This much we know: the world's biggest press manufacturer plans to get back into the commercial digital printing market, and these plans will be realised sooner rather than later.

What we don't know is who Heidelberg will be partnering with, although naturally speculation abounds (see boxout). But we do know some of the why and how, thanks to a recent briefing given by Stephan Plenz, board member responsible for equipment.

Plenz explains that Heidelberg separates the market for digital printing equipment into five segments: office printers (largely irrelevant from a graphic arts point-of-view); entry-level machines in the 60ppm realm (also more relevant for the office, believes Plenz, along with some tasks such as proofing); value devices producing 80-90ppm; higher quality performance machines such as the HP Indigo 7000 and Xerox iGen4 in the 120ppm bracket; and high-volume inkjet products rated at more than 250ppm.

While Heidelberg already has a finger in the inkjet pie through its LinoPrint venture, this is very much a niche business at the current time and not a fit for the majority of Heidelberg's customers in the commercial print space.

Plenz freely admits that when the press giant first began revisiting the digital model, expectations automatically gravitated towards an offering in that 'performance' space.

"It seemed obvious that these performance machines have the biggest footprint in our market and they produce most of the stuff, so we have to go for that," he says.

But when Heidelberg went back to the drawing board and analysed the short-run work mix of its core customers, a very different picture emerged, of which more later.

Common objectives

Heidelberg isn't alone in its desire to capitalise on the digital print opportunity, and competitors have also been busy. Of the German 'big three' Heidelberg, Manroland and KBA it was Manroland that was first out of the starting blocks with a revamped 21st-century digital offering, announcing a partnership with Oc for high-volume inkjet in December.

Like Heidelberg, Manroland tried and failed with digital before (see boxout), so the Oc deal has attracted lots of attention. As part of the agreement, Manroland will sell Oc's high-speed continuous-feed systems from the JetStream and ColorStream range. In return Oc will gain access to Manroland's know-how. And, of course, its client base.

While some have questioned what's in this for Manroland, the firm's UK managing director Normal Revill describes the deal as a "nice fit". "I'm really impressed with the equipment and the company. Manroland GB will be one of the companies in the first phase of launching these products," he says. "There are really interesting things we can develop together in terms of the market. The digital revolution is here to stay and we should be part of it."

Manroland chief executive Gerd Finkbeiner has set a target of €100m for the new digital offering in the next three-to-four years. And Robert Weiss, head of technology and business development at the group, believes the market is much more open to digital now than it was a decade ago when Manroland teamed up with Xeikon. "The total cost of ownership is completely different to toner 10 years ago and today. The higher productivity of inkjet and lower cost is a major difference. We want to combine the best from both partners."

Meanwhile, over at KBA the digital picture is still somewhat murky. When the manufacturer announced plans to diversify into new business areas some 14 months ago, digital printing was one of the opportunities mentioned. In a recent presentation to financial analysts KBA specifically highlighted inkjet printing as having the best prospects in terms of performance and flexibility, perhaps providing some clues about where its attention may be focused.

Director of marketing and corporate communications Klaus Schmidt provides an update on the current state-of-play: "KBA is still interested in entering the digital field and is in ongoing negotiations with a potential partner. However, our plans are not only limited to a sales-and-service agreement with an established digital press supplier," he states.

"This is the difference compared to the announced partnership between Manroland and Oc, and Heidelberg's plans. We think margins and profits in such a sales-and-service-only partnership will be lower for our colleagues in Heidelberg and Augsburg since the big brands already have their own global sales and service network."

Schmidt hopes KBA can reveal more about its own plans "in the near future", while admitting "unfortunately negotiations of this kind take longer than originally expected".

Which brings us back to Heidelberg. The firm has defined its digital strategy after taking a range of typical short-run job mixes from its customers, then calculating the print costs via different methods (various digital presses, SM 52 Anicolor, regular offset, etc), and this is the result of its computations: "It's exactly between 200 and 500 pieces where the breakeven is. Everything above 500, you pay less money at a printshop if it's printed sheetfed offset, which is obvious," states Plenz. "And now this question comes into play: if 250 is the breakeven for Anicolor, how many of these digital jobs really require the higher quality of that performance digital device? Maybe the photobooks, but that's about it."

So the Heidelberg solution will look like this: an offering that is integrated into its Prinect workflow, with a digital device from the 'value' 80-90ppm segment and €100,000 (£84,000) price point to handle ultra-short runs and variable work, an Anicolor sheetfed offset press, and what can be described as a 'job gate' featuring smart software that will divert incoming jobs to the most appropriate printing device. The digital device will incorporate Heidelberg's colour management know-how for enhanced quality and consistency.

"For me, there is no doubt this will be the solution for the future and this will change the digital industry because the argument for that performance digital segment disappears," Plenz asserts. He also highlights a further opportunity at the other end of the short-run spectrum using web-to-print, whereby jobs are ganged up on, say, a VLF offset press. "This is a very interesting portion. If you go to the big web-to-print shops printing in very large formats, down to runs of 50pp they are always cheaper than digital printing."

Happy punters

Of course, lots of Heidelberg's customers are also already users of kit from the likes of HP and Xerox on average 70% have existing digital kit of one form or another. But Plenz doesn't see this as disadvantage. In fact, the firm's number-one targets are those firms running more than two performance digital machines. "Not many of them are really happy and have really fallen in love with these machines," he says. "And the click-charge model where you have to print a lot just to get a good rate with your supplier is too expensive. You should ask 'how many of them are making money out of digital?' There are some, with a really clever business model, but most of them paid more than they expected."

Plenz retains an admirable poker-face when quizzed on the identity of the digital partner. Current hot tip among industry speculators is Konica Minolta (Heidelberg already has a sales partnership with the manufacturer in Australia), but Canon's name has also come up. "The latest word on the street is sometimes true... Sometimes it's not," is his only comment.

Heidelberg has pledged to reveal its digital partnership by its financial year-end in March. And by partnership Heidelberg is unequivocal that this will not just be the sort of sales-and-service arrangement cited by Schmidt. Plenz asserts: "We will work together with somebody where we will influence the product for the future. And we will find more synergies for the future from both directions. That's why we searched for a partner who was willing to open their R&D and test lab to us. And, on the other side, we will reveal to them what we have already done in inkjet with our Linoprint and what we know about colour management and integrating workflows."Now we just need to know the who.