Global market blunts razor-and-blades model
Prices for printer ink have been slashed by up to 70 percent as manufacturers struggle to get to grips with greater competition and more price-aware consumers. The most dramatic price cuts are so far affecting only regional markets, but insiders believe it is inevitable they will spread worldwide, shaking the $100bn-a-year imaging supplies business to its foundations, and bringing huge savings to heavy printer users.
Printer buyers all over the world are becoming increasingly aware that cheap inkjet printers – from manufacturers like HP, Epson and Canon – do not equal cheap printing. “We stopped using the printer when the ink was finished at New Years. New ink would have cost us as much as a new printer,” complains dissatisfied printer buyer, Don Martinez.
Inkjet sticker shock
“I got the printer mostly for my granddaughter to do homework assignments, but we did want to try it out. We printed up some photographs and internet pages, maybe too many,” California resident Martinez admits. Shockingly soon, he says, one of the printer's ink cartridges was empty, and it refused to continue printing until a new one was inserted. The next shock for Martinez was the cost of a new set of ink cartridges: more than $50. The Epson Stylus printer had cost $60 after a rebate.
“I feel almost like it must of cost a dollar for every page. I truly had no idea,” says Martinez, “I could afford to replace that one cartridge, but then another will be empty soon.”
Martinez, who describes himself as “not very technology-focused, not a cyber person”, had just been burned by one of the most profitable marketing concepts of modern times – the razor-and-blades model. Printers are sold cheap, to attract shoppers; but ink is expensive, to make a profit.
Like printing money
“A company sells a $100 ink jet printer and loses $30 or $40 on the sale,” explains Charles LeCompte, president of printer research firm, Lyra, “but every few months the consumer buys a new cartridge and the manufacturer makes ten dollars or so.”
“After 199 days, profit from the cartridges has made up for the loss on the printer, and after three years, the manufacturer has run up a tidy $160 profit.”
It's a neat little routine that has helped the imaging business increase sales steadily to $160bn a year worldwide. More than two thirds of that comes from supplies like ink and toner.
Consumers have had enough
But there's a big problem at the low end of the market. Consumers have stopped following the script. Deterred by sky-high ink prices, they're not printing enough – and printer makers are worried.
“For years, the high price of inkjet cartridges has kept consumers from freely using their printers,” admits Antonio Perez, Kodak's Chairman and CEO.
At the same time, 75 percent profit margins on ink have attracted a horde of so-called 'aftermarket' suppliers. These companies make compatible ink cartridges, and sell them at least 30 percent cheaper than the original printer maker.
If a customer doesn't print as much as expected, and then buys some cheap clone ink cartridges, the impact on printer makers' profits can be devastating. The printer maker might need to wait more than a year just to break even on a $50 printer sale, says Lyra's LeCompte. The lifetime profit from the printer could be cut in half, or worse.
“That's not enough for the overall business to be profitable. The razor-and-blades business model is broken,” he says.
Ink: 70 percent off
The first signs of real distress from the traditional printer industry are coming from Asia. Consumers in developing nations are especially price conscious, and clone cartridge makers there are strengthened by weak intellectual property rights enforcement.
Epson is now selling printer ink in Asia at just one third of US or European prices.
The company is strongly promoting its C58 and ME 2 series of printers as being the cheapest to use in Asia's developing markets, such as China and India. Lyra estimates their cost per page at around half that of printers from HP and Canon. A full page black and white print costs as little as 1.5 cents (US$0.015), according to data from Epson China. A color page costs less than 4 cents.
“If Epson succeeds [in Asia], HP and the others will have to copy Epson's strategy and offer very cheap consumables or abandon the market,” predicts LaCompte.
Cheap ink planet?
But Asia may be only the beginning, Lyra researchers say. “Epson has started a fire that will probably spread beyond China, and probably beyond the entry level ink jet segment,” LaCompte believes. “China is not the only country where consumers are thrifty. Even in rich America and Europe, consumers endlessly tell us that they are annoyed with the high price of cartridges”
LeCompte describes Epson's new strategy as “a brilliant counterstroke”. However, from the imaging supplies industry's standpoint, he says, it is “a calamitous development that will portend years of struggle, and adjustment to a new way of doing business.”
“This process won't happen overnight, but as vendors come under increasing competitive pressure, one will break ranks and move over to the Epson strategy. Like bulkheads on the Titantic, market segments and countries will burst one after the other as the pressure increases. And in the end, we think the consumables margins that the industry enjoys today will disappear from all but the most protected market niches,” he says.
Kodak starts the revolution early
Just a few days after LaCompte discussed these forecasts, Kodak announced that it plans to break into the global consumer inkjet printer market with half-priced ink cartridges.
“We are changing the rules in this industry to ensure that consumers can affordably print what they want, when they want,” said Kodak CEO Perez, in an announcement that appeared to herald the start of an ink price war.
Hinting at the size of the battle that is brewing, Perez attributes a large part of Kodak's New Technologies division loss of $211 million last year to the new printer project. Nor will the battle be a short one, Perez told analysts he is uncertain how soon Kodak can reduce these losses, which reached $71 million in the last quarter, given the need to take market share from entrenched rivals.
maybe they should abandon consumables
Maybe they should just stop selling ink... :)
Razor-and-blades model isn't inevitable, Do car makers sell gas? Do fridge manufacturers sell food? do toilet manufacturers make toilet paper? Thankfully, they don't :)
Maybe greater consumer awareness is making the basic razor-and-blades model less effective?
HP
Whats this going to mean for HP. HP can't cut catridge costs as much
Why not? They have sky high
Why not? They have sky high prices for HP ink too. They are making tons of money on thier ink.
Cry me a river
Poor, poor HP. Their executives are raking in millions, buying mini-mansions in Cupertino, and spying on journalists.
Maybe they deserve to make a bit less money for a while. Or at least to work harder for it.
Any business that is a license to print money is a business that needs to be challenged, so consumers will not continue to get screwed.
HP shuts down ink too fast
After my Windows driver started complaining there was no ink left and refused to print I resumed printing in Linux. There I could print for almost a whole pack of paper until finally running out on ink.
HP wants us to change ink as soon as possible and that's no secret. Dig up the internet for "hp 840 printer ripoff". You'll see what I mean.
Ink is like gold
Jomiamiusa I was paying $30.00 for the hp45 every 2months untill I found this guys. I did 4 or five refills ( my neighbor too) and is amazing ,clean fast easy.
www.ezinkusa.com
ink is ink right ?
Price seems to be the most important thing, but what about colour matching, print head life, etc ?
Different inks = different results, different chemistry, different drying times, etc.
The gamut on a refill cartridge is highly unlikely to be anything like the original.
That said - drivers skew everything anyway.
Sod it - I'll stop printing until I can get a memjet.
PS: Mark Hurd appears to have enough money.
Expensive Cartridges
It seems that the manufacturers of printers like to keep changing the cartridge so the aftermarket can't get enough volume to really compete with them.
At present the only defense is refilling.
Maybe the Memjet will help?
Rich
For black and white I
For black and white I recommend some of Brother's laser printers. They're pretty cheap compared to current inkjet models.
Kodak printer ink is half the price
I've just bought a Kodak printer, scanner, copier and the ink cartridges are very reasonable, only £15.99 for a black and 5 colour ink cartridge pack, compared to £60 for a set of inks for my old HP. That's not all, I've been using them for 4 weeks now and they are still going strong prinnting photos and documents with over 2/3rd left.
I did pay a bit more for the printer but reckon I've already saved the difference on ink!
Looks like the end of the old razor and blades model - has anyone thought of doing this for razor blades i.e. making a razor that costs £30 and charging £0.50 per blade? I'd buy one!
Kodak supplies
Kodak seams to be off to a good start with their 3 Easy Share printers that were released this year. The cartridges are good size, 12ml for the black and a whopping 50ml for the black /color combo cartridge. The OEM supplies are very reasonable and after market supplies are less expensive still. If Kodak gains acceptance with consumers, it could very likely change the business model of the industry. I will be interested to hear more feedback from users in the coming months on functionality and durability. -Bob
Printer ink costs approx.
Printer ink costs approx. $8400. per gallon. That is ridiculous!
Ink Cost
The ink can vary in price depending on the make and model of the cartridge. The range can be $.27 to over $3.00 per ml (millileter). Most people never look at the cost of supplies before they buy a printer. -Bob
ASAP Inkjet Cartridges
Original Ink
I agree with all the people that sent the messages about the greed that these companies show, it is incredible that they have gotten away with this plain sight robbery, I refuse to pay full amount for the cartridges, I try to buy the refill kits, and or buy a different (cheaper) ink, although sometimes the printer refuses to work because it doesn't see the original cartridge.
I know that there is a way to fool the printer to believe that the cartridge is the original, but I forgot how to do it, does anyone know how to do this, it would be greatly appreciated if you could post it.
thanks
SSC Service Utility for Epson cartridges
"SSC Service Utility allow you to do many amazing things with Your Epson printer :
1) Work directly with CSIC in Epson Stylus printers cartridges.
2) Reset or rewrite any chip using special addon device.
3) Freeze internal ink counters.
4) Reset internal ink counters even with empty cartridges.
5) Separate cleaning of color and black heads for all Epson inkjet printers, powerful cleaning mode.
6) Hot swapping of cartridges supported.
7) Resetting of protection counter (even then it is already full).
8) More then 100 different Epson printers supported
it's free...
http://www.ssclg.com/epsone.shtml
i have a lexmark Xxxx all in
i have a lexmark Xxxx all in one(inkjet). it's printing cost is very high. so tell me
any trick for this one.
Well I can only hope for the
Well I can only hope for the best here, once again the IT world made a step forward. We will have much more cheaper ink but will we have the same quality? I sure hope so because quality interests me more than quantity when it comes to printing. I currently have a cheap laser toner and I only have it because it also provides me the quality I need so this is a good deal for me.
these companies are plain greedy
Yes it's so true that these companies are plain greedy for requiring original cartridges on their printers if you'd like it to be of high quality. Moreso devious is how some printers not being able to function unless an original cartridge is installed. In the second scenario, which happened to me, what happened was I still utilized the original cartridges but had it professionally converted to use a continuous ink system. That way, I'm able to save on unwanted costs in the long run, while at the same time am able to fool the printer into thinking it is using an original cartridge.
ounceofgold.org/gold-price-today
What with photo paper?
Everything nice, but what about printing photos? How it's working with photos? And the cost of printing photos?
So two years on from the
So two years on from the original post and what's happened. Not a lot!! Prices of originals are still sky-high and the compatible cartridge market continues to boom. And of course the printer manufacturers continue to rip us off. How much longer are we going to have to wait
Your not just buying ink
When you buy a print cartridge you're not just buying 10 ml of ink, so comments like "that's $8,000 per gallon!" are meaningless. Each inkjet cartridge has a micro-machined, many-nozzled printhead that has to function at high speeds, with great precision, and under messy conditions. Each nozzle opening is about the thickness of a human hair and has to dispense precise droplets of ink, each the same, at rates of around 1,000 droplets per second. Do you think this stuff is cheap or easy to make? It takes a massive, high-tech infrastructure. I'm not saying that these companies aren't making a profit on the cartridges, but let's not oversimplify or exaggerate.
I'm afraid you are not
I'm afraid you are not completely right on this one. Print heads alocated on the machine not the cartridges. The cartridges are merely a small ink tank which stores ink. It does have a few 'micro machines' which are the now-dirt-cheap IC micro chip that stores information of how much ink is used or left. Even small third-party cartridge mamufacturers can make them easily.
It is however the 'secret reciepe' in the ink's composit that make the genuine ink unique and valueable. Yes they've invested big money into developing new chemistry to get better printing results. But the $8,000 per gallon allegation is still close to truth. EPSON, CANON, HP and the like are really ripping people off by selling their genuine products at sky-high margin. It's a market with little competition - if you want quality, you need their ink, there is no arguments here. So this is a monopoly that is hard to break, unless someone in the industry starts a revolution, and change the game. This is against their own interests since the current status-quo is best for them. Lets hope something happens - especially in this era of economic down turn when consumers are more cost-concious. Once the 'prisoner's dilemma kicks in some big change may happen. Just like the D-SLR market. Lets hope so.
Type of Ink
What is the ink that I must use for Canon BJC 210 SP?
Ink Cartridges for Canon BJC 210
Your BJC 210 printer takes the following ink cartridges: For the black cartridge: BC-01 / BC-02 For the color cartridge: BC-05 Some of the best deals for these cartridges can be found online. I particularly use this printer ink online store for Canon and Brother ink cartridges. Any questions just reply back
criminal
I believe that the behavior of the printer manufacturers is criminal. My hp printer will only recognize genuine hp cartridges. It also has a date code stored on each cartridge and the machine will refuse to run that cartridge after that date code expires.
They are forcing you to replenish ink at a maximum interval and you can only buy from them. If you think that is okay then you will not mind if Gm and Ford start making cars that will only use their brand of oil or tires or wiper blades. The reason that they don't is because it is illegal. The law requires that if they stipulate that you use their brand then they have to furnish it free.
These inks should be open source available from any manufacturer who wishes to manufacture that ink at whatever price they can do it for.
Do something. Check consumer protection laws in your state and locality. Maybe there is a statue somewhere that can be used to sink these bastards. Also write your congressman and senators. It is time for these companies to play fair.
Toner
Let me be the first to say, that I happen to sell toner. We offer compatible and any other brand that is OEM (HP, Canon, etc). HP does jack up their prices, in turn vendors (resellers) can only flip it for 1-3% to companies. On the other hand, a normal consumer walks into staples, who marks it up 25-30% easily. HP will never change this, their prices actually go up about 8% every quarter. Compatibles are the way to go, and I know some of you are saying they will not work in your HP printers (deskjets I am guessing) and to be honest, I don't know what to say. Compatibles a couple years ago were only 10% of the market, they are now 30% of the market. As the compatible toner market continues to grow, I think HP will HAVE to bring down their prices to regain business they lost. I would stick with compatibles if at all possible, most places offer a 100% gaurantee on their products, we do at least.
imdata.com
Expensive ink, cheap printers
For years I have just bought a new printer when the cartridges ran out. A printer is cheaper than the cartridges in it. Just check to ensure that you don't get small capacity original cartridges. I know this is not environmentally sound but it sure helps my pocketbook, and I always have a new printer with nothing to clean, etc.