"Kodak decided to get into the inkjet printer business for the first time (not counting a joint venture with Lexmark a few years ago). And to drive the point home, Kodak decided to turn the razor-blades model of printers and cartridges on its head. Kodak’s printers cost a little more — but the ink, according to Kodak, costs half as much as Hewlett-Packard’s.
Kodak points to the H.P. news release that landed shortly after Kodak’s new strategy was announced. H.P. was announcing a new ink-pricing strategy.
“See? We forced your hand,” says Kodak (I’m paraphrasing here).
“Nonsense,” replies H.P. “This is a massive cartridge packaging, labeling and numbering reorganization that we’ve been working on since 2004.”
The thrust of H.P.’s new pricing scheme is that starting with its spring 2007 printer models, each ink will be available in two cartridge sizes: standard and XL. The smaller size will cost less than H.P.’s current cartridges, but also contain less ink.
H.P. says that by lowering the upfront cost, the new “standard” cartridge will benefit people who don’t print much. And yet, as Kodak points out, H.P. has actually managed to increase the ink’s cost per page.
H.P.’s new XL tanks, on the other hand, hold three times the ink of the standard ones — but cost twice as much.
So now, given all of these twists, here’s the 64,000-liter question: Do Kodak’s cartridges really save you money?
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If you trust the study, then, it seems clear that the Kodak will indeed save you money on ink, sometimes a lot. You’ll have to weigh that advantage against some of its drawbacks.
For example, the Kodak is the new all-in-one on the block, so it doesn’t offer as many features as some of its rivals. For example, it can’t print directly onto blank CDs, scan slides or connect to a network.
So no, the new Kodak doesn’t run away with the crown in every department. But it easily holds its own against much bigger, more experienced manufacturers. And it has its priorities straight: great-looking photos that last a lifetime; easy-to-use controls; American-based toll-free tech support; and speeds and features that are no embarrassment.
More important, it makes a world-rocking point about the razor-blades model that’s lined the coffers of the inkjet industry for years. If you’re mad as hell, you don’t have to take it anymore.
1 comment:
Relating to our discussion in class today about the durability of goods, it seems to me that Kodak is banking on what they see as the durability of their printers in the printer market. While they are charging much less than HP for ink, they must believe that people will hold on to Kodak printers long enough that the quantity of purchases of ink cartridges from Kodak will make up for the lower price they are selling for. I wonder if the higher price that Kodak is charging for their printers is an indication to consumers that the quality (hence, durability) of these printers is better than HP or other printers. If so, then consumers who print alot (i.e. me and probably other college students would be better off with the slighly greater fixed cost of a kodak printer followed by lower variable costs of ink cartridges for the life of the printer. This battle between printer companies seems interesting in its relation to concepts of durability that we discussed in class today.
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