Is ink overpriced? Or are printers underpriced?
"The industry figured out years ago that once people buy a printer they are committed to it, so you can sell the printer at or below cost knowing they will buy the cartridges," adds Charles Lecompte, head of Lyra Research, a market research firm. "We think they are selling the cartridges for several times more than it costs to make them."
Why? "Printer prices have hit rock bottom, and the manufacturers are trying to somehow make up for the money they are not making from the hardware," says Seheje Saraphy, analyst at market research firm IDC.
HP says the reason for ink's high price is the cost of the ink technology itself. Aside from leaving a mark on paper, the ink has to remain unchanged in the cartridge for two years or more, and endure the heat and pressure of being shot through a microscopic hole in the print head after being heated suddenly to 300 degrees Celsius, explains HP's Brown. The ink must then travel the equivalent of a quarter falling 30 stories, hit the paper and not bounce, dry instantly, and not fade for decades. "It takes three to five years to develop one new ink formulation and a thousand prototype printers, since there are so many iterations in the process," Brown adds.
But Veneeta Eason, Kodak's director of future product marketing, sees HP's justification as a market opportunity for Kodak. "When we entered the inkjet market several years ago, we saw that the Number 1 dissatisfier was the high cost of ink -- printer prices were dropping while ink prices were going up," she recalls. So Kodak decided to offer printers that cost somewhat more buut with cartridges that cost less, largely thanks to the print head being in the printer rather than on the cartridge.
"The model works," Eason says, and Kodak has seen its inkjet revenue grow 39 percent year over year, according to its latest quarterly figures. (That said, keep in mind that Kodak has filed for bankruptcy protection.)
When it comes to usage costs, your mileage may vary
HP's Brown also makes the point that buyers should not pay attention to the ink's cost per ounce -- not just because it's unnerving, but because the total cost per page is a more useful metric. Anyway, of the major manufacturers, only HP and Canon list the weight of their cartridge contents, so you can't tell the per-ounce costs for most inks.
But all the manufacturers publish the expected page yield of their cartridges, online if not on the box. Buyers can use that data to help calculate the cost per page themselves and then decide how relevant the page-yield data is.
All the major printer makers use the ISO 24711 standard to establish page yields. The procedure is to install new, full cartridges and start printing out a suite of five documents until there is noticeable fading, or the machine announces that it is out of ink. The ISO suite consists of a business letter; a newsletter page with some text blocks with background color and a color photo that's smaller than 2 by 2 inches; two pages of large color charts and graphs, and a color registration page. According to Lexmark product literature, the ISO documents are designed to give each color 5 percent coverage, averaged across all five pages. If you are printing family photos, coverage may far exceed 5 percent per color. If you are printing emails, coverage may be lower and will mostly involve black ink.