Analysis: Dutch digital firm tackles change with powerful parent and colourful ideas

Barney Cox
Friday, February 4, 2011

Having bolstered its presence in its traditional markets, Oc is setting its sights further afield, says Barney Cox

Océ has been the market leader in monochrome continuous feed toner printers producing direct mail and transactional applications for many years. That market is now undergoing a rapid change as those core applications migrate from monochrome to colour, the technology switches from toner to inkjet and new applications emerge for high-volume colour.

For Océ to maintain a leading position alone was going to be tricky, R&D funding and a sales channel that could support its ambition don’t come cheap, so its acquisition by Canon is seen as a win-win. With Océ part of the Canon portfolio, the Japanese imaging giant has been catapulted to the head of a sector it previously had no exposure to.

In the past it appeared that rivals such as Xerox, Kodak and HP were happy to let Océ enjoy its niche while they focused on cut-sheet toner technology. But as the digital market grows there is a demand for full colour faster, in much higher volumes, and at lower cost.

"Since Drupa 2008 we, and other vendors, introduced inkjet machines with good quality at 10 times the speed of the cut-sheet toner machines. Once you can print 20-30m pages per month, the costs around the machine come down," says Océ Production Printing executive vice president Sebastian Landesberger.

The figures speak for themselves: page costs are 1/8 of toner while the running costs – machine, manpower space and energy – can be an order of magnitude lower. Today’s market for continuous-feed digital machines is estimated at 10,000 engines at 5,500 sites, of which the majority will be replaced by colour. Océ hopes that its market share will ensure it picks up a significant volume of those replacement machines.

Further opportunities
There is another market in Océ’s sights: graphic arts. "For us, the positive side in graphic arts is that run lengths are coming down, and therefore the market is coming to us," says Landesberger. It’s not just customers but other suppliers too; witness the recent deal with Manroland, which will sell Océ machines. In that context, it’s easy to see why the firms want to come together. Océ is synonymous with digital continuous feed, while Manroland has a similar position in commercial and publication web offset – the very graphic arts market Océ believes is the natural next adopter of its products.

Océ’s expertise in the continuous-feed market is deeper than many rivals, and even predates the Production Printing division’s acquisition by the firm 15 years ago. Previously, it was the printing business of Siemens, which also explains its location in Bavaria rather than Holland, Océ’s homeland. With a previous acquisition and integration under his belt, Landesberger is confident that becoming part of Canon will be as successful. While all the talk of the migration from toner to inkjet and mono to colour tends to focus on printers, Océ believes its aces are workflow and understanding the applications.

"With inkjet technology, lots of vendors can build a machine but we can offer the total package – application design, training, business consultancy, service and workflow," says Landesberger. "It’s about the integration with the data stream, including the security and integrity of the documents and no leaking of customer information." In the light of well-known financial services brands, including Santander, HMRC and Skipton Building Society, mixing up customer details in recent "printing errors", the importance of that integrity is easy to see.

"Our controller technology gives us a lot of strengths," says Landesberger. "We think this is the difference and we have shown this for 30 years to banks and insurance companies."

One thing is notably absent in Océ’s vision for the market: transpromo. "I’ve always said that it will come, but that it is not the first market sector," says Landesberger. "It’s a complex application and you need to get board-level approval from the customer’s side to re-engineer the existing set-ups."

Its success to date would suggest that there is plenty of demand out there to keep Océ busy before it needs to address transpromo but its knowledge of the market and the security of its new ownership mean it will be well placed when the time is right.

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