Friday 30 December, 2011

Polymer prices reduced twice in December

The current economic slowdown has spurred the RBI to lower its GDP growth forecast for the financial year 2011-12 to 6.9%. While our company IppStar thinks that this is a premature downgrade for the GDP forecast, there are signs that the Indian industry’s high growth over the past three years is softening. The index of industrial production showed a sharp deceleration with a growth of only 2.79% between July to September 2011. The IIP figure for October 2011 was 0.3% and there has been a sharp rise in the November 2011 IIP figure to 6.8%. Reasons cited by experts for the slowing down of growth are softening domestic demand because of high interest rates and rising inflation. However, at least food inflation seems to have moderated in December.

Polymers which are used in six key industries (agriculture, automotive, infrastructure, healthcare, appliances and flexible packaging) are affected by the economic slump. In India flexible packaging is the biggest consumer of polymers using more than half of the entire production. The ban on polybags and the ban on flexible packaging for gutka (chewing tobacco) has affected flexible packaging although monolayer polybags are being replaced by multilayer polybags and polymer based non-woven fabrics.

One outcome is that since January 2011 till the third week of December 2011, the prices of all variants of polymers have been revised 5 times. Between January to November 2011, prices of polymers were increased thrice. In November, major Indian polymer manufacturers — Indian Oil Corporation, Haldia Petrochemicals, Gas Authority of India Ltd and Reliance Industries have increased the prices of polypropylene and polyethylene by Rs. 3 per kilogram and Rs. 1.50 per kilogram respectively. These prices were raised to keep pace with surging global prices of naphtha, the key input used in manufacturing polymers. In addition, the sharp devaluation of the Indian Rupee in comparison to the US$ has made imports more expensive, which in turn triggered the upward movement of domestic polymer prices.

In December, polymer prices have been reduced twice — first by Rs. 2 per kilogram in the first week of the month and the second time by Rs. 2.50 per kilogram in the third week. These price decreases are an attempt to spur domestic polymer demand. Polymer demand has slowed both because of the slow local industry growth as well as low global demand especially in America and Europe because of festive and holiday season. The lower prices are expected to increase polymer export, which has fallen drastically as China, a major polymer importer from India, has stopped import in the recent past.

On the other hand, IppStar’s ongoing research of the Indian print, packaging and publishing industry shows continuing double digit growth in most of the packaging segments. Polymer based packaging including labels continue to add blown film lines and high speed printing and converting equipment.

Monday 19 December, 2011

Tough times for web-offset manufacturers

We have written in earlier years about the inevitable consolidation of the offset press manufacturers and particularly about the leading international manufacturers of high speed web offset presses. As we wrote after the last drupa in July 2008, “The top two manufacturers in the 70,000-plus-cph markets are manroland and KBA and our estimates put manroland ahead of KBA by about US$ 300 million in this category. Together they currently command almost 60% of the market and the other five players share the balance 40%with Goss, perhaps the sales leader of this group in these type of presses. With most of these manufacturers hovering between US$ 250 to 325 million in sales of 70,000 cph plus presses, will all five survive in their present structure on their own?”

In the ensuing years the downturn of the newspaper market in Europe, North America and Japan has continued while new developments such as tablets (iPads) have just been around for less than two years. Some parts of our forecast of consolidation have already come true with Shanghai Electric acquiring Goss International in 2010. In the meanwhile with intermittent interventions by the German government, unsuccessful consolidation discussions have taken place between almost all of the European offset press suppliers: Heidelberg, KBA, manroland, Solna and Wifag. Although unsuccessful thus far, one can reasonably expect some consolidation of the European press manufacturers coming out of the insolvency filing of manroland on 25 November 2011.

The state of the Indian web offset manufacturers
Too often the Indian machinery manufacturers think that they are immune from what is happening in the rest of the world or even in the Indian economy. This is partly a function of their relatively small size whereby they can subsist even lean years when sales plummet to half as they did in the 2008-09 financial year. Nevertheless it is safe to say that over the past decade the Indian web offset manufacturers led by Manugraph and The Printers House have grown into a R600 crore (US$ 125 million) industry. This has happened on the back of increased editions, pagination, circulations and particularly the rapid rise of 4-colour pages of the Indian dailies. Although our newspaper industry can be safely expected to continue to grow in the next decade, it would be foolish to ignore the possibility and need for increased consolidation among the publishers and ultimately some consolidation by the more than 20 local web offset press manufacturers.

Another factor that has kept many of the Indian web-offset press manufacturers alive has been the increased expenditure by the government and by the economy as a whole on education. A good percentage of the web presses bought in recent years are producing educational books. Moreover, as exports of presses have fallen, domestic consumption has taken up the slack.

This is true even for organised manufacturer-exporters such as Manugraph and The Printers House. Both companies have turned their attention on the emerging markets in Asia, Africa, and Latin America and to some extent the Middle East. While one enjoys a good market share in Russia, the other does well in China. Manugraph has, notably, begun the sales of Chinese manufactured converting equipment to the local board packaging industry. Manugraph of course has also taken on the big players by launching and installing its 4 x1 presses in two newspapers which is the first real challenge to the European and Japanese manufacturers from an emerging economy web-offset manufacturer in the 70,000 cph segment.

While both the newspaper and the book printing market will remain healthy in India and the outlook is not gloomy for its web press manufacturers, they will nevertheless also be compelled to think about consolidation. Many of them have not been able to professionalise their companies and they can expect generational issues to impact them as much as they are being impacted by the increased costs of raw materials, engineering inputs and extremely competitive markets at home and abroad.
— Naresh Khanna
editor@ippgroup.in

Wednesday 14 December, 2011

How can the packaging industry be greener?

Vijay Gupta of Siegwerk India

“Change management is always difficult, but industry has to lead, especially if there is no law that insists on change for the better.” – Vijay Gupta of Siegwerk India

Mostly, most of us do not think. We tend to repeat cliches and slogans that put us in a helpless situation in which we are always waiting for the other guy (or the government) to do something. Thus it was refreshing to talk to Vijay Gupta who admitted that industry has to lead on environment, health and safety issues. Well some of you might say Gupta or the ink company he leads has a ‘vested interest’ in talking about environment – that he wants to sell more expensive ink. Well you would be wrong.

First of all, many of you already happily buy his ink and indeed inks from the other excellent ink companies who have state of the art plants within India – DIC, Sakata, Huber-Micro, Flint, Toyo and others. All of these companies manufacture safer and more environmentally friendly inks than we generally buy in India. Unfortunately neither packaging buyers are insisting on greener and safer inks, nor is the government able to go into the entire gamut of complex technical, social and administrative issues which it needs to address to come up with a total cradle to grave packaging life-cycle program. The industry associations are also on the defensive about issues which are indefensible instead of coming up with a plan or a solution in which the end-users, the packaging converters, the suppliers of equipment and consumables and the government can apply their creativity and their extensive assets.

Secondly, come out of your denial of facts. Stop denying that we do every day does not have intense environmental, health and safety implications. Packaging uses the overwhelming majority of paper, paperboard, plastics and films consumed in India. Fact – The Indian packaging industry will use more than 7.5 million tonnes of paper and paperboard and more than 5 million tonnes

of plastics and films in the 2010-2011 financial year (source: IppStar Indian Print Industry Survey 2011 www.ippstar.org). In comparison to the rest of the world this is not a huge amount in per capita terms. This is precisely why we could be one of the greenest packaging industries and countries in the world. But take a look at the garbage strewn everywhere; at the lack of separation of various waste materials; at the almost total absence of collection and waste recycling systems.

Thirdly, act now. Use sustainable materials as much as you can. Convince your customers to lightweight and to use materials that can be separated for recycling. When environmentally friendly fountain solution concentrates and recycling systems are available in India why not use them? When process-less or low chemistry plates are available, why not use them? When low-chemistry processing and recycling systems are available why not use them? When low solvent inks are available in India why not use them? When solvent recovery systems are available why not use them? When sustainable forest sourced paper and paperboard is available why not offer to use these at least for customers who can be pursuaded? And then no matter what materials you are using right from the oil for the lubrication of your machines to your film and plate chemistry to the water for dampening solutions – these are the wastes in your factory and it is your responsibility to reuse, recycle and reduce these – to treat and ultimately dispose these not in some drain or nala but responsibly. There is a lot you can do and are already doing. Speak out and send me an email about what you are doing at editor@ippgroup.in

- Naresh Khanna

Environment and Packaging

The 'informal' recycling sector in India

The environment discussion in India is in danger of not being a discussion at all. The government’s ban on plastic for gutkha packaging in March 2011 first of all mixed up the distinct health hazards of tobacco with the environmental hazards of the extensive use of plastic packaging without any clarity on its collection, disposal or recycling.

Leave aside packaging the entire issue of waste disposal in India is a huge scandal. In the capital we have sewerage lines that actually do not reach the treatment plants. The collection of garbage and its dumping in overflowing landfills is totally haphazard. Needless to say there is no separation of plastic, glass, metal or organic waste in the municipal waste collection system although this is being done by some of the neighbourhood residential welfare committees. This is actually a shocking state of affairs and many responsible persons blithely make statements about waste recovery by the informal sector — a euphemism for children who are compelled or forced to work as scavengers.

We have become aware that the debate in packaging is not really about plastic versus paper — all waste is an issue and the ecosystem has to deal with all materials and products. For instance in board packaging, MetPet which is board laminated with polyester is gaining in strength for FMCG and other packaging due to its attractiveness and high shelf appeal. When rational and systematic environmental laws and practices come into effect (it will happen eventually) MetPet will also pose severe environmental consequences and regulation. At present MetPet seems almost indispensible as it is difficult to achieve the same attractive packaging in a cost effective manner since the other available alternatives like cold foiling, cast and cure do not seem either viable or widespread options.

Unlike PET, PVC or HDPE, which are comparatively easier to recycle, the biggest hurdle in recycling MetPet lies in the difficulty that one faces in trying to separate the metallised plastic films from the board. In a recent discussion with Saket Kanoria of TCPL, we discovered that paper mills today can use 5% MetPet in the waste recycling process for for paper production, but making paper from 100% MetPet waste is very difficult. Naturally, the biggest chunk of MetPet is either incinerated or ends up in landfills. Proper legislation is required to check the MetPet explosion and alternatives like metallic foils being transferred only on the required surface need to be promoted.

The label industry meanwhile has of late managed to take a green turn with the introduction of siliconised PPE substrate for label facestock, as opposed to the earlier siliconised glassine that has been in use globally for decades. Unlike siliconised glassine which becomes practically useless once the facestock had been removed and has to be incinerated, siliconised PPE is completely recyclable. Also the PPE substrate is much lighter and has helped in reducing the overall weight of labels thereby reducing transportation costs.

Another printing process that is being hailed as being sustainable and environment friendly and is being used for anti-counterfeiting applications as well as to achieve holographic effects is Cast and Cure. In this process UV inks and coatings are used instead of potentially more hazardous VOC based inks. Cast and Cure also seem to have removed the dependability on unrecyclable metalised substrates and foil boards that play an important role in similar processes. The films used in the process to render the designs can also be used more than ten times.

- Avinandan Mukherjee

Monday 12 December, 2011

Gearing up for drupa 2012


As I write this, a presentation from the organisers of drupa 2012 is taking place in Bangalore. The Bangalore event today will be followed by a similar event tomorrow at the Hotel Taj Mahal Palace in Mumbai, which will be covered by Indian Printer and Publisher. Both these events have already received massive registrations reflecting the importance of the event for the Indian print industry.

Indian Printer and Publisher is honoured to be a drupa media partner again. For us this has meant that we have tried to maximise and optimise the participation of both Indian visitors and exhibitors at the single largest and most important printing show in the world. Right from the first drupa in which we were media partners, we developed the concept and brand TeamIndia@drupa. We have also tried to present an Indian and Asian point of view to an industry that often seems obsessed with the gloom and doom for print in the developed economies in the West.

The idea has been that we must turn this important event into a knowledge event so that those who visit and those who cannot for various reasons should get the most out of the time, effort and expense to the industry as a whole. And also that we need to support the Indian exhibitors in their efforts to present and export their equipment to the rest of the world. Our manufacturers are strong because the Indian printers are a good market for them to develop and test their equipment. And their equipment improves to a large extent because they have to have a benchmark standard in order to export.

Thus, apart from being the technology window for Indian printers we want to be the platform that presents Indian equipment, software and consumables to the world print market. Our magazines and our websites are seen by the whole world as the collective and quality platform of the Indian printing industry. Our magazines can be outspoken and critical but together with our conferences, research and ethical consultancy activities they have contributed greatly to the print community of the subcontinent.

As drupa media partners we will fully participate in various press events where international companies share what they will bring to the event. Additionally we will create a Facebook community led by Indian printers and manufacturers for the event and an Print Asia@drupa blog for ongoing discussion before and after the event. The idea is to optimise the effort of the entire industry and the need for it to act responsibly and maturely — to foster the spirit of helping each other to realise the goals of growth and excellence. We look forward to your feedback.

We would also like to encourage the Indian printing community, especially those who are going to drupa '12, to come together and start using the TeamIndia@drupa logo on their websites, brochures, catalogues and other products. We believe this would help promote the Indian print industry as a whole on an unified platform, and project us as an active, ever-growing and fast evolving community to the world! You can click here to download a high-resolution version of the TeamIndia@drupa logo.

- Avinandan Mukherjee

Thursday 28 July, 2011

Japanese print industry ready for IGAS from 16 to 21 September 2011

Country recovers from earthquake as print is forced to adapt to change
28 July 2011, Tokyo – In the aftermath of the earthquake and tsunami in March this year, the IGAS organisers actually had to reevaluate whether they would be able to hold the quadrennial international exhibition in Tokyo this September. The exhibition is going forward and gathering steam although it will have 16% less floor area than the last event in 2007.
     I think the event will be an important show not only for the region but for the entire print industry since it is many of the Japanese companies who have learnt to adapt to the changing circumstances that print faces in much of the developed world and are in fact in the forefront of development of the next generation of digital ink jet presses.
     At a media preview that took place today, FujiFilm, Screen, Horizon, Ryobi, Duplo, Konica Minolta, and Komori made presentations about what they will show at IGAS. The only non-Japanese company that made a presentation today was HP and it also confirmed the importance of the IGAS show in its overall growth plans in Asia by announcing that its D-Scoop user event will take place in Tokyo alongside the event.
     The real question for Asian printers is whether IGAS will be worth visiting and will it have interesting equipment and technology on display to buy and whether it will have equipment and demonstrations that show the future of print? Japan has been amongst the hardest hit economies by the economic crunch of 2008 and its printing industry suffered the steepest decline amongst the developed economies in 2010. And then came the earthquake and the tsunami this March.
     I believe that IGAS is well worth a visit for those printers who are growing in Asia and who are interested in finding out what the next steps may be for them. In the heavy metal department both Komori and Ryobi are not simply talking about printing but talking about their special technologies for printing with UV inks. I also think that printers in Asia can learn a lot from the Japan Color Standard which will be shown in its own special stand at the show and from the environmental focus of Japanese manufacturers.
     This is also going to be a really good show for digital printing since many of the digital press manufacturers are based here and because the best finishing and binding equipment for digital print is being manufactured in Japan. In a country which is perhaps the biggest per capita user of print and also one of the biggest users and developers of new media and electronic gadgets, it is quite likely that many of the directions of where print can go will be examined and settled here. There will also be a special area where tablets and other futuristic media are shown.
     The Tokyo Big Sight location has not been affected by the earthquake and tsunami and there is no problem in terms of installing and running heavy machines or any other safety issue. Although Japan is returning to normalcy each day (yesterday the tuna auction in Tokyo was again opened to the public) the IGAS exhibition will economise on electricity as a part of the on-going daily national discipline.
Naresh Khanna

Saturday 25 June, 2011

Can we emerge from the chaos?


Govt bans plastic sachets for gutka, tobacco

With the Supreme Court taking an active position on use of plastics for packaging, the environment ministry banned the use of plastic in packaging of tobacco goods on Monday 7 February 2011. The ministry’s order, which also bans the free distribution of plastic bags by shopkeepers to their customers, is likely to most deeply affect the gutka, pan masala and other tobacco products industries that are sold in small sachets. The environment ministry’s decision came as part of new rules under the Environment Protection Act, 1986 to regulate use of plastic waste.

As usual in our country things are mixed up. In this case the tremendous occurrence and increase in mouth cancer caused by chewing gutka and pan masala and other tobacco products is being mixed up with the need to have legislation and enforcement on the use and recycling of packaging and all other forms of waste. Both the health and environment problems are huge.

The so-called solutions are also most likely band-aids for a deeper systemic problem with our polity and society. Why does it take a Supreme Court order to implement rules which were proposed by the Environment ministry in September 2009? On 2nd February 2011 the Supreme Court ordered  the government to notify the rules by the deadline it had set in December 2010. The bench headed by Justice GS Singhvi warned, “You [the government] would violate the court’s order at your peril.”

The ban does not completely ban plastic bags as some of the northern hill states have already done on their own. The new order only tries to regulate and limit their use. According to Minister of Environment and Forests Jairam Ramesh, “It is impractical and undesirable to impose a blanket ban on the use of plastic all over the country. The real challenge is to improve municipal solid waste management systems.

Of course, this makes the much in the news minister sound very modern and sensible. The question is whether we are really going to become more sensible and modern? How are industry and particularly the plastics and packaging industry going to respond? In my view, all of us need to take concerted action, citizens, consumers and industry. We cannot leave plastic recycling or any other type of waste handling to the government alone. We should be ahead of the government. And not continuously be in a position where our lack of consensus and action requires the Supreme Court to tell our government or us, what to do.                            
 Naresh Khanna (February 2011)

Kasturi and Sons


The issue is transformation in the face of competition and change

Excerpt from paragraph 8 of the CLB order of 20 May 2011 by Judge Lizamma Augustine.

“The far reaching consequence of the proposals is that a shareholder of the company will be perpetually debarred from holding the post of editor of The Hindu, which in my view is contrary to the tradition and practice followed by the company since its inception. Besides, it is doubtful whether the proposed advisory board which consists of members of the rival groups would be able to effectively guide the non family editor in discharging his duties. I am of the prima facie view that except ‘the wholesale removal of the family editors’, the present proposals do not take in any other aspect. The board had not addressed the aspects (retirement entry and exit norms etc), referred to in my earlier order. It also appears that the Board has given a go by to the idea of framing guidelines for succession or rather they have limited the directions of the CLB only to the extent of removing the entire family editors.”

It is not easy for us to add anything sensible to the dispute amongst the owners of the company that publishes The Hindu and Businessline daily newspapers, and the periodicals Frontline and Sportstar. Nevertheless as usual we tend to barge in where angels fear to tread. The dispute has been covered in the daily press which in India is generally loath to write about each other’s problems — most notably and in the main quite respectfully in Business Standard and The Mint. However the headlines and slugs have included, “Family Fight’, ‘Family Matters,’ ‘The Hindu battles to transform.’ Expressions such as 'beleaguered' have also been used.

We agree that the discussion, dispute and even the court cases are about change and transformation of the reputed family owned newspaper. The main issue is who will lead the transformation of the third largest circulated English daily in the country. The transformation is necessary if the The Hindu is to stand up to Bennet Coleman’s Times of India which has already made an impact with its Chennai edition and will soon add to its South India campaign with three new editions in Kerala in cooperation with Mathrubhumi. Meanwhile The Hindu continues to call itself India’s national newspaper without having editions in the major metros of Mumbai and Kolkata.

Transformation goes beyond new editions or contemporary design — it implies innovation, futurism and the building of a new publishing paradigm which turns several technology and media threats  into a cross media opportunity. The organisation has a very strong production infrastructure which  is wasted on a paper that is crying out for editorial innovation and juice. The professionalisation of the paper’s editorial, design and business functions is overdue and cannot be limited to one appointment, albeit even the first non-family member to be appointed as editor. Transformation will require many steps which have been stayed for a variety of reasons not by the court but by the dysfunction and inability of the owners to congenially map out and implement the plans for change.

It is apparent that in the Kasturi and Sons dispute, one side believes that only they can lead the transformation. This side not only wants to professionalise the paper but also wants to retain some kind of editorial control — ideological and political. Currently enjoying a majority of 7 to 5 on the board, this rival group wants to get rid of N Ravi and Malini Parthasarathy on the editorial side and is largely using the appointment of a professional editor as an excuse to deprive Ravi and Parthasarathy of the responsibilities and power that would have naturally and sequentially come to them as educated and experienced editors as well as part owners of the group’s publications.

While the Company Law Board in its order on 20 May 2011 gave relief to N Murali and restored his responsibilities as Joint Managing Director, it has postponed judgement on whether the 7 to 5 decision of the Kasturi and Sons board to throw out all the family editors including Ravi and Parthasarathy amounts to oppression and whether a special resolution calling for more than a simple majority is needed. The real issues are of editorial control and of who leads the transformation and who ultimately wields power in the process of the company’s growth as a newspaper business. Put simply, transformation may mean taking on Bennett Coleman and bringing in new investment. At this juncture, it may behoove the owners of Kasturi and Sons to remember that newspaper owners have to choose between fame, power and wealth. According to a sage editor, newspaper owners can aspire to any two of these at best, but not all three. 
                                  — Naresh Khanna (June 2011)

Three things I learnt last year


I am currently traveling in Germany for interpack and to the manroland open house in Offenbach for sheetfed offset printing. Although like most of the newspaper industry, I am extremely curious about what will happen at the board meeting of Kasturi and Sons in Chennai on 20 May, I will wait till that date to comment. Mint, among other papers, has carried detailed reports about the change an d no change at one of the oldest papers in the country.

In the meantime, let me relate what I have learnt from three young printers in the past year, although to some extent I may be repeating myself. But then when does one really have something new or useful to say to one’s readers? Ship it out if you want to make a profit The lesson that I learnt from Amit Tara last year while riding on a train from the NEC back to Birmingham was that there is no point in buying more presses unless you can fold, bind and trim the work, despatch it and bill. It’s terrible to have a pressroom clogged with stacks and pallets of printed sheets going nowhere. Tara has been working hard on his mission of acquiring and installing au tomated postpress and binding equipment at his Noida plant, and we hope to revisit him soon.

Profit without cutting corners
Nitin Shah is also a commercial printer, whose motto is working smart to profit — without cutting corners. He told this to me in his brand new environment friendly plant in one of the scenic and modern industrial estates on the edge of Pune. Nitin’s domain knowledge of paper, digital and offset printing and postpress is based on a good bit of experience, but he is marketing lead. He is able to combine digital with offset in a very canny way to provide leading brand owners a one-stop shop. For jobs with bigger sheet sizes than his own new Heidelberg PM74, he outsources the print but keeps the postpress under his total control in his own plant. He is also adept at ordering paper in appropriate sizes to avoid trim wastage.

Excellence and speed
Asked at a recent seminar in Delhi by Pranav Parikh about what she brought to the family business when she joined it, Priyata Raghavan said she ha d to fight for both excellence and speed when she came to work and provide next generation leadership at Sai Security. The lesson is that excellence and speed are simultaneous — slow work and less action do not add value or make for excellence in the production process. In this spirit, Priyata was a key decision maker in buying two label presses simultaneously for the Faridabad and Bengaluru plants. It was the same attitude and tone of voice when she confidently pronounced that the hardware from the old plants would be dismantled and reinstalled at the new factory in Faridabad in 30 days.
  Naresh Khanna (May 2011)

Upselling print


Frankly to me, the word upselling sounded like a marketing hype. I heard this expression when IppStar did its digital printing and transpromo conference in December 2009. Cross-selling and upselling was the way that digital print companies talked about leveraging customer information to sell more to the customer or to sell new products that they could anticipate by looking at and analysing a customers' profile and behaviour.

Then came the expression of value added printing. To some extent, this sounded like marketing hype from press manufacturers such as manroland in order to sell coaters and foilers, and new techniques with their multicolour presses. However, if I look back at the leading printers, such as Pragati, what have they been doing? They have been adding value with special prepress in order to use UV coating techniques for special effects and textures that enable print to have a ‘wow’ factor.

Pragati has certainly created a differentiation within the market – it is competitive on ordinary jobs but it can upsell – the company can transform a piece of paper into an object of desire.

The interesting thing is that this does not apply to all customers and all products, but the number of both customers and products which demand the differentiation is increasing. And is far more than the number of commercial printers who are willing to invest in these technologies. By the way, the same thing will happen to digital printing when a digital press can produce textures or ‘dimensional’ print.

Look at newspapers going from black and while to colour and look at textbooks going from black and white to colour. This is also a form of upselling with the realisation that the market wants colour. The ad revenue for newspapers or the price of a textbook only doubles with 4-colour printing versus black and white. Although you need four times as much heavy metal, plates and ink but only the same amount of paper. In these two situations, survival depends on upselling colour.

If print is going to compete with television, internet, cell-phone and the iPad, colour is basic. In fact, print will also have to compete in terms of interactivity. And this is where cross selling may also happen. For instance, when we sell a banner ad on our website or in one of our two weekly newsletters, the readers can immediately click on that ad and reach the advertiser. The same click could also bring up a second pop-up selling a related product.

Print, too, can be interactive. As an example and as an experiment too, we have had a tie-up with a fascinating company called Adorai for past eight months which allows a reader of our print magazine to simply sms the article to any email address. We could use this to evaluate which article is interesting to readers for sharing with their friends.

In the future our advertisers could use a similar code in the print ads so that our readers can get an instant response from the nearest salesman for the product advertised. This infrastructure is already built by us, and it can make print more interactive. We only need to learn how to upsell. The next step will be to cross sell.
Naresh Khanna (March 2011)

The larger Indian newspapers from the production point of view


The still fast growing newspaper industry in India is apparently unique in its behaviour. Whereas in trying to understand the entirety and variety of newspaper publishing, I recently described this behaviour as complex, many others actually see it as fairly structured and not so complex.

Ten years ago, from the production point of view, we used to think that there were only ten large newspaper groups in India and at most these would grow to about 20 with the inclusion of the major vernacular dailies in addition to the major English language publishers. We did not reckon on various factors such as several regional groups going national —­ such as the Deccan Chronicle group or the Dainik Bhaskar group. We did not think that so many new newspapers would start up and survive. And above all, although it was theoretically possible and the numbers were staring us in the face, it was difficult to grasp that the vernacular dailies would grow as fast as they have. We also underestimated the unlocking of value that is possible by throwing newspaper ownership open to public investment and to foreign direct investment.

One of the reasons that our perception of the future was a bit clouded was that we looked at growth from the production side and for us a large newspaper group meant one that needed or could afford to buy an imported 4 x 2 press for printing 70,000 copies an hour. We underestimated the vernacular publisher’s ability to leverage the digital infrastructure and to use it to capture newer cities and towns with numerous printing plants based on ever-improving and very affordable 2 x 1 presses. The fact is that 4 x 2 presses are very expensive to buy, install and operate for newspapers that need to print only 150,000 copies from a single centre and that too with many edition changes.

Fortunately for Indian newspapers the 4 x 1 presses (four broadsheet pages across and one around) were developed and have been much cheaper to buy and to operate. Apart from a smaller capital investment, they require less space and for our high number of localised edition change, since only one plate needs to be changed instead two, are economical in operation. Colour and the expansion of colour pages also become a natural and more tractable proposition.

Five or six years ago, experts in the industry estimated the demand by Indian dailies for approximately two hundred towers in the 4 x 1 format — provided the price was right. In the past five years, eighty 4 x 1 towers from manroland, Goss, KBA, Mitsubishi and Seikan have been installed in Indian newspaper plants. And another 45 are already on order from Manugraph, manroland, Seikan and TKS for installation by 31 March 2012.

Two things have improved the prices of 4 x 1 presses for Indian publishers — Firstly, the contraction of the newspaper industry in the developed countries since the financial crisis of 2008 and the increasing preference for new digital media. The second is that Indian newspapers have inspired several manufacturers to make this new configuration machine for the first time — and provided that the price is right, they have been ready to be the first customers of these new presses. In one case, an existing manufacturer of a 4 x 1 has come up with a new idea for making this format work more economically in Indian conditions. By encouraging innovation and willingly becoming the testing and proving ground, Indian newspapers are driving the 4 x 1 press market that will benefit newspaper publishers around the world.

Looking at newspaper growth from the 4 x 1 production point of view, it now seems that number of Indian newspaper groups that will need these presses is not merely 20 but more likely 40 to 50. This growth will happen most likely in the next five years as the competitive action shifts to the vernacular dailies. Consequently the demand for 4 x 1 towers by Indian newspapers will have to be suitably revised.
                                    —  Naresh Khanna (February 2011)