Since the early 1980s the world has experienced the PC revolution, desktop publishing, print on demand, the Internet, mobile communications, and many other significant technology innovations. Throughout this period demand for paper has risen steadily with occasional bumps primarily due to short-term economic fluctuations.
Despite this steady growth, the printing, paper and printing equipment industries (offset and digital) have experienced challenging times, particularly over the last five years as the rate of growth has slowed. The last few years have been characterized by excess capacity, declining profit margins, and consolidation of the number of printers and suppliers. While there have been some bright spots such as digital color printing and printing in the home, these opportunities are much smaller than the areas that have been slowing down or declining.
The next 20 years will bring continued advances in technology and further changes in consumer, office worker, and publisher behavior in how they view, communicate, collaborate, process, promote, and store information. In virtually all cases the trend is towards more electronic and less paper.
20 years from now millions of people will still receive daily newspapers on the front step, read printed books and magazines, browse catalogs, receive bills in the mail, and print reports, spreadsheets, and presentations. In most application categories there will be more paper consumed than today. However, the percentage of people and the frequency in which they engage in these print-based activities will be smaller than today. Paper manufacturers in particular, but hardware OEMs as well, should bear this finding in mind in the course of any long-range planning.
Paper Manufacturers and Distributors
The overall market for printing and writing papers is mature, and technology trends are mainly opposed to its further growth. However, growth rates in population and the labor force with continue to boost overall paper tonnage. Also, despite rapid advances in technology consumer behavior tends to evolve slowly. As a result, the relatively low growth rates CAP Ventures projects will add over nine millions tons of new paper demand over the next 20 years.
Printing Equipment Manufacturers
Printing equipment manufacturers are operating in a similar environment, but have other options not fully available to paper manufacturers. For example, while the overall production printing market will slow over the next 20 years, production digital printing (especially color) will continue to experience above average growth.
The market for general office printing and copying is also mature, but continues to offer growth opportunities from a continued growth in the labor force and the migration to color technology over the next 10 years.
Finally, the home market will continue to absorb new printers, but they will mostly be lower-cost devices that are affordable for lower income households that are purchasing their first home computers. CAP Ventures expects home digital printing will continue to grow, but most of the total growth will come from new users rather than increased printing from existing users.
The preceding analysis is an excerpt from CAP Ventures’ Future of Paper multi-client study. The study provides a comprehensive assessment of U.S. paper consumption by key grades, end-use applications, and print environments. It includes extensive research with over 1,100 consumers, publishers, direct marketers, office managers, and print providers. The complete multi-client study is available immediately. To learn more about the study or to make a purchase, please contact Alison Hipp at , ext. 126.