H-P: Why Our Ink Is Expensive

Ink Cartridges — Wed, 16 Jun 2010 12:20:57 +0000

Tired of hearing customers whine that printer ink is too expensive–and facing competition from ink-cartridge refillers–executives at Hewlett-Packard’s printing division would like to buff up the print giant’s reputation with consumers. So the company recently sent Thom Brown, who specializes in “competitive media intelligence,” on a media tour with a presentation called “Why Does Ink Cost So Much?” Opening a bag of props including a trio of shot glasses, squares of foam and some disassembled print heads, Mr. Brown earlier this week explained the complex workings of H-P print heads, and the billions of dollars the company has spent over the years developing them.He talked about the challenges in shooting drops of ink at moving pages of paper, and the perils of refilling ink cartridges rather than buying new ones from H-P. Refilling involves poking a hole in an H-P cartridge and filling it with a god-knows-what mixture of non-H-P ink–a process that can lead to smudging and other poor performance, Mr. Brown said. H-P, he added, has heard from plenty of customers who tried refilling. “A lot of them don’t have good experiences,” he said.

In addition to research-and-development, the expense of ink cartridges comes from H-P’s high-tech testing of cartridges that break. The company uses electron microscopes, Mr. Brown said, to figure out what made a printhead malfunction. H-P has started what it calls an “Ink Amnesty Program” to bring back customers who have left H-P for refillers. In exchange for sharing your bad-ink story, the program will give consumers a 20% discount coupon for H-P ink.Of course it’s not just R&D that makes H-P’s ink costs so much. With more than 40% of the worldwide printer market last year, according to research firm IDC, H-P doesn’t face serious competitive pressure that would force it to drop prices.

Mr. Brown said his area of knowledge is printing technology, not profits.
But in the company’s last quarterly earnings report, H-P’s printing division booked more than $6 billion in sales and more than $1 billion in operating profit. Its operating profit margin was 17%, but Shaw Wu, an analyst with Kaufman Brothers, said that includes sales of low-profit printers. On ink alone, he estimates that H-P’s margin is somewhere between 20% and 30%.

Via: blogs.wsj.com

Rugby League star admits ink scam

Ink Cartridges — Fri, 21 May 2010 12:51:09 +0000

Gareth Raynor, a professional Rugby League player, has admitted running a printer ink cartridge scam worth nearly £40,000 from his home.

He pleaded guilty at Hull Crown Court to 14 counts of counterfeiting and one count of fraud and was warned by Judge Roger Thorn QC that he could face jail.

Raynor, a former Great Britain international now playing for Crusaders, sold ink cartridges on aution sites such as eBay through a company called Genuine-Ink.

However, the cartridges were filled with low-quality ink and sold in packaging bearing the brand of printer manufacturer Epson.

An Epson spokeswoman told Web User: “We would like to thank the law enforcement agencies for their significant support and the effort they have put into resolving this case. We take infringement of our intellectual property very seriously.

“Epson’s printers and printer driver software are designed to provide optimum performance together with genuine ink and media. That’s why Epson recommends the use of genuine Epson products in combination,” she continued.

Former Great Britain coach Brian Noble attended the hearing where Raynor admitted the offences but denied that the scam was worth over £100,000, as the prosecution had alleged.

Raynor will be sentenced at a later date.

Via: webuser.co.uk

Refill Ink Cartridge Instructions » printer ink

H-P: Why Our Ink Is Expensive

Rugby League star admits ink scam