Megatrends in Digital Printing Applications

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Megatrends in Digital Printing Applications by I.T. Strategies 51 Mill Street, Suite 2 Hanover, MA 02339 (781) 826-0200 williams@it-strategies.com boer@it-strategies.com www.it-strategies.com 2010 PRIMIR/NPES

FOREWORD Digital Printing has been the hot spot of the production printing industry for the past few years: While overall print volumes in the US have been declining and share of GDP has gone down, digital print volumes have grown. Digital print equipment is omnipresent today; the majority of print shops own digital devices, and news forums and trade-shows are dominated with digital printing topics. This has supported a perception that digital print is on the verge of taking over and eventually dominating production printing; obviously with huge implications to all members of the printing industry. With the Megatrends in Digital Printing Applications study, PRIMIR was looking for a broad assessment of the future of digital print and the implications to the industry: Will Digital eventually take over the majority of printed volume? What does it mean for analog print? Will analog disappear or will both technologies co-exist, at what pace will change happen, and where is it most likely to occur first? To account for the fragmented nature of production printing with its diverse applications from newspapers through packaging to collateral, PRIMIR asked that the study be done at the application level, to highlight the specific situation and trends in each market segment, and to also compare and come up with a combined view for the printing industry. I.T. Strategies was selected as research partner due to their long and deep understanding of the printing industry and their research methodology. We believe that they did meet the expectations and presented a study with a wealth of market information and analysis, providing valuable insights to the various market segments. There are a number of significant findings in this study. Some are contrary to preconceived notions, while others point to exciting new opportunities for digital printing. We believe that this is a seminal study that will be referenced for many years, helping to develop a road map for the industry as digital printing enters the next phase of development and integration. We would also like to thank the PRIMIR task force members for their engagement in numerous conversations over many months. And, last but not least, we would like to thank the PRIMIR staff for their tireless work and guidance from proposal through final presentation and delivery of the report, without which this would not have happened. Andrew Gordon Paul Foszcz Georg Bernskoetter (formerly with manroland, Inc.) Hewlett-Packard GmbH December 2010

Megatrends in Digital Printing Applications Task Force Co-Chairs: Andrew Gordon, Paul Foszcz and Georg Bernskoetter Georg Bernskoetter Hewlett-Packard GmbH Hans Bjorkman International Paper Mylene Bourgeois Domtar Inc. Laura Butler Xerox Corporation Douglas Ehmann The Sheridan Group David Eisenstadt Hewlett Packard Edward I. Farley Unisource Worldwide Paul Foszcz (formerly with manroland, Inc.) Andrew Gordon Paul Jaynes Eastman Kodak Company Gavin Jordan-Smith Xerox Corporation Dianne Linderoth Unisource Worldwide James M. Luttrell X-Rite, Incorporated Richard A. Mazur Eastman Kodak Company Colleen Molkenbur Canon USA Si Nguyen Duplo USA Corporation Peter Ruth Polytype Ltd. Joseph S. Schember Canon USA Inc. Trish Siegel Hewlett Packard Mike Troy FUJIFILM North America Corporation

Megatrends in Digital Printing Applications Table of Contents I. Executive Summary...1 Study Objectives and Methodology...1 Scope...2 Key Study Findings...2 Individual Application Findings...4 Book Printing...4 Catalogs...5 Direct Mail...6 Flexible Packaging...7 Folding Cartons...9 Labels...10 Magazines...12 Manuals...14 Marketing Collateral...15 Newspapers...16 Specialty Printing...18 Transaction/Financial Printing...19 Application Comparison...20 Accelerating Digital Printing...22 Total Cost of Ownership Measurement...26 Forecast...27 Conclusion...29 Implications for Members...31 Future Research Recommendations...32 II. Introduction & Methodology...35 Introduction...35 Scope...36 Objectives...36 Methodology...37 Industry Research...37 About Market Sizing...38 Print Service Provider and Specifier Surveys...39 III. Forecast...41 Introduction...41 Production Page Forecast, North America...43 North American Unit Projection Model...47 IV. Comparing Applications: Where are the Opportunities for Digital Production Printing?...55 Introduction...55 i

Print Outlook...55 Print Service Providers...55 Specifiers...57 Tipping Points...58 Page Volumes...59 Page Volume Growth and Decline...60 Conclusion...63 The Bottom Line...64 V. Total Cost of Ownership...65 Introduction...65 How Users Measure Cost of Ownership/Cost of Print...66 Fixed Costs...67 Variable Costs...69 Cost Factors Often Overlooked...71 Impact of Volume/Breakpoints for Needing Additional Equipment...71 Electricity...72 Shifts and Utilization...72 Space/Storage...73 Decision Process: Analog or Digital?...74 Conclusion...75 VI. Drivers and Barriers...77 Factors Influencing a Tip from Analog to Digital Production Printing...80 Technology Factors...81 Market Factors...82 Economic Factors...83 Regulatory/Social Factors...85 Summary of Key Drivers to Tip Analog to Digital Print...86 Factors Slowing/Preventing a Tip from Analog to Digital Production Printing...87 Technology Factors...88 Market Factors...89 Economic Factors...90 Regulatory/Social Factors...92 Summary of Key Barriers Slowing or Preventing the Tip From Analog to Digital Print...93 The Bottom Line on Drivers and Barriers...94 VII. Books...95 Chapter Summary...95 Definition...96 Methodology for Book Analysis...97 State of the Book Printing Market...98 Print Service Provider Perspective...99 Specifier Perspective...102 Market Trends...104 Tipping Point...105 Why Not Tip?...107 Why Tip?...108 ii

Application Sizing...110 Digital Adoption Lifecycle...112 Implications for Members...113 Digital Production Printer Manufacturers...113 Paper Manufacturers...113 Analog Printing Equipment and Supplies Manufacturers...113 Print Service Providers...114 Books Conclusion...114 VIII. Catalogs...117 Chapter Summary...117 Definition...118 Methodology for Catalog Analysis...119 State of the Catalog Printing Market...120 Print Service Provider Perspective...120 Specifier Perspective...124 Market Trends...126 Tipping Point...127 Why Not Tip?...128 Why Tip?...131 Application Sizing...133 Digital Adoption Lifecycle...137 Implications for Members...138 Digital Production Printer Manufacturers...138 Paper Manufacturers...139 Analog Printing Equipment and Supplies Manufacturers...139 Print Service Providers...140 Catalogs Conclusion...140 IX. Direct Mail...143 Chapter Summary...143 Definition...144 Methodology for Direct Mail Analysis...144 State of the Direct Mail Printing Market...145 Print Service Provider Perspective...146 Specifier Perspective...149 Market Trends...151 Tipping Point...152 Why Not Tip?...154 Why Tip?...156 Application Sizing...158 Digital Adoption Lifecycle...160 Implications for Members...161 Digital Production Printer Manufacturers...161 Paper Manufacturers...162 Analog Printing Equipment and Supplies Manufacturers...162 Print Service Providers...162 Direct Mail Conclusion...163 iii

X. Labels...165 Chapter Summary...165 Definition...167 Methodology for Label Analysis...167 State of the Labels Printing Market...168 Print Service Provider Perspective...169 Specifier Perspective...173 Market Trends...175 Tipping Point...176 Why Not Tip?...177 Why Tip?...179 Application Sizing...181 Digital Adoption Lifecycle...183 Implications for Members...184 Digital Production Printer Manufacturers...184 Paper and Film Substrate Manufacturers...185 Analog Printing Equipment and Supplies Manufacturers...185 Print Service Providers...185 Labels Conclusion...186 XI. Magazines...187 Chapter Summary...187 Definition...189 Methodology for Magazine Analysis...189 State of the Magazine Printing Market...190 Print Service Provider Perspective...191 Specifier Perspective...194 Market Trends...197 Tipping Point...198 Why Not Tip?...200 Why Tip?...201 Application Sizing...204 Digital Adoption Lifecycle...207 Implications for Members...208 Digital Production Printer Manufacturers...208 Paper Manufacturers...209 Analog Printing Equipment and Supplies Manufacturers...210 Print Service Providers...210 Magazines Conclusion...211 XII. Manuals...213 Chapter Summary...213 Definition...214 Methodology for Manuals Analysis...215 State of the Manual Printing Market...215 Print Service Provider Perspective...216 Specifier Perspective...219 Market Trends...221 iv

Tipping Point...223 Why Not Tip?...224 Why Tip?...227 Application Sizing...228 Digital Adoption Lifecycle...230 Implications for Members...231 Digital Production Printer Manufacturers...231 Paper Manufacturers...231 Analog Printing Equipment and Supplies Manufacturers...231 Print Service Providers...232 Manuals Conclusion...232 XIII. Marketing Collateral...233 Chapter Summary...233 Definition...234 Methodology for Marketing Collateral Analysis...235 State of the Marketing Collateral Printing Market...236 Print Service Provider Perspective...237 Specifier Perspective...240 Market Trends...242 Tipping Point...244 Why Not Tip?...245 Why Tip?...248 Application Sizing...250 Digital Adoption Lifecycle...251 Implications for Members...253 Digital Production Printer Manufacturers...253 Paper Manufacturers...253 Analog Printing Equipment and Supplies Manufacturers...254 Print Service Providers...254 Marketing Collateral Conclusion...255 XIV. Newspapers...257 Chapter Summary...257 Definition...258 Methodology for Newspaper Analysis...259 State of the Newspaper Printing Market...260 Print Service Provider Perspective...261 Specifier Perspective...263 Market Trends...265 Tipping Point...267 Why Not Tip?...268 Why Tip?...270 Application Sizing...272 Digital Adoption Lifecycle...275 Implications for Members...277 Digital Production Printer Manufacturers...277 Paper Manufacturers...277 v

Analog Printing Equipment and Supplies Manufacturers...278 Print Service Providers...278 Newspapers Conclusion...279 XV. Flexible packaging...281 Chapter Summary...281 Definition...282 Methodology for Flexible Packaging Analysis...283 State of the Flexible Packaging Printing Market...284 Print Service Provider Perspective...284 Specifier Perspective...287 Market Trends...289 Tipping Point...289 Why Not Tip?...290 Why Tip?...292 Application Sizing...293 Digital Adoption Lifecycle...295 Implications for Members...296 Digital Production Printer Manufacturers...296 Film and Paper Manufacturers...296 Analog Printing Equipment and Supplies Manufacturers...296 Print Service Providers...296 Flexible Packaging Conclusion...297 XVI. Folding Cartons...299 Chapter Summary...299 Definition...301 Methodology for Folding Carton Analysis...301 State of the Folding Cartons Printing Market...302 Print Service Provider Perspective...303 Specifier Perspective...306 Market Trends...308 Tipping Point...309 Why Not Tip?...310 Why Tip?...311 Application Sizing...313 Digital Adoption Lifecycle...315 Implications for Members...316 Digital Production Printer Manufacturers...316 Paper Manufacturers...316 Analog Printing Equipment and Supplies Manufacturers...316 Print Service Providers...316 Folding Cartons Conclusion...317 XVII. Specialty Printing...319 Chapter Summary...319 Definition...319 Methodology for Specialty Printing Analysis...320 State of the Specialty Printing Market...321 vi

Print Service Provider Perspective...321 Specifier Perspective...324 Market Trends...326 Tipping Point...328 Why Not Tip?...329 Why Tip?...331 Application Sizing...332 Digital Adoption Lifecycle...334 Implications for Members...335 Digital Production Printer Manufacturers...335 Paper Manufacturers...336 Analog Printing Equipment and Supplies Manufacturers...336 Print Service Providers...336 Specialty Printing Conclusion...337 XVIII. Transaction/Financial Statements...339 Chapter Summary...339 Definition...340 Methodology for Financial/Transaction Analysis...340 State of the Transaction/Financial Statements Printing Market...341 Print Service Provider Perspective...343 Specifier Perspective...346 Market Trends...348 Tipping Point...350 Why Not Tip?...352 Why Tip?...353 Application Sizing...355 Digital Adoption Lifecycle...357 Implications for Members...358 Digital Production Printer Manufacturers...358 Paper Manufacturers...358 Analog Printing Equipment and Supplies Manufacturers...359 Print Service Providers...359 Transaction/Financial Statements Conclusion...360 XIX. Conclusions...361 Study Objectives...361 Page Volumes...361 Barriers and Enablers to Digital Production Printing...363 Barriers...363 Enablers...365 Focus for Digital Production Printing and Supplies Manufacturers...368 The Final Word...369 XX. Implications for Members...371 Implications for Analog Press Manufacturers...371 Implications for Analog Ink, Plate, Chemistry, and Other Analog Consumable Manufacturers...372 Implications for Digital Production Printer Manufacturers...372 vii

Implications for Digital Production Printer Consumable Manufacturers...373 Implications for Paper and Substrate Manufacturers...374 Implications for Print Service Providers...375 The Bottom Line...376 Appendix A: Glossary of Terms...377 Appendix B: Print Service Provider E-mail Survey...381 Appendix C: Printer Service Provider Telephone Discussion Guide...387 Appendix D: Print Specifier E-mail Survey...391 Appendix E: Print Specifier Telephone Discussion Guide...413 viii

Megatrends in Digital Printing Applications Table of Figures Exhibit I-1 Industry Research: Who We Interviewed...1 Exhibit I-2 Digital Printing Share of Production Pages, North America, 2009-2014...3 Exhibit I-3 Book Printing Page Volume Projections, North America, 2009-2014...4 Exhibit I-4 Catalog Printing Page Volume Projections, North America, 2009-2014...5 Exhibit I-5 Direct Mail Printing Page Volume Projections, North America, 2009-2014...7 Exhibit I-6 Flexible Printing Page Volume Projections, North America, 2009-2014...8 Exhibit I-7 Folding Cartons Page Volume Projections, North America, 2009-2014...9 Exhibit I-8 Label Printing Page Volume Projections, North America, 2009-2014...10 Exhibit I-9 Magazine Page Volume Projections, North America, 2009-2014...13 Exhibit I-10 Manual Page Volume Projections, North America, 2009-2014...14 Exhibit I-11 Marketing Collateral Page Volume Projections, North America, 2009-2014...15 Exhibit I-12 Newspaper Page Volume Projections, North America, 2009-2014...17 Exhibit I-13 Specialty Page Volume Projections, North America, 2009-2014...18 Exhibit I-14 Transaction/Financial Page Volume Projections, North America, 2009-2014...20 Exhibit I-15 Print Service Providers: Do you see a Tipping Point from Analog to Digital Production Printing? North America, 2010...21 Exhibit I-16 Letter-size, Simplex Production Pages by Print Technology Type, North America, 2009...22 Exhibit I-17 Digital Printing Share of Production Print, North America, 2009 and 2014...23 Exhibit I-18 Print Service Providers: Factors Driving Digital Page Volume Growth North America, 2010...24 Exhibit I-19 Print Service Providers: Important Influencing Tipping Point Factors in Accelerating a Shift from Analog to Digital Print Volumes, North America, 2010...25 Exhibit I-20 Letter-size, Simplex Production Pages, North America, 2007-2014...28 Exhibit I-21 Equivalent New Production Printing Systems Needed Annually to Serve Production Page Volumes, North America, 2009-2014...29 Exhibit I-22 Tipping Points by Application, North America, 2009, 2014, 2020...31 Exhibit II-1 Primary Research: Who We Interviewed, 2010...37 Exhibit III-1 Letter-size, Simplex Production Pages, North America, 2007-2014...44 Exhibit III-2 North American Production Page Volume Forecast by Application, 2009-2014...45 Exhibit III-3 Digital Printing Share of Total Production Pages, North America, 2009-2014...46 Exhibit III-4 Analog Print Technology Assumptions by Applications, North America, 2009...48 Exhibit III-5 Digital Print Technology Assumptions by Applications, North America, 2009...48 ix

Exhibit III-6 Unit and Installed Base Forecast Model, Analog and Digital Production Printers, North America, 2009-2014...50 Exhibit III-7 Analog Press Unit Sales (towers/engines) Needed to Meet Page Volume Requirements, North America, 2007-2014...51 Exhibit III- 8 Digital Production Printer Units Sales (engines) Needed to Meet Page Volume Requirements, North America, 2007-2014...52 Exhibit III-9 Relative Scale of Projected Unit Demand by Technology, North America, 2014...53 Exhibit IV-1 Print Service Providers: In the Next Four Years Will Your Total Production Print Volume Increase, Decrease or Stay the Same? North America, 2010...56 Exhibit IV-2 Specfiers: In the Next Four Years Will Your Total Production Print Volume Increase, Decrease or Stay the Same? North America, 2010...57 Exhibit IV-3 Print Service Providers: Do You See a Tipping Point from Analog to Digital Production Printing? North America, 2010...58 Exhibit IV-4 Letter-Size, Simplex, Production Pages by Print Technology Type, North America, 2009...60 Exhibit IV-5 Growth Rate Trends - Analog vs. Digital Production Pages, North America, 2009-2014...61 Exhibit IV-6 Combined Analog and Digital Production Page Volume Growth/Decline by Application Between 2009 and 2014, North America...62 Exhibit IV-7 Digital Production Page Volume by Application, North America, 2009-2014...62 Exhibit IV-8 Incremental Digital Pages Added by Application between 2009 and 2014, North America..63 Exhibit V-1 Print Service Providers: Factors Slowing/Preventing Conversion from Analog to Digital Print, North America, 2010 by Number of Responses...65 Exhibit V-2 Print Service Providers: Expected Remaining Life of Presses? North America, 2010...68 Exhibit V-3 Hypothetical Analog Ink vs. Digital Printing Toner/Ink Jet Ink Cost by Run Length, North America, 2010...70 Exhibit VI-1 Digital Printing Share of Production Print, North America, 2009 and 2014...77 Exhibit VI-2 Print Service Providers: Page Volume Trends - Do you Expect Growth or a Decline in Analog and Digitally Printed Pages? North America, 2010...78 Exhibit VI-3 Print Service Providers: Factors Driving Digital Page Volume Growth, North America, 2010...79 Exhibit VI-4 Print Service Providers: Important Influencing Tipping Point Factors in Accelerating a Shift from Analog to Digital Print Volumes, North America, 2010...80 Exhibit VI-5 Print Service Providers: Technology Drivers Required to Tip Analog to Digital Production Printing, North America, 2010...82 Exhibit VI-6 Print Service Providers: Market Drivers Required to Tip Analog to Digital Production Printing, North America, 2010...83 Exhibit VI-7 Print Service Providers: Economic Drivers Required to Tip Analog to Digital Production Printing, North America, 2010...84 x

Exhibit VI-8 Print Service Providers: Social/regulatory Drivers Required to Tip Analog to Digital Production Printing, North America, 2010...85 Exhibit VI-9 Print Service Providers: Important Tipping Point Factors in Slowing/Preventing a Shift from Analog to Digital Print Volumes, North America, 2010...87 Exhibit VI-10 Print Service Providers: Technology Barriers Slowing or Preventing a Tip from Analog to Digital Production Printing, North America, 2010...88 Exhibit VI-11 Print Service Providers: Market Barriers Slowing or Preventing a Tip from Analog to Digital Production Printing, North America, 2010...89 Exhibit VI-12 Print Service Providers: Economic Barriers Slowing or Preventing a Tip from Analog to Digital Production Printing, North America, 2010...91 Exhibit VI-13 Print Service Providers: Regulatory/Social Barriers Slowing or Preventing a Tip from Analog to Digital Production Printing, North America, 2010...93 Exhibit VII-1 Book Respondents Area of Focus by Sub-segment, North America, 2010...97 Exhibit VII-2 North American Book Expenditures at Retail, 2009...99 Exhibit VII-3 Print Service Providers: Book Printing Volumes 2010-2014, North America...100 Exhibit VII-4 Print Service Providers: Book Printing Volumes Why Declining? North America, 2010...101 Exhibit VII-5 Print Service Providers: Book Printing Volumes Why Growing? North America, 2010...102 Exhibit VII-6 Specifiers: Book Printing Volumes 2010-2014, North America...102 Exhibit VII-7 Specifiers: Is Digital Production Print Replacing Analog Volumes or Incremental? North America, 2010...103 Exhibit VII-8 Specifiers: Digital Print Volumes in 2 Years, North America, 2010...104 Exhibit VII-9 Specifiers: Offer Electronic Books Replacement vs. Incremental, North America, 2010...104 Exhibit VII-10 Specifiers: In Four Years, % of Book Print Volume Replaced by Electronic/Internet Books? North America, 2010...105 Exhibit VII-11 Print Service Providers: Tipping Point from Analog to Digital Production Printing, North America, 2010...106 Exhibit VII-12 Print Service Providers: Book Printing Reasons Against Tip to Digital Production Printing, North America, 2010...108 Exhibit VII-13 Book Tipping Point Drivers and Barriers Summary, North America, 2010...109 Exhibit VII-14 Print Service Providers: Book Printing Reasons for Tip to Digital Production Print, North America, 2010...110 Exhibit VII-15 Range of Books Page Production Volumes, North America, 2009...111 Exhibit VII-16 Books Letter Size, Simplex, Production Page Volume Forecast, North America, 2007-2014...111 Exhibit VII - 17 Digital Production Book Printing Volume: Technology Adoption Lifecycle, North America, 2010...112 Exhibit VIII-1 Print Service Providers: Catalog Print Volumes 2010-2014, North America...121 xi

Exhibit VIII-2 Print Service Providers: Catalog Printing Volumes Why Declining? North America, 2010...122 Exhibit VIII-3 Print Service Providers: Catalog Printing Volumes Why Growing? North America, 2010...123 Exhibit VIII-4 Specifiers: Catalog Printing Volumes 2010-2014, North America...124 Exhibit VIII-5 Specifiers: Is Digital Production Print Replacing Analog or Incremental? North America, 2010...125 Exhibit VIII-6 Specifiers: Digital Print Volumes in 2 Years, North America, 2010...125 Exhibit VIII-7 Specifiers: Offer Electronic Catalogs Replacement vs. Incremental, North America, 2010...126 Exhibit VIII-8 Specifiers: In Four Years, % of Catalog Print Volume Replaced by Electronic/Internet Catalogs? North America, 2010...127 Exhibit VIII-9 Print Service Providers: Tipping Point from Analog to Digital Production Printing, North America, 2010...128 Exhibit VIII-10 Print Service Providers: Catalog Printing Reasons Against Tip to Digital Production Printing, North America, 2010...130 Exhibit VIII-11 Catalog Tipping Point Drivers and Barriers, North America, 2010...131 Exhibit VIII-12 Print Service Providers: Catalog Printing Reasons for Tip to Digital Production Printing, North America, 2010...133 Exhibit VIII-13 Range of Catalog Page Production Volumes, North America, 2009...135 Exhibit VIII-14 Catalog Letter Size, Simplex, Production Page Volume Forecast, North America, 2007-2014...136 Exhibit VIII-15 Digital Production Catalog Printing Volume: Technology Adoption Lifecycle, North America, 2010...138 Exhibit IX-1 Print Service Providers: Direct Mail Print Volumes 2010-2014...147 Exhibit IX-2 Print Service Providers: Direct Mail Printing Volumes Why Declining? North America, 2010...147 Exhibit IX-3 Print Service Providers: Direct Mail Printing Volumes Why Growing? North America, 2010...148 Exhibit IX-4 Specifiers: Direct Mail Printing Volumes 2010 to 2014? North America...149 Exhibit IX-5 Specifiers: Is Digital Production Print Replacing Analog or Incremental? North America, 2010...150 Exhibit IX-6 Specifiers: Digital Print Volumes in Two Years, North America, 2010...150 Exhibit IX-7 Specifiers: Offer Electronic Direct Mail Replacement vs. Incremental, North America, 2010...151 Exhibit IX-8 Specifiers: In Four years, % of Direct Mail Print Volume Replaced by Electronic/Internet Direct Mail? North America, 2010...152 xii

Exhibit IX-9 Print Service Providers: Tipping Point from Analog to Digital Production Printing, North America, 2010...153 Exhibit IX-10 Print Service Providers: Direct Mail Printing Reasons Against Tip to Digital Production Printing, North America, 2010...155 Exhibit IX-11 Direct mail Tipping Point Drivers and Barriers, North America, 2010...156 Exhibit IX-12 Print Service Providers: Direct Mail Printing Reasons for Tip to Digital Production Print, North America, 2010...157 Exhibit IX-13 Range of Direct Mail Page Production Volumes, North America, 2009...159 Exhibit IX-14 Direct Mail Letter Size, Simplex, Production Page Volume Forecast, 2007-2014, North America...159 Exhibit IX-15 Digital Production Direct Mail Printing Volume: Technology Adoption Lifecycle, North America, 2010...161 Exhibit X-1 Print Service Providers; are your Label Printing Volumes Growing, Stable, or Declining Between Now and 2014? North America...170 Exhibit X-2 Print Service Providers: Labels Printing Volumes if Declining, Why? North America, 2010...171 Exhibit X-3 Print Service Providers: Labels Printing Volumes if Growing, Why? North America, 2010 172 Exhibit X-4 Specifiers: Are your Label Print Volumes Growing, Stable, or Declining Between Now and 2014? North America, 2010...173 Exhibit X-5 Is Digital Production Print Replacing Analog Volumes, or is it Incremental? North America, 2010...174 Exhibit X-6 Specifiers: Digital Print Volumes in 2 Years, North America, 2010...175 Exhibit X-7 Print Service Providers Who See a Tipping Point from Analog to Digital Production Printing, North America, 2010...176 Exhibit X-8 Print Service Providers, Why Won t Labels Printing Tip from Analog to Digital Production Print? North America, 2010...179 Exhibit X-9 Labels Tipping Point Drivers and Barriers...180 Exhibit X-10 Print Service Providers, Why Will Labels Printing Tip from Analog to Digital Production Print? North America, 2010...181 Exhibit X-11 Range of Labels Page Production Volumes, North America, 2009...182 Exhibit X-12 Labels Letter Size, Simplex, Production Page Volume Forecast, 2007-2014, North America...183 Exhibit X-13 Digital Production Labels Printing Volume: Technology Adoption Lifecycle, North America, 2010...184 Exhibit XI-1 Print Service Providers: Are your Magazine Print Volumes Growing, Stable, or Declining Between Now and 2014? North America, 2010...192 xiii

Exhibit XI-2 Print Service Providers: Magazine Printing Volumes if Declining, Why? North America, 2010...193 Exhibit XI-3 Print Service Providers: Magazine Printing Volumes if Growing, Why? North America, 2010...193 Exhibit XI-4 Specifiers; are your Magazine Print Volumes Growing, Stable, or Declining Between Now and 2014? North America, 2010...195 Exhibit XI-5 Is Digital Production Print Replacing Analog Volumes, or is it Incremental? North America, 2010...196 Exhibit XI-6 Specifiers: Digital Print Volumes in 2 Years, North America, 20110...196 Exhibit XI-7 Specifiers: Offer Electronic Magazines, Replacement vs. Incremental, North America, 2010...197 Exhibit XI-8 Specifiers: In Four Years, % of Magazine Print Volume Replaced by Electronic/Internet Magazines? North America, 2010...198 Exhibit XI-9 Respondents Who See a Tipping Point from Analog to Digital Production Printing, North America, 2010...199 Exhibit XI-10 Print Service Providers, Why Will Magazine Printing Not Tip from Analog to Digital Production Print? North America, 2010...201 Exhibit XI-11 Magazine Tipping Point Drivers and Barriers, North America, 2010...202 Exhibit XI-12 Print Service Providers, Why Will Magazine Printing Tip from Analog to Digital Production Print? North America, 2010...203 Exhibit XI-13 Range of Magazine Page Production Volumes, North America, 2009...205 Exhibit XI-14 Magazine Letter Size, Simplex, Production Page Volume Forecast, 2007-2014, North America...206 Exhibit XI-15 Digital Production Magazine Printing Volume: Technology Adoption Lifecycle, North America, 2010...208 Exhibit XII-1 Primary Market Focus of Manual Printing, North America, 2010...214 Exhibit XII-2 Print Service Providers: are your Manual Print Volumes Growing, Stable, or Declining Between Now and 2014? North America...217 Exhibit XII-3 Printer Service Providers: Manuals Printing Volumes if Declining, Why? North America, 2010...218 Exhibit XII-4 Printer Service Providers: Manuals Printing Volumes if Growing, Why? North America, 2010...219 Exhibit XII-5 Specifiers, are your Manual Print Volumes Growing, Stable, or Declining Between Now and 2014? North America 2010...220 Exhibit XII-6 Is Digital Production Print Replacing Analog Volumes, or is it Incremental? North America, 2010...220 Exhibit XII-7 Specifiers: Digital Print Volumes in 2 Years, North America, 2010...221 xiv

Exhibit XII-8 Specifiers: Electronic Manuals, Replacement vs. Incremental, North America 2010...222 Exhibit XII-9 Specifiers, in Four Years, What % of your Manual Print Volume will be Replaced by Electronic/Internet Manuals? North America, 2010...222 Exhibit XII-10 Print Service Providers Who See a Tipping Point from Analog to Digital Production Printing, North America, 2010...224 Exhibit XII-11 Print Service Providers, Why Won t Manual Printing Tip from Analog to Digital Production Print? North America, 2010...226 Exhibit XII-12 Manual Tipping Point Drivers and Barriers...227 Exhibit XII-13 Print Service Providers, Why Will Manual Printing Tip from Analog to Digital Production Print? North America, 2010...228 Exhibit XII-14 Range of Manual Page Production Volumes, North America, 2009...229 Exhibit XII-15 Manuals Letter Size, Simplex, Production Page Volume Forecast, 2007-2014, North America...229 Exhibit XII-16 Digital Production Manuals Printing Volume: Technology Adoption Lifecycle, North America, 2010...230 Exhibit XIII-1 Print Service Providers: Are your Marketing Collateral Printing Volumes Growing, Stable, or Declining Between Now and 2014? North America, 2010...237 Exhibit XIII-2 Print Service Providers: Marketing Collateral Printing Volumes if Declining, Why? North America, 2010...238 Exhibit XIII-3 Print Service Providers: Marketing Collateral Printing Volumes if Growing, Why? North America, 2010...239 Exhibit XIII-4 Specifiers: Are your Marketing Collateral Print Volumes Growing, stable, or Declining Between Now and 2014? North America, 2010...240 Exhibit XIII-5 Is Digital Production Print Replacing Analog Volumes, or is it Incremental? North America, 2010...241 Exhibit XIII-6 Specifiers: Digital Print Volumes in 2 Years, North America, 2010...242 Exhibit XIII-7 Specifiers: Electronic Marketing Collateral Replacement vs. Incremental, North America, 2010...243 Exhibit XIII-8 Specifiers, in Four Years, What % of your Marketing Collateral Print Volume Will be Replaced by Electronic/Internet Marketing Collateral? North America, 2010...244 Exhibit XIII-9 Print Service Providers Who See a Tipping Point from Analog to Digital Production Printing, North America, 2010...245 Exhibit XIII-10 Print Service Providers, Why Won t Marketing Collateral Printing Tip from Analog to Digital Production Print? North America, 2010...247 Exhibit XIII - 11 Marketing Collateral Tipping Point Drivers and Barriers, North America, 2010...248 Exhibit XIII-12 Print Service Providers, Why will Marketing Collateral Printing Tip from Analog to Digital Production Print? North America, 2010...249 xv

Exhibit XIII-13 Range of Marketing Collateral Page Production Volumes, North America, 2009...250 Exhibit XIII-14 Marketing Collateral Letter Size, Simplex, Production Page Volume Forecast, North America, 2007-2014...251 Exhibit XIII-15 Digital Production Marketing Collateral Printing Volume: Technology Adoption Lifecycle, North America, 2010...252 Exhibit XIV-1 Print Service Providers: Are your Newspaper Print Volumes Growing, Stable, or Declining Between now and 2014? North America, 2010...261 Exhibit XIV-2 Print Service Providers: Newspaper Printing Volumes if Declining, Why? North America, 2010...262 Exhibit XIV-3 Print Service Providers: Newspaper Printing Volumes if Growing, Why? North America, 2010...263 Exhibit XIV-4 Specifiers: are your Newspaper Print Volumes Growing, Stable, or Declining Between Now and 2014? North America, 2010...263 Exhibit XIV-5 Is Digital Production Print Replacing Analog Volumes, or is it Incremental? North America, 2010...264 Exhibit XIV-6 Specifiers: Digital Print Volumes in 2 Years, North America, 2010...265 Exhibit XIV-7 Specifiers, Electronic Newspapers, Replacement vs. Incremental, North America, 2010..266 Exhibit XIV-8 Specifiers, in Four Years, What % of your Newspaper Print Volume Will be Replaced by Electronic/Internet Newspapers? North America, 2010...266 Exhibit XIV-9 Print Service Providers Who See a Tipping Point from Analog to Digital Production Printing, North America, 2010...268 Exhibit XIV-10 Print Service Providers, Why Won t Newspaper Printing Tip from Analog to Digital Production Print? North America, 2010...270 Exhibit XIV-11 Newspaper Tipping Point Drivers and Barriers, North America, 2010...271 Exhibit XIV-12 Print Service Providers, Why Will Newspaper Printing Tip from Analog to Digital Production Print? North America, 2010...272 Exhibit XIV-13 Range of Newspaper Page Production Volumes, North America, 2009...273 Exhibit XIV-14 Newspaper Letter Size, Simplex, Production Page Volume Forecast, North America, 2007-2014...274 Exhibit XIV-15 Digital Production Newspaper Printing Volume: Technology Adoption Lifecycle, North America, 2010...276 Exhibit XV-1 Print Service Providers: Flexible Packaging Printing Volumes 2010-2014, North America...285 Exhibit XV-2 Print Service Providers: Flexible Packaging Printing Volumes Why Declining? North America, 2010...286 Exhibit XV-3 Print Service Providers: Flexible Packaging Printing Volumes Why Growing? North America, 2010...286 xvi

Exhibit XV-4 Specifiers: Flexible Packaging Printing Volumes, North America, 2010-2014...287 Exhibit XV-5 Specifiers: Is Digital Production Print Replacing Analog or Incremental? North America, 2010...288 Exhibit XV-6 Specifiers: Flexible Packaging Digital Print Volumes in Two Years, North America, 2010...288 Exhibit XV-7 Print Service Providers: Tipping Point from Analog to Digital Production Printing, North America, 2010...290 Exhibit XV-8 Print Service Providers: Flexible Packaging Reasons Against Tip to Digital Production Printing North America, 2010...291 Exhibit XV-9 Flexible Packaging Tipping Point Drivers and Barriers, North America, 2010...292 Exhibit XV-10 Print Service Providers: Flexible Packaging Reasons for Tip to Digital Production Print, North America, 2010...293 Exhibit XV-11 Range of Flexible Packaging Page Production Volumes, North America, 2009...294 Exhibit XV-12 Flexible Packaging Letter Size, Simplex, Production Page Volume Forecast, North America, 2007-2014...294 Exhibit XV-13 Digital Production Flexible Packaging Volume: Technology Adoption Lifecycle, North America, 2010...295 Exhibit XVI-1 Print Service Providers: Folding Carton Printing Volumes, North America, 2010-2014..304 Exhibit XVI-2 Print Service Providers: Folding Carton Printing Volumes Why Declining? North America, 2010...304 Exhibit XVI-3 Print Service Providers: Folding Carton Printing Volumes Why Growing? North America, 2010...305 Exhibit XVI-4 Specifiers: Folding Carton Printing Volumes, North America, 2010-2014...306 Exhibit XVI-5 Specifiers: Is Digital Production Print Replacing Analog or Incremental? North America, 2010...307 Exhibit XVI-6 Specifiers: Digital Print Volumes in Two Years, North America, 2010...308 Exhibit XVI-7 Print Service Providers: Tipping Point from Analog to Digital Production Printing, North America, 2010...309 Exhibit XVI-8 Print Service Providers: Folding Cartons Reasons Against Tip to Digital Production Printing, North America, 2010...311 Exhibit XVI-9 Folding Cartons Tipping Point Drivers and Barriers, North America, 2010...312 Exhibit XVI-10 Print Service Providers: Folding Cartons Printing Reasons for Tip to Digital Production Print, North America, 2010...313 Exhibit XVI-11 Range of Folding Cartons Page Production Volumes, North America, 2009...314 Exhibit XVI-12 Folding Cartons Letter Size, Simplex, Production Page Volume Forecast, North America, 2007-2014...314 xvii

Exhibit XVI-13 Digital Production Folding Cartons Printing Volume: Technology Adoption Lifecycle, North America, 2010...315 Exhibit XVII-1 Print Service Providers: Specialty Printing Print Volumes 2010-2014, America...322 Exhibit XVII-2 Print Service Providers: Specialty Printing Volumes Why Declining? North America, 2010...323 Exhibit XVII-3 Print Service Providers: Specialty Printing Why Growing? North America, 2010...324 Exhibit XVII-4 Specifiers: Specialty Printing Print Volumes, 2010-2014? North America...325 Exhibit XVII-5 Is Digital Production Print Replacing Analog, Incremental? North America, 2010...325 Exhibit XVII-6 Specifiers: Digital Print Volumes in 2 Years, North America, 2010...326 Exhibit XVII-7 Specifiers: Electronic Display of Specialty Printing Applications, Replacement Vs. Incremental, North America, 2010...327 Exhibit XVII-8 Specifiers, in Four Years, What % of your Specialty Printing Print Volume will be Replaced by Electronic/Internet Specialty Printing? North America, 2010...328 Exhibit XVII-9 Print Service Providers: Who See a Tipping Point from Analog to Digital Production Printing North America, 2010...329 Exhibit XVII-10 Print Service Providers: Why Won t Specialty Printing Tip from Analog to Digital Production Print? North America, 2010...330 Exhibit XVII-11 Specialty Printing Tipping Point Drivers and Barriers, North America, 2010...331 Exhibit XVII-12 Print Service Providers, Why Will Specialty Printing Tip from Analog to Digital Production Print? North America, 2010...332 Exhibit XVII-13 Range of Specialty Printing Page Production Volumes, North America, 2009...333 Exhibit XVII-14 Specialty Printing Letter Size, Simplex, Production Page Volume Forecast, North America, 2007-2014...334 Exhibit XVII-15 Digital Production Specialty Printing Volume: Technology Adoption Lifecycle, North America, 2010...335 Exhibit XVIII-1 Print Service Providers: Transaction/Financial Statements Printing Volumes, 2010-2014, North America...344 Exhibit XVIII-2 Print Service Providers: Transaction/Financial Statements Printing Volumes Why Declining? North America, 2010...345 Exhibit XVIII-3 Print Service Providers: Transaction/Financial Statements Printing Volumes Why Growing? North America, 2010...346 Exhibit XVIII-4 Specifiers: Transaction/Financial Statements Print Volumes 2010-2014, North America...347 Exhibit XVIII-5 Specifiers: Is Digital Production Print Replacing Analog or Incremental? North America, 2010...347 Exhibit XVIII-6 Specifiers: Digital Print Volumes in 2 Years, North America, 2010...348 xviii

Exhibit XVIII-7 Specifiers: Electronic Transaction/Financial Statements, Replacement vs. Incremental, North America, 2010...349 Exhibit XVIII-8 Specifiers, in Four Years, What % of your Transaction/Financial Statements Print Volume Will be Replaced by Electronic/Internet Transaction/Financial Statements? North America, 2010...350 Exhibit XVIII-9 Print Service Providers: Who See a Tipping Point from Analog to Digital Production Printing, North America, 2010...351 Exhibit XVIII-10 Print Service Providers: Why Won t Transaction/Financial Statements Printing Tip from Analog to Digital Production Print? North America, 2010...353 Exhibit XVIII-11 Transaction/Financial Statements Tipping Point Drivers and Barriers, North America, 2010...354 Exhibit XVIII-12 Print Service Providers: Why Will Transaction/Financial Statements Printing Tip from Analog to Digital Production Print? North America, 2010...355 Exhibit XVIII-13 Range of Transaction/Financial Statements Page Production Volumes, North America, 2009...356 Exhibit XVIII-14 Transaction/Financial Statements Letter Size, Simplex, Production Page Volume Forecast, North America, 2007-2014...357 Exhibit XVIII-15 Digital Production Transaction/Financial Statement Printing Volume: Technology Adoption Lifecycle, North America, 2010...358 Exhibit XIX-1 Digital Printing Share of Production Pages, North America, 2009...361 Exhibit XIX-2 Letter-size, Simplex Production Pages, North America, 2007-2009...362 Exhibit XIX-3 Print Service Providers: Factors That Will Slow/Prevent Conversion from Analog to Digital Print, North America, 2010...364 Exhibit XIX-4 Print Service Providers: Factors That Will Enable Conversion from Analog to Digital Print, North America, 2010...366 Exhibit XIX-5 To Tip Analog to Digital Production Print Pages...367 Exhibit XIX-6 Digital Production Pages. North America, 2014...368 Exhibit XIX-7 Analog to Digital: Tipping Point Projection Beyond 2014, North America...370 xix