Kodak Chairman and Chief Executive Officer, Antonio M. Perez, met trade journalists at Kodak’s offices in Madrid in July. He has been in the business for more than 30 years, and has been the driving force behind the multinational company’s global shift from film to digital technology since he joined in 2003. During the interview, he shared his views on the industry’s new shape as it emerges from the downturn, what the future holds and why he is convinced that KODAK PROSPER Press has started a print revolution.
How hard has the downturn hit a global company like Kodak?
The downturn has hit everyone everywhere, and in very different ways. Our corporate strategy is helping us weather the storm, but the state of the economy certainly isn’t helping. From our point of view, we can talk about three areas: Asia Pacific, where growth is spectacular (we’re seeing a 25% jump in the Graphics Division); Europe, where there is no clear sense of when the recovery will take hold; and the USA, where there is a slight upswing resulting from an increase in productivity and demand.
As for our Graphics Communications Group, demand is rising and we’re selling more digital plates than last year. But we’re also under a lot of pressure on prices – which is not surprising when you have reduced demand and abundant supply. In a nutshell, the USA, Asia and a few European countries are growing. This year will be tough, but we anticipate it will continue to improve.
The latest IPEX seems to have confirmed that inkjet printing is set to replace offset systems. What are your thoughts on the subject?
Over the last 15 years, inkjet technology has built up a strong reputation in the industry in terms of printing speed, image quality, and substrate flexibility. However, most technical companies around the world have not fully embraced continuous inkjet technology because they believe it was impossible to modulate drop sizes small enough to get the quality needed to replace the offset systems in use today – or indeed to provide a faster and more productive technology than EPS printing.
Our PROSPER press, based on Kodak’s proprietary continuous inkjet technology, combines the best qualities of offset – photo quality, low cost per page, high speed, and substrate flexibility – with the ability of offering variable data printing.
So will KODAK PROSPER Presses, which use this technology, revolutionise the industry?
I am convinced that it will. The best characteristics of offset systems are that you can print huge numbers of pages per minute (4,000 ppm), get photo-quality for less than €0.01 per page), and print on almost any substrate. The downside is that you can’t get variable data printing. With KODAK PROSPER you can do all of the above. The electrophotographic printing technology on the market today can only print 100-150 pages per minute, each page costs about €0.06 to €0.09 to print, and is limited as far as type of substrate on which it can print. Again, with PROSPER presses you solve those issues.
KODAK PROSPER Presses use KODAK Stream inkjet technology, providing the basic characteristics you can get from offset printing: 4,000 pages per minute for €0.01 per page, photo quality, a wide choice of substrates, plus variable data printing. On the basis of these deliverables, we believe that many of the jobs currently undertaken using offset or laser printing will move to PROSPER Presses.
When did Kodak realise that this was the way to go?
Kodak developed Stream technology years ago. In 2003, we started to invest heavily in this technology to develop the PROSPER Press, which was introduced to the market this year. We were aware it would take a number of years to develop the technology and fine-tune it for the market – not only for direct-mail advertising and books, but also for packaging, textile, industrial and other printing jobs. This technology makes a lot of sense for a large number of applications.
We know we made the right decision. From the outset our strategy was focused at the intersection where digital imaging and materials science converge. We believe this is where we have an edge on most of our competitors.
Will the appearance of PROSPER on the market mean that offset will disappear?
The printing market is very large, with a large number of differentiated applications. We will see for years to come a hybrid environment, with several technologies sharing the market. With time, the most productive technologies, such as the PROSPER Press, will continue to gain share of jobs and applications. In parts of the world where there is rapid growth, companies will skip a few of the phases we went through in the West. In Asia, for example, we anticipate companies will leap from their existing, limited-capacity systems straight to the most current technology like KODAK PROSPER.
Workflows are as important as the system. How is Kodak helping users with this?
This industry desperately needs to increase its productivity. The best way to do that is to incorporate a unified workflow software system that will help them handle different jobs and different technologies working at the same time in the hybrid environment that I just described. In order to provide that unified workflow solution, we put together our in-house resources and know-how in color management with the acquisition of Creo. Together, we built a leading worldwide organization for commercial workflow solutions.
Helping our customers run their businesses more productively and profitably is what we care about most. This is why we’re committed to being a global provider that supports its customers in whatever way they need – and what they need is increased productivity.
TransPromo is the hot topic here in Spain these days, but it doesn’t seem to be getting off the ground. What’s your view on it?
TransPromo won’t work unless the data management mining side works. TransPromo is in its infancy and is taking its first steps. There are many companies out there dedicated to developing data mining programs that use a wide variety of profiles to support segmentation. We won’t be developing these programs. Instead, we will partner with the best solutions providers in the market.
In summary, what will the worldwide graphics industry look like when the downturn is finally over?
I’m very optimistic about the printing business. The economic muscle and purchasing power in the USA and Europe still is very large. But Asia’s sheer power and population – and in the printing business people numbers matter as much as academic levels and income – will kick-start the downturn into an upswing. Printing companies in the USA and Europe will have to re-organize and accept that the growth they will see in the future will not be the growth they enjoyed in the past in their own geographies.
Modern printing technology will also help overcome the perceived downsides of printed pages, such as longer turnaround times compared with the internet. People will be able to customise and print pages instantly. This will boost the value of the printed page, affording it a key role in hybrid media spend.
I’m convinced this industry has an exciting future ahead of it.
Mr. Antonio Perez biography
Since joining the company in April 2003, Kodak’s Chairman and Chief Executive Officer, Antonio M. Perez, has led the worldwide transformation of Kodak from a business based on film to one based primarily on digital technologies. In the past six years, Kodak introduced an array of disruptive new digital technologies and products for consumer and commercial applications that generated more than $6 billion in revenue in 2008.
Those include, among others, consumer inkjet printers, sensors for digital cameras and mobile phones, and dry labs for printing at retail, as well as high-volume digital production presses, digital controllers, workflow software solutions, and digital plates for commercial printing. The result is a new Kodak -- a company where digital products account for 70 percent of revenue, where higher gross margin commercial businesses account for 60 percent of revenue, and with a portfolio of cash-generating traditional businesses.
Mr. Perez brings to the task his experience from a 25-year career at Hewlett-Packard Company, where he was a corporate vice president and a member of the company’s Executive Council.
An American citizen born in Spain, Mr. Perez studied electronic engineering, marketing, and business in Spain and France. In 2009, he received an honorary doctorate degree from the University of Rochester.