Infotrends

Executive Summary

This document was prepared for a Congressional oversight hearing scheduled for May 11, 2011. InfoTrends was asked to answer questions about the market transition toward digital processes. The key trends can be divided into three categories:

Technology

„h Print, which used to be the central information delivery method, has become secondary

„h Traditional print reproduction methods, which are best suited to manufacturing many copies of the same content, are under increasing pressure to meet tight deadlines and to provide economic short runs of the most up-to-date and targeted information

„h Digital print methods are well established today for short-run, quick turnaround, targeted, and personalized work; new technology developments specifically related to high-speed color inkjet printing will challenge conventional printing press technologies even further in the coming years

„h Offset printing technology, while under attack from a range of digital technologies, remains viable because there are still compelling economic reasons for using it for many types of documents, particularly those that are required in large numbers

„h High-speed Internet connectivity and mobile phone technologies have enabled information delivery in ways that are impossible for print to achieve

Industry

„h Market consolidation among commercial printers has reduced the number of sites significantly over the past two decades, while at the same time industry employment levels have also dropped

„h Automated workflow tools have allowed workers to become much more productive, which has resulted in an increase in revenue produced per worker

„h Many printers are evolving from craft-oriented, print-only manufacturers into service-oriented marketing service providers who meet clients¡¦ overall promotional needs

„h A service (rather than a craft) orientation is well suited to meeting customer needs for the creation, management, and distribution of information¡Xwhether in electronic format or in print

ANALYSIS Transitioning to Digital

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Content

„h Digital delivery of information has many advantages, including ease of searching, the inclusion of live hyperlinks and multimedia, the ability to access content quickly, portability, tight control of content, and the ability to update as needed.

„h Print continues to have significant value as a content delivery method through its physical aspects such as the lack of requirement for an electronic device to read it, the ability to easily archive, to annotate a document, to read without concern for electricity or battery life, and to easily recycle the paper

„h Print is also egalitarian in the sense that it does not require high-tech devices or monthly service plans

„h Publishers and other content providers have seen how digital print and electronic delivery can be used in combination to create a ¡§data warehouse¡¨ of documents that allows books to be delivered as orders are received

„h The models for delivering and paying for content in the digital age are evolving and have had a significant impact on the publishing market

„h The success of e-delivery is in large part dependent on appealing mobile devices that have only entered the market recently

„h Libraries are embracing their position as source of information rather than a repository of books

„h Formatting has moved away from designing for print first; the needs of e-delivery are seen as more important and are the basis for decisions on the choice of fonts and other design elements

ANALYSIS Transitioning to Digital

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Introduction

The United States Government Printing Office¡¦s core mission, as stated on its Website

(www.gpo.gov/about/strategicplan.htm), is to ¡§Produce, protect, preserve, and distribute

documents of our democracy.¡¨ When the GPO was founded 150 years ago, the only

feasible method of producing, protecting, preserving, and distributing documents was in

print. Today, with a multitude of electronic distribution methods widely available, that

has changed. An appropriate question for today is ¡§What is the best method (or what are

the best methods) of producing, protecting, preserving, and distributing any type of

document?¡¨ To effectively answer this question requires an understanding of the purpose

of the document and the customer it serves.

In this statement, InfoTrends will explore how changes in digital technology and

distribution methods for published content are impacting the printing industry.

Technology

Four transitions that are happening simultaneously in printing and publishing:

„h Print to electronic: Print has become a secondary information delivery method to

electronic methods, such as the Internet.

„h Long run to short run: Ongoing InfoTrends research on run lengths supports the

assumption that run lengths are becoming shorter (see Figure 1 below).

Figure 1: Change in Print Jobs per Run Length

c 2011 InfoTrends, Inc. www.infotrends.com 22

2008

Change in Print Jobs Per Run Length (2004-2011)

For the following run lengths (sets of documents), do you see an increase or decrease in the frequency of printing jobs?

Source: InfoTrends 2004, 2008, and 2011 Print Service Provider Surveys

Percentage of Respondents

Run Length Range

48%50%

...