HP is not alone in its effort to sell a device that combines features of a printer with those of a printing press. NexPress, a joint venture of Kodak and German printing press giant Heidelberg, is also in the game. And Xerox, too, has spent a reported $1bn developing its iGen3 digital printing press. But no one has a significant head start; it's still early for all the new digital entrants. Xerox is just now selling its iGen3 in a few key markets, while NexPress said in April that it has sold only about 150 presses, with plans to sell "hundreds" by the end of this year. Joshi points out that HP is benefiting from Indigo's experience and is studying what is working for companies such as Image, a silicon print shop that has been using an Indigo machine for more than three years and has been profitable the entire time, according to chief executive officer Don Watson. Watson said his first customers had print runs too small to be economical on a traditional offset press. "If a customer only wanted 300 or 500...brochures for a specific event, they saw the Indigo as an option they'd never had before," Watson said. But despite some key advantages, HP faces a number of hurdles. First off, it's a new area for HP, with a new base of customers. While HP's large-format printers and plotters have been used by "pay for print" shops, Indigo's main customers are old-fashioned print shops, which tend to be small and medium-size businesses. Plus, workers in print shops are technically skilled, but in a far different area. "It poses more of a technical challenge to the shop that buys it," said Gott of Printer Market Monitor. "They have to come up to speed in the computer world, which they might not have done before". Another challenge is that Indigo's machines are very labour intensive. That's one of the reasons chain copy shops have declined to install them. "I don't think they employ people at that skill level," HP Labs' Hanson said. "This shouldn't have to be limited to a print shop". Image's Watson said running the Indigo does require somewhat different experience than traditional printing. While the machines don't need an experienced press operator, Watson said, they do need someone "more mechanically inclined and computer literate" than his typical worker. HP is not the only one struggling with that issue. Xerox, for example, sends a representative with its iGen3 machines, not just to operate and maintain the machine, but also to sell customers on the idea. "You don't have someone buy a $500,000 digital printer and not make any money," said IDC analyst Riley McNulty. "That's the last thing you want". Joshi agrees, saying that in addition to selling machines to print shops, HP has to make sure enough big companies know about the machines so that the print shops themselves can make money. HP is also working to make sure future generations of products using the Indigo technology operate more like the company's other printers, with much of the decision-making handled through software. Serving documents
Other company initiatives include a specialised server that could help create custom publications for smaller operations -- basically allowing a PowerPoint presentation to be professionally put together minutes before a meeting and customised for each person in the room. HP Labs is working on the machine, which will be built from standard PC components and contain special software that would automate the processes behind printing booklets, catalogues or digital photo albums -- such as converting images and text into PDF files. Information technology managers could slide the servers into an ordinary rack, similar to the kinds of specialised server appliances already on the market that are dedicated to tasks such as encryption, email or Web searches. "We're trying to take all of the nits and grits out of publishing and put it into a box," said HP's Sang. Publishing "is an art, but we should be moving away from that...You shouldn't have to know how to use Illustrator and Photoshop". Ideally, these servers would let sales teams graduate from handouts printed from PowerPoint slides. In a demonstration, Sang selected text, artwork and several slides from a drop-down menu. Minutes later, an 8.5-by-11, two-staple colour booklet was completed. Publishing servers would also let companies customise booklets on the fly and delay print jobs until the last minute. Although Sang said such documents are likely to be processed on a colour laser printer, such an approach could also be handled more professionally when used with an in-house Indigo press. Currently, these types of print jobs have to be outsourced, or left to an art department. Sang said it is unclear when or how HP might bring such a product to market. "The hardware is there, and some of the (software) technology is there. We're still working on the go-to-market strategy," he said. From books to bits
Hewlett-Packard is also probing opportunities in document preservation. In one massive project, HP digitised the entire MIT Press catalogue, a collection of publications that stretches back to the 1940s. The university, the fourth largest academic publisher, wanted to sell out-of-print books and reduce the burden of warehousing old textbooks, said John Burns, another worker in HP's labs. Although ostensibly a high-tech project, most of the expense involved scanning pages. The volumes were sent to Lason, a scanning services company. Workers in Mexico and Barbados were employed to cut out and scan each page, which took about a minute per page. In all, about 1.5 million pages from 2,200 books were digitised at a cost of about 30 cents a page, said Burns. Once the pages existed in electronic form, HP channelled the results through a workflow system, 18 computers and a storage unit. Some of the chief challenges involved devising algorithms to ensure that pages of the physical book corresponded to those of the electronic versions. Faulty scans, unusual chapter conventions and blank pages separating chapters often threw off the process. "You can't possibly have a person look at every page," said Burns. Because books now get published and stored electronically, there is likely a finite limit to the need for such services. Still, the number of analogue documents is staggering. The 2,200 books of the MIT collection took 2.5 months to process. The Library of Congress contains 20 million books. That's a lot of billing hours. And not all publishers have gone digital. "Even today there are publishers that don't keep electronic copies," Burns said. "We've had lots of interest from (other) universities." Coffee, tea and pages 1 through 3
Another growth area for HP is finding new ways for travellers to print their documents. HP already has two printers with short-range Bluetooth wireless connectivity built-in, allowing people to print email and attachments from their mobile phone or handheld, for example. The goal now, Joshi said, is getting those printers, as well as ones with longer range Wi-Fi connections, in public places, such as hotels, coffee shops and airports. One area to watch is HP's existing partnership with Starbucks and T-Mobile, which involves providing wireless Internet access at the coffee chain's outlets. Joshi said a natural extension of that deal would be for HP to offer printing. "That's the next step," he said. HP's research found that about two-thirds of people with mobile devices would like to print out some of the data they are carrying with them. The company estimates that it could get people to print 40 to 60 more pages a month if it had printers in the right places.
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