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Sep 25, 2013 12:00 AM
Jim Hamilton, Sep 9, 2013
Shortly before PRINT 2013 Collins Ink Corporation changed its name to Collins Inkjet Corporation in a move that the company said reflected “Collins’ expansion into printer upgrades, parts, and support.” At PRINT 13 Collins made it clear exactly what it meant by that statement when it announced that it would refurbish Kodak Versamark equipment, beginning with Kodak’s 5120 and 6240 print heads. Readers will likely recall that Collins, formerly a close Kodak partner and ink supplier, severed the relationship in a contentious battle beginning in October of 2011. (See “Collins Ink Terminates Agreement with Kodak Versamark”.)
This move by Collins is an interesting one because it transforms a supplier of ink into something more, and it presents a competitive threat to Kodak’s large installed base of inkjet heads being used on press or in mailing/inserting lines. Keep in mind that for now Collins’ target is older Kodak inkjet heads and does not yet impact the more recent higher resolution Prosper Imprinting System heads. Also, Collins notes that it is not intending to become a reseller of any brand of inkjet and will maintain its supplier relationship with inkjet solution providers such as EFI and Xaar.
Collins noted that its new direction is a result of customer demand for continued support for Kodak’s legacy equipment, some of which has been in operation for over 20 years and continues to operate effectively, but needs refurbishment, particularly for the raster image processor (RIP) electronics and the fluid stations. Collins will now offer refurbishment, upgrades, parts, and service for some Kodak’s Versamark products. In regard to service, Collins is setting up a service organization that it plans to expand over the next two years. InfoTrends expects that Collins will target high-volume Kodak customers with large numbers of heads. Collins will also explore providing customer and support services for other companies’ systems.
The fluid station for these products houses the system’s RIP boards and the inkjet ink conditioning. These elements are critical for the smooth operation of the print heads. These electronic components are aging and Collins believes that many Kodak customers are looking for alternative sources to keep their systems operating effectively. While the initial target is Kodak 5120 and 6240 heads, Collins expects to be able to refurbish Kodak DH90, DH91, and 5300 heads before long. It will also begin installing upgraded 6240 fluid stations by the end of 2013 and is in the process of developing its own proprietary RIP boards.
It is important to keep in mind that Kodak’s customers are at the core here and are expressing a need for continued support for their aging systems. With this program, Collins is attempting to address that need. This presents Kodak with a competitive threat, but it also raises other questions. For Kodak, the key question is what can it do to protect its installed base? The long viability of Kodak’s Versamark legacy technology is laudable but in addition to attempting to move customers to newer platforms, Kodak needs to present its customers with attractive upgrade and refurbishment offerings or else risk the loss of this important installed base. Other companies have developed strategies to manage the cash generation capabilities of mature digital systems. Kodak needs to do the same. For Collins, this initiative expands its traditional role. Can it manage this expansion across various products and regions?
For customers weighing their options, the news should be welcome in part because it extends the life of a reliable technology, but perhaps more importantly because it adds creates a market face-off that has the potential to provide them with the supplies, upgrades, and service they need at competitive price.