Konica Minolta's Print Production Blueprint for the Future

At an analyst, press, and customer event in New York City Konica Minolta launched two new color products and hinted at (but did not provide specifics on) announcements to come later this year. Rick Taylor, Konica Minolta U.S.’s President and Chief Operating Officer, and other Konica Minolta U.S. executives also outlined the company’s strategy in a presentation titled “Blueprint for the Future” that showed how print technology remains at the core, but is surrounded by solutions and services.

Information Management, IT Service, and Technology

Taylor opened the proceedings with an overview of Konica Minolta’s global fiscal 2013 successes. It was a year that saw a 16% increase in revenue and a 42% increase in operating income. Other highlighted increases were operating profit ratio (8.8%); total MFP revenue (25%); office revenue (22%); production revenue (39%); global revenue (41%); 55% OPS/MPS revenue; and IT services revenue (84%). While some of this growth is organic, a fair amount comes from Konica Minolta’s recent acquisitions, including Copytronics, CopySource, Pitney Bowes Canada’s document imaging solutions business, AMS Imaging, and KnowledgeCentrix. Taylor said that Konica Minolta will continue to acquire companies.

As he began to discuss Konica Minolta’s blueprint for the future, Taylor also highlighted production print growth, particularly in color. He said that sales were good and customers were largely optimistic, having no issue with five-year leases. He described the Konica Minolta brand as having three components: Information Management, IT Services, and Technology. Sam Errigo, Senior Vice President of Business Intelligence Services continued the strategic theme by outlining the company’s services and solutions platform that takes customer requirements and provides a solution blueprint with the three components mentioned above. Built around that are process management, reporting, and metrics.

Hardware continues to be at the center of Konica Minolta’s ecosystem. Their intent is to surround the product with software, services, and technology to support vertical market needs in government, finance, legal, graphic communications, healthcare, manufacturing, and education.

Konica Minolta described its overall approach in four-point fashion: (1) incubate, (2) invest, (3) partner, and (4) mergers & acquisitions. Supporting the incubation part of the approach are Konica Minolta’s newly announced Business Innovation Centers (BICs), five of which are being formed in key regional markets including North America, Europe, Asia Pacific, China and Japan. The U.S. center is in Silicon Valley (Foster City, California to be precise) and was represented at the event by that BIC’s vice president, Ekta Sahasi.

Looking forward, Errigo defined nine areas of interest: intelligent assistant & voice interfaces, human computer interface, Internet, healthcare knowledge hub, 3D printing marketplaces, intelligent data, connected marketing platforms, security compliance, and intelligent spaces. IT services play a key role in many of these areas, and Konica Minolta’s All Covered group has been very active there, acquiring fourteen companies and driving revenue growth in areas such as managed IT services (delivered to customers large and small), cloud services, and IT projects (such as application development and support for office relocation and acquisitions).

New Color and Recent Black & White

Despite all the talk about services, the headline announcement at the event was the release of the Konica Minolta bizhub PRESS C1100, which had first been shown as a technology demonstration at drupa 2012.

The C1100 supports substrates from 55 gsm to 350 gsm and its speed is 100 images per minute regardless of substrate type or weight. Konica Minolta has doubled the maximum monthly duty cycle to 1 million A4/letter impressions per month over the C8000. The paper capacity is also increased (to 13, 890 sheets). Several new aspects of the device include a large diameter belt and air separation fusing system as well as new expanded-gamut magenta toner as part of the new Simitri toners the system uses. A sister device, the C1085 with 85-ipm speed and a 750,000 sheet monthly duty cycle, is also now available. Konica Minolta said that the base list price of the C1100 (not including the controller or other options) is about $150,000. The base list price of the C1085 is around $130,000. The announcements do not immediately replace existing offerings. Konica Minolta said that the C8000 will stay in the product line until existing inventory is exhausted.

The news about the C1100 and C1085 follows the June 16 launch of Konica Minolta’s bizhub PRESS 2250P, a dual-engine monochrome system capable of 250 duplex impressions per minute (15,000 per hour) at 1200 x 1200 dot per inch resolution. Using two bizhub PRESS 1250P engines connected in a single design, the 2250P is capable of a maximum monthly duty cycle of six million A4/letter impressions. The device supports substrates as light as 40 gsm and as heavy as 350 gsm for both simplex and duplex printing. Konica Minolta is particularly excited about its opportunity in light transactional printing environments with the 2250P.

Konica Minolta invited four early placement customers of the bizhub C1100 to discuss their impressions of the product. The panel, hosted by Dino Pagliarello, Konica Minolta U.S.’s Director of Product Marketing, included John McNichol, Vice President of Information Technology for Horizon Business Forms; Todd Beauregard, President MDT / Custom Cuts; Mike Kaufman, President of Cox Printers; and Jay Adcock, Vice President of Digital Dog Direct. They were all equally enthusiastic about the C1100, particularly in regard to speed, saying it was twice as productive as the 8000, particularly on thick stocks. They liked the quality, stability, low energy costs (a 20% reduction), and improved registration.

The new products will be shown at Graph Expo (September 28th to October 1st in Chicago). Konica Minolta hinted at, but did not describe some additional announcements that will occur in that time frame. Stay tuned. The company noted that the KM-1 B2-format inkjet printer will not be displayed at the show. Konica Minolta is focusing on beta site placements for the KM-1, which will begin early next year.

3D Printing Rollout

A sign of progress since the June announcement of a distribution alliance is that two 3D Systems devices have recently been installed at the Konica Minolta customer engagement center in Manhattan: a ProJet 660 Pro and a ProJet 3500 HDMax. 3D Systems’ printers are also going into four other Konica Minolta centers in Ramsey, New Jersey; Chicago, Illinois; Dallas, Texas; and Anaheim, California. (There’s not one yet in the Atlanta Konica Minolta center, but that’s mainly because there’s a 3D Systems location nearby where customers can go for demonstrations.) The Konica Minolta direct sales force is not the only beneficiary of this move. Konica Minolta dealers can sell the products but they need to have been trained on servicing the devices and must have a demo device on site. Four Konica Minolta dealers are already signed up. One, NovaCopy in Nashville, has been selling 3D printers for several years.

One of the most memorable handouts from the event was a small bottle with a color label printed on a 3D Systems’ ProJet 660 Pro. The ProJet 660 Pro prints with five colors: cyan, magenta, yellow, black, and white. In contrast, the ProJet 3500 HDMax doesn’t print in color, but has much higher print resolution than the Project 660 Pro.

Other Items of Interest

Some other noteworthy items came out at this event:

• Konica Minolta produced a fun video about a ‘dream printer’ that takes kids’ ideas and produces a personalized portrait for them. It’s worth a look. (Over 2 million views to date.)
• Panelist Michael Kaufman of Cox Printing explained how his company has taken the idea of corporate social conscience to a new level. In addition to solar panels on the roof, which produce some of the energy consumed by their offset presses, they have also installed honey bee hives up there. The initiative is a great example of corporate citizenship and has produced some good marketing benefits, including recent coverage on the Today show.
• Rick Taylor used a number of third-party quotes in his presentation, but one of the most memorable was his own (I think): “Social media is how companies will hear about crappy service.” (Rick is now active on Twitter at @ricktaylor444)

InfoTrends Opinion

Konica Minolta is building momentum with products that move it further into commercial print and other higher volume production environments. They called this event “Blueprint for the Future,” and though much of the content was about the Konica Minolta of today, the presentations did give analysts and press a good view of where Konica Minolta is headed. Some aspects, such as 3D printing and B2-format production inkjet printers, were—for the most part—left out of the executive presentations, but overall the message is clear: Konica Minolta is targeting the production market with a combination of technologies and services that bode well for continued success.

Anyone interested in recent year-over-year financial performance of key imaging and printing system providers may find the InfoTrends “Vendor Financial Analysis: Calendar Years 2010-2013” analysis to be of interest. One key factor over the past year has been the positive impact of exchange rates for the Japanese companies.