Can Transcon transform newspapers?

Transcontinental Inc.’s vision for transforming the North American newspaper industry will get its first test later this year when the company starts up innovative presses in San Francisco and Montreal. The bold model could shake up parts of the commercial-printing industry as well, but the Canadian printing company is apparently having second thoughts about the plan.

Transcontinental’s new San Francisco plant and expanded Montreal plant will have at least three features that set them apart:

1) The ability to do both heatset and coldset printing on the same presses. The presses will be able to print standard newspapers, higher-quality newspaper inserts, and various commercial products on a wide variety of papers including newsprint, supercalendered, and coated grades. Though a similar press is running in Germany, this will apparently be the first use of the combined heatset/coldset approach in North America.

2) The printing of newspapers by a commercial printer rather than by a newspaper publisher. Most major newspapers in the United States do their own printing or – in a few cases like USA Today and The Wall Street Journal – contract it out to other newspaper publishers. In contrast, virtually all U.S. magazines and many European newspapers use commercial printers to print their products.

3) They are intended from the outset for the production of multiple daily newspapers from different companies. The typical U.S. daily-newspaper printing plant is built around the needs and schedule of the newspaper that owns it, even if it does work for other publishers or takes in commercial jobs.

Transcontinental has contracts to take over production of Hearst Corporation’s San Francisco Chronicle in the second half of this year at the new plant and to print a variety of daily and weekly papers, including The Globe and Mail, at its Transmag plant in Montreal. The struggles of the North American newspaper industry – which have fueled speculation that the Chronicle would abandon print altogether – have slowed Transcontinental’s vision of taking its innovative model to other metropolitan areas.

“We continue to have discussions with some newspaper publishers in North America,” says the company’s most recent quarterly report to investors. “However, given the deteriorating market conditions in this industry in the U.S. and the deteriorating financial condition of potential customers, and considering our model becomes much more compelling when it includes more than one paper in a given area, we do not expect to sign additional contracts in the near term. Over the longer term, we believe our unique model will help the newspaper industry overcome its challenges.”

The model is a far cry from the usual approach in the U.S. newspaper industry, where the typical daily newspaper owns its own press (or presses) that sits idle much of the time. Many a newspaper has tried to make money off that idle press by going after commercial work. But the lack of infrastructure (such as sales, estimating, and customer service staffs), high pressroom staffing levels mandated by union contracts, limited paper capability, and the relatively poor print quality have been hurdles to success.

A couple of European mills have manufactured coated coldest papers to help newspapers compete for commercial business. But the papers look more like high-quality newsprint than like coated products, and the printing has coldset’s usual lack of precision and detail.

Rapidly deteriorating business conditions have recently caused more newspaper companies to consolidate or outsource their printing, typically to a nearby newspaper with more modern presses. With ad revenues dropping faster than you can say Craig’s List, making deadlines a couple of hours earlier to save money on printing and paper suddenly doesn’t seem like a bad option.

The San Francisco plant will supposedly benefit the Chronicle by offering later deadlines, more color pages, and better quality than the existing 40-year-old letterpress-turned-flexographic presses can. Transcontinental, which has a Canadian publishing arm, has also expressed interest in beefing up newspapers with improved quality, such as by using supercalendered papers instead of newsprint.

“Newspapers must offer quality enhancements including brighter paper, more colour, better design and provide innovative advertising value such as scented paper, in-line coupons, pop-up pages, multiple gatefolds etc.,” François Olivier, a Transcontinental executive, told a newspaper industry gathering in 2007.

The San Francisco and Montreal plants are each getting three of MAN Roland’s Colorman XXL presses, which print blanket to blanket in a 6x2 configuration. The shaftless presses feature many bells and whistles, such as closed-loop color control, automated plate loading, and folders that can be configured for a variety of products. Transcontinental will also run the post-press operations, such as inserting.

Each of the San Francisco presses will be able to produce 48 broadsheet pages, 24 in four color. The three similarly sized Montreal presses will be able to print four colors on every page and will be rated at 90,000 tabloids per hour when operating in a “double” (that is, "straight" or two out) configuration, MAN Roland says.

The first printer to use MAN Roland’s hybrid press technology, Verlagsgruppe Passau GmbH (VGP) in Germany, reports that the ability to mix heatset and coldset in the same product has attracted additional advertisers to a newspaper it prints. (See Newspapers & Technology’s excellent interview with the two of the printer’s executives.) But it has also struggled with learning heatset; for example, it was surprised to discover that maximum ink densities varied by paper stock.

Transcontinental doesn’t face the challenge of learning about SWOP standards the hard way because it already has extensive experience with heatset web offset. And it should be encouraged by VGP’s report that its costs for heatset and coldset on the hybrid press are nearly identical.