Kodak Rolls Out NexPress SE · PDF fileKodak Rolls Out NexPress SE Platform Authors ......

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Headquarters: Europe: Asia: 97 Libbey Industrial Parkway 3 rd Floor, Sceptre House Hiroo Office Building Suite 300 7-9 Castle Street 1-3-18 Hiroo, Shibuya-ku Weymouth, MA 02189 Luton, Bedfordshire Tokyo 150-0012 United States United Kingdom, LU1 3AJ Japan +1 781 616 2100 +44 1582 400120 +81 3 5475 2663 [email protected] [email protected] [email protected] September 10, 2009 Analysis Kodak Rolls Out NexPress SE Platform Authors Jim Hamilton Published by On Demand Printing & Publishing Consulting Service © 2009 InfoTrends, Inc. www.infotrends.com Abstract Kodak has announced a new platform for its next generation of NexPress products. Called SE, the platform offers improved quality and productivity through three new developments: a quality improvement process called the Intelligent Calibration System (ICS), quality and uptime improvements through next generation consumables and image development, and an advanced front-end using Adobe’s PDF Print Engine 2. The new offerings based on the SE platform are called the NexPress SE2500, the NexPress SE3000, and the top-of-the-line 120 ipm NexPress SE3600. Except for the original NexPress 2100 (and remanufactured models thereof), earlier versions of NexPress products will be upgradeable to the SE platform. The first of the SE products to reach the market was the NexPress SE 3600, which became available at the end of July. The 120 ppm upgrade also became available at the same time. For More Information If you would like to order extra copies of this report, receive permission to use any part of the report, or be informed of upcoming market updates, reports, and related projects, please email us at [email protected] .

Transcript of Kodak Rolls Out NexPress SE · PDF fileKodak Rolls Out NexPress SE Platform Authors ......

Page 1: Kodak Rolls Out NexPress SE  · PDF fileKodak Rolls Out NexPress SE Platform Authors ... NexPress Product Line Overview ... 3 Adobe PDF Print Engine was introduced at IPEX in 2006

Headquarters: Europe: Asia: 97 Libbey Industrial Parkway 3

rd Floor, Sceptre House Hiroo Office Building

Suite 300 7-9 Castle Street 1-3-18 Hiroo, Shibuya-ku Weymouth, MA 02189 Luton, Bedfordshire Tokyo 150-0012 United States United Kingdom, LU1 3AJ Japan +1 781 616 2100 +44 1582 400120 +81 3 5475 2663 [email protected] [email protected] [email protected]

September 10, 2009 Analysis

Kodak Rolls Out NexPress SE Platform

Authors

Jim Hamilton

Published by

On Demand Printing &

Publishing Consulting Service

© 2009 InfoTrends, Inc.

www.infotrends.com

Abstract

Kodak has announced a new platform for its next generation of

NexPress products. Called SE, the platform offers improved quality and

productivity through three new developments: a quality improvement

process called the Intelligent Calibration System (ICS), quality and

uptime improvements through next generation consumables and image

development, and an advanced front-end using Adobe’s PDF Print

Engine 2. The new offerings based on the SE platform are called the

NexPress SE2500, the NexPress SE3000, and the top-of-the-line 120

ipm NexPress SE3600. Except for the original NexPress 2100 (and

remanufactured models thereof), earlier versions of NexPress products

will be upgradeable to the SE platform. The first of the SE products to

reach the market was the NexPress SE 3600, which became available

at the end of July. The 120 ppm upgrade also became available at the

same time.

For More Information

If you would like to order extra copies of this report, receive permission to use any part of the

report, or be informed of upcoming market updates, reports, and related projects, please email

us at [email protected].

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Table of Contents

Introduction ............................................................................................................................... 2

About the NexPress SE Platform ............................................................................................. 2 Intelligent Calibration System ................................................................................................................. 2 Enhanced Dry Inks, Developers, and Dry Ink Stations .......................................................................... 4 System Software v11 .............................................................................................................................. 4

Kodak’s NexPress SE Positioning ........................................................................................... 5

The New Look ............................................................................................................................ 6

NexPress Product Line Overview ............................................................................................ 7 Upgradability ........................................................................................................................................... 8 Options ................................................................................................................................................... 9 The Fifth Imaging Unit ............................................................................................................................ 9 Environmental Advantages ................................................................................................................... 11

Fully Burdened Cost to Print .................................................................................................. 11

Competition ............................................................................................................................. 12

Strengths, Weaknesses, Opportunities, and Threats (SWOT) ............................................. 14

Conclusion .............................................................................................................................. 14

Introduction

Announced at the Media Days event in June, Kodak’s NexPress SE platform brings improved features

and a new look to the NexPress line. In this analysis, InfoTrends will explore the characteristics of the

new platform and its implications for the NexPress product line.

About the NexPress SE Platform

The new SE platform will include the SE2500, SE3000, and SE3600. The older products, except for

original or refurbished NexPress 2100 units, will be upgradeable to the SE platform. The look is new (see

images below) but underneath the new skins, the platform is driven by three innovations: Intelligent

Calibration System (ICS); NexPress SE Platform Enhanced Dry Inks, Developers, and Dry Ink Stations;

and System Software v11. These are discussed in greater detail below.

Intelligent Calibration System

Kodak’s Intelligent Calibration System (ICS) has been designed to improve image quality and increase

operator productivity. ICS uses a four-page CMYK print target that is scanned offline using the Kodak

ICS i1220 scanner to measure density. The ICS software then adjusts the system based on the information

recorded by the scanner. After recalibration, a validation print target is printed to confirm the correction.

The process takes a total of less than five minutes. Kodak says that 75% of the image quality problems

related to parts wear can be addressed by ICS. Previously an operator might choose to change all worn

parts when a problem occurred. Therefore, operator use of ICS should prevent early replacement of parts.

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Kodak also claims that ICS will provide a 10% to 15% improvement in labor savings, or alternately create

extra capacity that will give the customer $10,000 to $15,000 in extra margin per year.

Figure 1: The ICS black print target1 (there are targets for each of the four colors)

Kodak chose to implement ICS using an off-line scanner for a three reasons: (1) it wanted to make this

capability available to all customers in the field with no hardware changes or disruption to their

operations; (2) ICS takes into account the final printed piece on the actual substrate (not just some patch

on an imaging drum inside the device); and (3) Kodak expects that there will be a stream of other

improvements that will be made possible with this scanner, such as intelligent diagnostics. In addition, the

NexPress already has internal systems that assess system stability and manage process control. ICS works

in addition to these systems by assessing the final result on the printed page.

Kodak has beta tested the system in more than 150 locations and reports that users are extremely pleased.

One NexPress operator described it as “the single greatest improvement I have seen.” Kodak envisions

that the ICS test will typically be run on a daily or shift start basis. It may also be done as part of

maintenance, problem diagnosis, or as preventative maintenance before a high-quality job.

ICS came out of a manufacturing test environment for the NexPress light-emitting diode (LED)

printheads. In manufacturing, the engineers were looking to control intensity fluctuations across the page.

Once that is measured, the signal to the LED can be adjusted to account for the fluctuations. ICS is the

result of taking this manufacturing tool and creating a cost-effective and customer-friendly version for

NexPress end-users.

1 The printed target is the size of a legal sheet of paper.

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Enhanced Dry Inks, Developers, and Dry Ink Stations

Kodak’s new Dry Inks, Developers, and Ink Stations2 for the SE platform are designed to deliver smooth

flat tints, reduce print artifacts, and increase uptime. These image and process improvements are

facilitated by a mixing, delivery, and transfer system that Kodak has implemented to improve smoothness,

consistency, and uniformity. The new consumables are called “Enhanced” to differentiate them from

earlier generations of NexPress consumables. Like earlier Kodak Dry Inks, these toners are physically

ground (not chemically grown). They will be available later this year. Kodak notes that its Dry Inks (the

new formulation and the previous version) survive abrasion testing well and they come off the paper

easily during de-inking for recycling.

System Software v11

The version 11 system software for the NexPress front end uses Adobe’s PDF Print Engine 23, which

Kodak says is capable of processing files 30% to 70% faster than previous versions. This is the first front

end to use Adobe PDF Print Engine 2 in the production digital print market. One key aspect of PDF Print

Engine 2 is its enhanced object caching for improved variable data print processing performance.

PDF/VT4, currently being developed as an International Standards Organization (ISO) standard, is

important to the success of PDF Print Engine 2. Kodak expects that the PDF/VT standard will be

approved later this year.

The new system software has also been improved in regard to the set-up and job ticketing process for the

NexPress Dimensional Printing feature for those NexPress units that support this fifth station capability.

Users can now add the dimensional effect to any job at the NexPress (rather than having to create a mask

in prepress). The new system software includes a feature that allows the user to apply the dimensional

effect by using a user-definable threshold based on the local amount of ink coverage. This helps automate

the process so that dimensional can be added programmatically in a Web-to-print workflow. For example,

this would allow the print buyer to select the dimensional effect and have it added automatically to all text

in a business card, greeting card, or certificate application.

Other system software enhancements include improved job setup, updated service and output quality

diagnostics routines, and expanded qualified substrates. The improvements to the system software benefit

all NexPress products, including older NexPress 2100 units.

2 Kodak describes the Dry Ink station as the subsystem that mixes developer and Dry Ink, maintaining Dry Ink

concentration and charge-to-mass relationships and delivering Dry Ink to the imaging cylinder for transfer to the

latent image areas. Kodak notes that uniformity in concentration, charge distribution, and physical presentment of

the Dry Ink are critical for uniform transfer and, ultimately, smoothness on the printed page. 3 Adobe PDF Print Engine was introduced at IPEX in 2006. It provides native PDF processing capability, supporting

workflows where PDFs are kept in a high-resolution, device-independent state for as long as possible, which

facilitates re-use for multiple purposes (i.e. digital print, offset print, and electronic delivery) and allows for late-

stage editing. Adobe announced PDF Print Engine 2 at drupa in May of 2008. PDF Print Engine 2 brings key

processing capabilities to facilitate variable data printing, and therefore is a key component for PDF-based digital

print workflows. 4 PDF/VT stands for Portable Document Format/Variable Transaction.

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Kodak’s NexPress SE Positioning

In positioning the NexPress SE products, Kodak identifies what it calls four breakthroughs:

Superior output quality

Best in class productivity

Unique capabilities

Scalability, flexibility

Kodak positions the 120-image-per-minute (ipm) NexPress SE3600 at the top of the line in terms of

speed, volume, and productivity, followed by the SE3000 and SE2500 (see Figure 2). Reconditioned

versions of the NexPress 2500 and 2100 fall at the lower end of the product line with the NexPress M700

positioned as the affordable, lower volume option. Across the product line, there is workflow and

business development support. Features such as the dimensional printing effect are also a key

differentiator for the faster NexPress products.

Figure 2: Kodak Positioning for NexPress Product Line

Source: Kodak

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The New Look

The first look at the NexPress SE is a little deceiving, as the styling has shifted from the curved shape of

earlier models to a more angular design. The device looks very different, but there has been no change in

paper feed or the number of drawers.5 The product’s footprint is the same as the most recent models. The

height of the device is slightly shorter. Though the SE platform devices look different, the SE functional

improvements are not a central part of the products’ new look.

Figure 3: NexPress 2100 (top), NexPress 2500 (second from top), NexPress S3000 (second from bottom), SE3600 (bottom)

5 The paper capacity of the NexPress 2100 (sometimes called the “Classic”) has not changed since the NexPress

2100 Plus and subsequent models. The NexPress 2100 also lacked the high capacity stacker of later models. The

additional paper capacity of the newer models is visible on the right side of the device and the high capacity stacker

can be seen on the left side. Two other aspects of the NexPress 2100 are that it has a smaller maximum sheet size

and does not benefit from some subsequent enhancements that improve productivity for all sheet sizes in later

models.

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The new look represents a branding style that has been extended to other Kodak products, including

platesetters, scanners, and the recently introduced Prosper Color XL (see the InfoTrends analysis entitled

Kodak Announces Prosper Color XL Press for more details). The designs also reflect Kodak’s

environmental guidelines that reduce the chemical footprint of the cabinetry by moving from plastic to

metal parts, reduce the use of chemical fire retardants, and make use of environmentally-friendly paints.

These make the product easier to recycle at its end of life.

There is also a symbolic component to the new look because it takes the products away from the

combined Heidelberg/Kodak styling of the original joint venture product.

NexPress Product Line Overview

With the introduction of the new SE models, the product line ranges from the NexPress M7006 to the

NexPress SE3600 (see Table 1 below).

Table 1: Overview of the NexPress Product line

NexPress

Model Speed (ipm)

First Availability

Upgradeable to SE Platform List price and availability

7

M700 70 May 2007 No $235,000, available now

2100 70 Sept. 2001 No $377,000 (available as a reconditioned product)

2100 Plus 70 Sept. 2005 Yes No longer sold

2500 83 Q1 2006 Yes $450,000 (available as a reconditioned product)

S2100 June 2008 Yes No longer sold

S2500 83 June 2008 Yes $540,000, available now

S3000 100 October 2007 Yes $625,000, available now

S3600 120 Not applicable Not applicable Announced but never introduced, see SE3600

SE2500 83 Sept. 2009 Not applicable $570,000, available now

SE3000 100 Sept. 2009 Not applicable $655,000, available now

SE3600 120 July 2009 Not applicable $695,000, available now

The NexPress M700 is the entry-level offering in the product line and features a NexPress front end. The

original NexPress 2100 continues to be available as a reconditioned product. It was followed by the NexPress

2100 plus, which came out in 2005. The NexPress 2500 came out in 2001 and is available as a reconditioned

product. The next generation of NexPress products was the S class, which includes the S2100, S2500, and the

S3000. The S2500 was the first NexPress platform that provided Dimensional Printing capability. This feature

was later extended to the NexPress 2500 and the NexPress S3000. The S3000 is the one NexPress available

today that supports magnetic ink character recognition (MICR) printing in the fifth imaging unit. The

NexPress S3600 was announced, but never introduced. Kodak chose to hold this introduction until the SE class

became available. The SE platform will include the SE2500, SE3000, and SE3600. Kodak said that by the end

of 2009 or early 2010, it will switch its manufacturing line entirely to the SE platform.

6 Kodak sources the NexPress M700 print engine from Canon, which sells it as the imagePRESS C7000VP.

7 Prices include the five-station print engine (not applicable for the M700), the front-end with system software, and a

starter kit of supplies. All list prices are in U.S. dollars. The fifth-station capability for MICR costs extra, as does the

glossing unit.

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Upgradability

Kodak sees three classes of upgrades:

Ongoing renewal of devices in the field through improvements in parts, consumables, or system

software updates.

The ability to upgrade in the field to faster speed and/or a new or additional fifth imaging unit

Upgrading to the NexPress SE feature set

All of the NexPress SE features (i.e., the Intelligent Calibration System; the Enhanced Dry Inks,

Developers, and Dry Ink Stations; and the System Software v11) are available as upgrades for the

NexPress 2100 Plus, the NexPress 2500, and the NexPress S-Class devices. The NexPress 2100 Plus can

be upgraded for speed to 83 ipm, 100 ipm, and 120 ipm. In addition, it can benefit from the full SE

upgrade for quality performance. The SE upgrade can be combined with the 83-ipm and 100-ipm speed

upgrades. It comes standard with the 120-ipm speed upgrade. The original NexPress 2100 is the only

NexPress that cannot take advantage of the full SE upgrade or have a speed upgrade. Nevertheless, it can

be upgraded with ICS and System Software v11.

The list price for the SE upgrade is $35,000. This is for the quality/performance upgrade made possible

by ICS, the Enhanced Dry Inks, Developers, and Dry Ink Stations; and System Software v11. A speed

upgrade is not included in the SE upgrade price. The difference between the list prices of the different

speed products is approximately the list price of the available speed upgrades. For example, the list price

difference between the 83-ipm S2500 and the 100-ipm S3000 is $85,000. This would be the approximate

list price of a speed upgrade from 83-ipm to 100-ipm.

Table 2 – Upgradability of the NexPress Product Line

83-ipm Speed

Upgrade 100-ipm Speed

Upgrade

120-ipm Speed Upgrade

(includes SE upgrade)

ICS Upgrade Only

SE Upgrade (includes sys. software v11)

2100 No No No Yes Yes

2100 Plus, S2100 Yes Yes Yes Yes Yes

2500, S2500 NA Yes Yes Yes Yes

S3000 NA NA Yes Yes Yes

SE2500 NA Yes Yes NA NA

SE3000 NA NA Yes NA NA

SE3600 NA NA NA NA NA

NA = Not applicable because the product already has that speed or feature as part of the base configuration

Kodak said that its customers will most often upgrade when they add a new machine or want to provide

consistency (i.e., in speed or other features) across multiple engines. The modular design and base unit

encourage users to continue taking advantage of the existing machine. Kodak claims that NexPress is

used longer in the field and is capable of more volume over the life of the product than competitors’

offerings. Kodak stresses that it offers this level of field upgradeability to protect its customers’

investment from obsolescence and to help them gain an improved return on their initial investment.

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Options

Feeding and finishing options for the NexPress products include a roll-to-cut-sheet feeder, a paper cart,

the glossing unit, and additional high-capacity delivery. There is also a Watkiss booklet maker that

supports most NexPress products (but not the SE3600 at this point because of its higher speed). Side exit

capability is an “orderable option” that can be part of any NexPress that has at least 10.1 system software.

It was developed to support the Watkiss booklet maker, but it is being used by some NexPress users to

add a conveyor as necessary or as another output option in addition to the proof delivery.

Additional front-end nodes are also available for the NexPress front end, of which there are two: the

NexPress V and Vp8. Both front ends have a single processing node with multiple raster image processors

(RIPs) and the option to add a second node. Due to the market interest in photo applications and the

processing requirement for high volumes of high resolution images, the Vp comes with ICC profiles that

are tuned for photo applications. It also has a larger disk drive (292 GB versus 146 GB). Both front ends

now have a RAID 0 SAS Array. The Vp also has an additional Quadcore processor. Kodak had

announced a separate Creo-based NexPress front end, named the Kodak NexPress Vcs Front End, but

found that customers wanted to have one front end with more capabilities. Therefore, Kodak has chosen

to add key functionality from Creo-based front ends to the V and Vp front ends to provide greater

applications reach and a simple upgrade path for the installed base of NexPress customers. Likewise,

other key Kodak technologies, such as ColorFlow and Prinergy Digital, are being leveraged to build on

the benefits of the Creo front end and integrate workflow across the Kodak portfolio.

The Fifth Imaging Unit

The fifth imaging unit of the NexPress provides some important differentiators from other production

color digital print products. Broadly speaking, the fifth imaging unit provides the following capabilities:

Red, green, or blue for color gamut expansion and spot color matching

Clear coating (spot, full coat, and gloss coat)

Dimensional clear coating that provides a raised 3D effect

MICR (magnetic ink character recognition)

The fifth station capability remains standard on new purchases. This has been the case since shortly after

the introduction of the S class NexPress Products. All Kodak NexPress units are now manufactured and

shipped as five-color. Even prior to Kodak’s decision to make the fifth station standard, virtually all

customers (about 98% according to Kodak) chose the option. About half purchased the clear toner and the

glossing unit. Dimensional will likely gain ground in the NexPress installed base as time passes.

The customer chooses the desired fifth imaging unit solution at the time of purchase. The solution

selected can impact the price (for example, MICR is more expensive than the other options and to achieve

the full gloss capability the user needs to purchase the glossing unit). Additional fifth imaging units are

available as an option. It is not uncommon for a customer to have two or more of the capabilities listed

8 The “V” in the name is a roman numeral and therefore the product names are spoken as “Five” and “Five-P.”

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above. Kodak says that it takes about 15 minutes or less to change the fifth station.9 The fifth imaging unit

solution kit includes the replenisher and toning system.

The speed of the NexPress is generally not impacted by the use of the fifth imaging unit, but there are

some exceptions (see Table 3 below). For example, the new dimensional capability runs exclusively at 83

ipm, so it will run at that speed even on a 100-ipm S3000. MICR capability is only available on the S3000

where it runs at 100 ipm. MICR is not supported currently on other NexPress models, though it will be

available on the SE3000 when that product becomes available.

Table 3 – Availability and Speed Impact of Fifth Station Capabilities

Capability Impact on speed M7

00

21

00

21

00

Plu

s

25

00

S2

50

0

S3

00

0

SE

25

00

SE

30

00

SE

36

00

Intelligent Color (spot color and gamut expansion)

No impact NA Yes Yes Yes Yes Yes Yes Yes Yes

Intelligent Glossing No impact NA Yes Yes Yes Yes Yes Yes Yes Yes

Intelligent Coating (spot coating, water mark)

No impact NA Yes Yes Yes Yes Yes Yes Yes Yes

Intelligent Dimensional Runs at 83 ipm10

NA No No Yes Yes Yes Yes Yes Yes11

Intelligent MICR At 100 ipm12

NA No No No No Yes No Yes Yes13

NA = Not available (fifth station capability is not possible on the NexPress M700)

Kodak’s application positioning for the NexPress fifth station capability is covered in the Table below.

Table 4 – Kodak Positioning for NexPress Fifth Station Capability

Dim

en

sio

na

l

MIC

R

Co

ati

ng

Glo

ss

ing

/Wa

term

ark

Comments

Direct mail X X X High impact campaigns increase responses

Photo merchandise X X X Unique, personalized photo products generate higher margins

Catalogs X X X Products jump of the page for greater response rates

TransPromo X Secure promotional checks/rebates in full color with high ROMI

Business cards, POP14

X X Expanded printing applications utilizing a single press

Digital book covers & inserts X X X High quality, short run publications drive new business

Secure applications X X X X New application area for tickets, labels, and documents

9 This is the time it would take, for example, to change from clear coating to dimensional.

10 No impact when running without dimensional.

11 Dimensional is not available for the SE3600 now, but Kodak expects availability Q4 2009.

12 No impact when running without MICR

13 MICR is not available for the SE3600 now, but Kodak expects availability Q4 2009.

14 POP stands for point of purchase and ROMI stands for return on marketing investment

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NexPress uses the term “satin” to describe the finish of its clear toner for spot or full coating that has no

further treatment. This same toner produces a high gloss finish when run through the glossing unit to

finish the coating applied in the fifth station. The satin finish is possible with spot and full coat. The gloss

finish is only possible with full coat and a trip through the glossing unit. The full coat also provides

protection against abrasions with or without processing through the glossing unit.

Kodak notes that prior to the introduction of the dimensional or MICR capability, about half the jobs

printed on all NexPresses in the field used the fifth station. Most of these jobs employed the clear spot or

full coat. The company also noted that there is some similarity between the clear Dry Ink used for

spot/full coating and the one used for dimensional applications. Both are clear, but the particle size of the

Dimensional Dry Ink is much larger. This results in the high pile height that gives the dimensional effect

its tactile impact.

Environmental Advantages

With the industry’s focus on green issues and print sustainability, Kodak makes a point of identifying the

environmental advantages associated with NexPress products. These include:

FSC (Forest Stewardship Council) – Support for a wide range of FSC-certified papers

No VOCs (volatile organic compounds) – NexPress Dry Inks do not emit VOCs

Deinkability – NexPress has the INGEDE certificate of de-inkability (INGEDE is the International

Association of the De-inking Industry)

Food packaging and toy safety approval – NexPress has EU food packaging and EN71.3 Toy

Safety approvals

Recyclability – The NexPress has recyclable packaging, consumables, and even the device itself can

be recycled

Design – An environmentally responsible design that includes items such as redesigned Dry Ink

bottles that hold more toner (and therefore allow for fewer bottles over the life of a device); removal

of parts that contain heavy metals or phthalates15

; more metal components instead of molded plastic

ones; and the use of safe type 1 plastics where required

ISO certification – NexPress has ISO 14001 and 9001 certified manufacturing capability

15

Phthalates are generally used to increase the flexibility, transparency, durability, and longevity of plastics;

however, they are being phased out of many products in the United States and Europe because of health concerns.

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NexPress Return on Investment Study

This summer at the analyst event in Dayton, Ohio, Kodak presented data from a return on investment

(ROI) study of more than forty NexPress users. In a summary income statement based on this study,

Kodak concluded that a NexPress user printing 3 million A4-size pages annually had a fully burdened

cost per page of around 20-25 cents. This figure, as opposed to running cost figures (which typically

include only equipment, supplies, and service), takes into account the impact of all possible costs.

Based on Kodak’s tracking of market pricing in the range of 19-36 cents per page, the company

concluded that an average gross profit level of 40%-45% and an average net profit level of 20%-25%

were being attained. Using the improved metrics of the NexPress SE3600, Kodak projects that the cost

per average page would be reduced by 2-4 cents, while the gross profit level can rise to 50%-55% and the

net profit can improve to 30%-35%. Kodak states that the reasons for improved profitability lie in the

SE3600’s ability to deliver longer operator replaceable component (ORC) life, shorter set-up time

between jobs, improved print speed, and longer time between service calls.

While it is clear that profits also depend on page pricing, and competition within the market will influence

this, Kodak expects that the SE3600 will deliver an estimated 10%-15% reduction in costs. Kodak also

believes that the quality and consistency of the SE platform will help justify sell rates at higher than

average in the industry.

The SE3600 numbers are based on an annual assumption of 3.5 million A4-size pages (or a little more

than 290,000 per month), which is appropriate given the higher speed and productivity of the device. The

study of forty NexPress users had an average of around 3 million (250,000 per month), which is

representative of the installed base prior to the SE platform introductions. In general, the more volume

you run, the better your cost metrics. Users running at volumes lower than those in the study might not

necessarily see the same level of cost benefit, although this could be offset by higher page pricing and

other factors. Kodak also notes that these financial analyses do not include the revenue upside,

operational cost benefits, and therefore the incremental margin opportunity associated with the fifth

imaging unit capabilities.

Competition

The Table below compares three cut-sheet production color printers. These vendors were selected for the

Table because they occupy the top three market share positions in the 1 to 10 million duty cycle category

and are most comparable to the SE3600.

Each product can claim advantages in certain areas. For the NexPress SE3600, the improvements in the

platform position it well for speed and its numerous fifth station capabilities (such as spot color, clear

coating, dimensional, and MICR). Beyond the specifications, users will also judge the NexPress SE3600

on items such as productivity, quality, ease-of-use, and running cost.

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Table 5: Specifications of the HP Indigo 7000, Kodak NexPress SE3600, and Xerox iGen4

HP Indigo 7000 Kodak NexPress SE3600 Xerox iGen4

Four-color speed

16

120 ipm17

120 ipm 110 ipm

Print resolution 812 & 1,219 dpi, 8 bits/pixel18

600 dpi, multi-bit 600 x 4,800 dpi

Color capability Up to 7 colors19

5 color20

4 color

Max. paper size 13” x 19” 330 x 483 mm (approx.)

14” x 20.47” 356 x 520 mm

14.33” x 20.5” (standard21

) 364 x 521 mm

Max. print size 12.48” x 18.26” 317 x 464 mm

13.3” x 20” 340 x 510 mm

362 x 519 mm (standard)22

362 x 569 mm (optional)

Supported papers Coated: 55 lb. text to 130 lb. cover (80 to 350 gsm)

Uncoated: 40 lb. text to 120 lb. cover (60 to 320 gsm)

Coated: 20 lb. bond to 130 lb. cover (80 to 350 gsm)

Uncoated: 40 lb. text to 130 lb. cover (60 to 350 gsm)

Coated: 60 lb. text to 130 lb. cover (90 to 350 gsm)

Uncoated: 16 lb. bond to 130 lb. cover (60 to 350 gsm)

Paper input Four trays with a capacity of 6,100 sheets

23

Normal drawers: 3 x 1,800 sheet capacity

Special jobs drawer: 1 x 700 sheet capacity

Four feeders with a total capacity of 11,000 sheets

24

Two 1,000 sheet feeders

Two 4,500 sheet feeders

Up to six feeder modules (12 trays) with a total capacity of

30,000 sheets25

Paper output 6,000 sheet output capacity

1 stacker (600 mm stack height)

Proof tray (60 mm height)

5,000 sheet paper delivery

500 sheet proof delivery

Paper cart

Up to four stackers (two carts per stacker) with a total

capacity of 12,000 sheets (3,000 sheets per stacker)

Stacker top tray

Feeding and stacking options

1 additional feeding module with three drawers, each

capable of handling 1,800 sheets

1 additional 6,000 sheet stacking model

Additional 5,000 sheet delivery

Additional paper cart

Roll-to-cut-sheet unit

In-line booklet maker

In-line perfect binder

In-line punch unit

In-line UV coater

Post-fuser two-tray inserter

Roll-to-cut-sheet unit

List price $623,000 $695,000 $640,000

Price includes: Four-color device including delivery, installation, and

training

Five-station print engine, front end with system software, and a starter kit of supplies

Print engine, two-feeder configuration, one stacker, the FreeFlow print server,

and 15 days of training

16

These speeds are based on a two-up simplex letter imposition. 17

The 7000’s monochrome speed is faster: 240 monochrome ipm. It is also capable of 240 two-color ipm. 18

2,438 x 2,438 dpi is possible with the High Definition Imaging (HDI) option. 19

Capabilities beyond process color include: Standard or custom mixed spot color, expanded gamut (CMYKOV or

CMYKOVG), light cyan/light magenta, spot or flood matte coat. 20

Capabilities beyond process color include: Spot (red, green, or blue), expanded gamut (using R, G, or B), spot or

flood clear, flood gloss, dimensional (SE2500/SE3000), and MICR (SE3000). 21

The larger 14.33” x 22.5” format is optional. 22

Xerox notes that the maximum image area is 2 mm less than the sheet size (i.e., a 1 mm border on all sides). 23

Standard paper input capacity, including all four drawers, is 6,100 sheets. With the optional three-drawer feeding

module (which handles 5,400 sheets), the total capacity is 11,500 sheets using all seven drawers. These amounts are

based on the assumption of an 80 lb. text stock. 24

Capacity estimates are based on 100 gsm paper. 25

The 2,500 sheet per tray estimate is based on an 80 lb./120 gsm stock.

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Strengths, Weaknesses, Opportunities, and Threats (SWOT)

With the introduction of a new device, InfoTrends looks at the product’s strengths, weaknesses,

opportunities, and threats. These factors are summarized in the Table below.

Table 6: SWOT Analysis of the New NexPress SE Platform

Strengths

Higher speed of the SE3600 product

Fifth station capability and the associated colors or effects

Improved quality/consistency

Kodak focus on workflow

Upgradability of most of the installed base

Larger sheet size in comparison to HP Indigo competition

Operator replaceable component (ORC) service model

Processing power of Adobe PDF Print Engine 2

Range of environmental advantages

Weaknesses

Limited in-line finishing options

Lack of a consistent front-end strategy across its black & white and color digital print products

Smaller sheet size in comparison to Xerox iGen

No light production offering below the M700

Opportunities

Expanded product line provides broader opportunity than a point product or two

Higher volume and quality conscious print service providers

Unique fifth station applications

Upgrading its installed base

Threats

Competitive cut-sheet production color offerings in the 1 to 10 million impression per month duty cycle class

Lower priced printer models in the 301,000 to one million impression per month duty cycle class

Potential delay in the approval or adoption of the PDF/VT format standard

Kodak’s focus on the Stream/Prosper Color XL news takes away resources and media attention from the SE platform announcements

Conclusion

Kodak’s new NexPress SE platform represents a significant step forward. With the speed and quality

improvements, combined with existing NexPress capabilities (plus more recent ones such as dimensional),

the NexPress SE product line mounts a strong challenge to its primary competition from HP’s Indigo and

Xerox’s iGen. Kodak has an opportunity to win more deals and gain share as it rolls out the SE class

products. In addition, Kodak has a sizable upgrade opportunity in its NexPress installed base, which

InfoTrends estimates at about 1,400 units worldwide. Combined, these opportunities are substantial.

Kodak’s challenge will be to seize this opportunity in the face of a tough economic environment as well

as strong competition from HP, Indigo, Xerox, and others who are looking to grab a piece of the

production color digital print market.

This material is prepared specifically for clients of InfoTrends, Inc. The opinions expressed represent our interpretation and analysis of information

generally available to the public or released by responsible individuals in the subject companies. We believe that the sources of information on which our

material is based are reliable and we have applied our best professional judgment to the data obtained.