Modern Communication Technologies Driving Changes in Analog and Digital Printing

The role of print is changing due to the impact of the Internet and mobile connectivity on the way businesses and individuals communicate and access information. This affects traditional printing (changing expectations of speed, relevance, and degree of interactivity) and is driving growth in digital printing.

The global print market is shrinking in volume but growing in value over the period 2014-2024, according to the Smithers Pira report The Future of Digital versus Offset Printing to 2024. Output measured in billions of A4 prints (A4 paper measures 8.3" × 11.7" inches) was 49,973 in 2014 and is forecast to decline very slightly to 49,654 by 2024. In value terms, print output grows from a total of US$767.4 billion in 2014 to US$862.7 billion in 2024—a CAGR of 1.18 percent. The average value of print increases slightly over the 10-year period, as a result of changes in product mix, and the print processes employed.

Litho, other analog, and digital print market development 2014–24, in value terms (% share by value, constant 2017 basis

How Print is Changing
Both analog and digital print production is becoming more efficient, which contributes to improving unit costs. In addition, increasing capabilities in short-run printing and associated downstream converting processes are leading to improved supply chain efficiencies.

There are substantial differences in the growth trajectories of end markets, geographic regions, and the print technologies employed. Broadly speaking, the main growth areas (i.e., those that add more than US$40 billion of value from 2019 to 2024 versus a total market value in 2024 of US$862.7 billion) are:

• Regional: Combined analog and digital print in Asia (growth between 2019-2024 = US$43.3 billion)
• End application: Packaging and labels (growth between 2019-2024 = US$75.5 billion)
• Print technology: Inkjet printing (growth between 2019-2024 = US$41 billion)

The segments with the largest forecast declines between 2019 and 2024 are:

• Regional: Combined analogue and digital print in North America (decline between 2019-2024 = US$3.5 billion)
• End application: Publications (decline between 2019-2024 = US$17.0 billion)
• Print technology: Offset litho printing (decline between 2019-2024 = US$18.6 billion)

The Rise of Digital Printing
Looking at the market from a print value perspective, 2019 represents an inflexion point at which the value of offset litho print output is overtaken by the aggregate value of non-offset litho analogue print processes. In particular, flexo grows substantially in value from US$143.4 billion in 2014 to US$180.7 billion in 2024—due primarily to growth in the packaging and labels sectors.

The fastest growing print segment is digital, which increases in value from US$103 billion in 2014 to US$180.9 billion in 2024. In 2014 electrophotography was the dominant digital printing process, a position built on liquid and dry powder toner color press output. Inkjet is the growth engine for digital printing. The value of inkjet output had overtaken electrophotography by 2018, and while the value of electrophotography print output is pegged at US$63 billion between 2019 and 2024, the value of inkjet printed output is predicted to grow from US$77.3 billion to US$118.3 billion in the same period, making it clearly the fastest growing of any print process by value.

There are several reasons behind inkjet's growth. Most significant is the development of scalable and robust single pass inkjet print technology that has enabled high productivity inkjet printing, coupled with the increasing capability of inkjet inks to address a wider set of application needs.

Key end-market print applications
The main end applications covered in the report that are affected by major market shifts due to changing technology are publications, graphics, and packaging.

High-volume print segments, such as newspapers and magazines, are declining. As circulations fall, advertising revenues are increasingly diverted from print to other channels, especially the Internet. With the increased capability of modern smartphones and tablets, internet users are switching from desktop to mobile device usage, driving growth in mobile advertising.

Book printing is the one area in the publication segment that will grow in value from 2019-2024. This is due to the growth of inkjet printing, which enables cost effective short run end-to-end book manufacturing. This enables new products (tailored academic course books and self-publishing) and just-in-time supply chains for publishers.

The graphics segment is declining in value between 2019-2024 from US$237 billion to US$233 billion. Sheetfed litho is the major analog print process in graphics applications, and is declining in the main advertising and commercial print markets. Digital is growing in these segments, but at an insufficient rate to prevent overall decline.

In contrast, global demand for packaging print is forecast to grow strongly. This is driven by global population growth, increasing urbanization, and growth of middle-class consumers—especially in Asia. In addition, the number of one-person households in the developed world is increasing, which drives demand for packaging through, for example, food supplied in smaller portion sizes.

Supplementing these drivers, brand owners are using printed packaging in increasingly sophisticated ways to promote their brand values and to connect with consumers. Consequently, the packaging and labels sectors grow from US$420 billion in 2019 to US$495 billion by 2024.

Developments in printing technologies
With improvements in workflow, pre-print, automation, sensing technology, big data mining and analytics, artificial intelligence, ink chemistry, and ink curing, both analog print and digital print processes are becoming increasingly efficient.

Sheetfed offset litho has seen significant changes with the development of web-to-print workflows coupled with software that can combine print jobs to optimize production efficiency. Print operations are using standardized color reproduction to ensure that they meet customer quality expectations. In addition, print operations are improving sheetfed press productivity using automation and press performance analytics, which enables benchmarking of a particular printing press against best-in-class performance. After benchmarking, they can use the data to highlight where operational efficiencies can be made.

Flexo printing is also benefitting from press automation, and other innovations, such as the increasing use of expanded gamut printing, which reduces make-ready time. There have been improvements in flexo plate and anilox roll technologies, which allow flexo to print at higher resolutions and compete for higher quality print jobs.

Inkjet is the print process showing the largest growth from 2014 to 2024. In the graphics area, inkjet has built a strong position in wide-format printing. High productivity flatbed printers using scanning heads and 100 percent UV inks have been important in growing the inkjet presence in the graphics market. However, it is full color, high-resolution, single-pass fixed head printing that will sustain the growth of inkjet over the coming years.

Overall, technology is enhancing the efficiency of both analog and digital print processes. Over the coming five years, the cost of digital will fall due to the availability of increasingly productive presses and economies of scale in ink production and distribution, printhead production, etc., as well as changing business models in the digital supply chain. This gives digital print the prospect of competing beyond short run lengths.

For more information on The Future of Digital versus Offset Printing to 2024 and other market reports from Smithers Pira, visit the website at www.smitherspira.com/industry-market-reports.

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