strategy and is a fast growing piece as well. It is one that extends beyond Xerox machines into solutions. It is about working with enterprises to manage their print copy infrastructure, their documents and their content.

The fourth plan of our strategy is to offer solutions and value propositions to smaller and medium size businesses.

How will Xerox make all of this possible? It isn’t as easy as this?

I agree, it isn’t as easy. The biggest challenge we thought initially was competitors. We are fighting with HP and others for this market.

It turns out that the biggest challenge is developing the market. Making it easy for people who currently have traditional printing methodologies. Working with commercial printers who have offset presses or other presses, to develop a profitable business. They are wedded to the old way of doing business; they know how to operate that. They are safe in that environment; they are not safe in moving to a Just in Time, fast turnaround, personalized, business model. For the print providers, it is about how do we work with them to change their business model. We felt we would have to compete with Canon – they have a fast press, we have a fast press. We have less competition there. The biggest challenge therefore has not been competitors but that of developing the market.

What does it mean to the good old printer? What can they do now that they could not do before?

There is a whole new set of jobs that was not done before and is now possible. If you type the world personalization in the computer, you can see that everything can be personalized – from a coffee cup to an M&M (candy), including advertising promotions to you.

It allows people/printers to expand into a space that they would never able to expand before. Most books today are done in a very small number of dedicated book printing houses.

For example, McGrawHilll does books. But now a lot of books are done by these small printers. Why would they be able to do books when a big vendor does 100,000 books and more. The books they do are short run, like 5,000 or even 500 copies that were not economical in an offset press. So a whole lot of work now comes to digital printers. Because digital allows you to personalize, do short runs and have a fast turnaround in a cost effective way.

How much investment does one need for an entrepreneur to get into digital printing as compared to an old (offset) printing entrepreneur?

A traditional press runs in millions of dollars. A traditional 4-6 station press costs between 750,000 US dollars to a million US dollars.

For a digital press, you can go as low as $25,000 for a colour, light duty but very effective printing technology, all the way to $750,000 for a fully configured iGen3.

What is happening in India? How much of a legacy market do you have here?

There has been a leapfrog in the last couple of years, from predominant photocopying stocks two years ago to a situation where 90 per cent of what we sell is either a printer or multifunctional device. There has been a dramatic shift.