Epson Stops E-Tailers From Selling Off-Brand Ink Cartridges
from the competition-would-be-bad dept
It's quite well known that the business model for ink jet printer makers is to sell the printers for next to nothing, and then make it up by charging ridiculously high prices for the ink cartridges. Of course, since this is the model they use, the vendors get mighty upset when they find out that other companies are selling replacement cartridges that work in their printers. In the US, that resulted in a series of lawsuits with Lexmark misinterpreting the DMCA to try to turn selling competing printer supplies into a copyright issue. Though it took many years, lots of wasted dollars, and probably frightened off many competitive sellers, eventually Lexmark was slapped down and told that it was misusing the DMCA. Meanwhile, other manufacturers are trying different intellectual property routes to stop real competition in the market. Just a few months ago, we noted that Epson was using patents as an excuse to sue a bunch of retailers. It appears that the strategy is working. Four online retailers based in Germany have all agreed to stop selling off-brand ink cartridges. To celebrate, I've just gone out and bought a bunch of off-brand ink cartridges for my Epson printer. This has absolutely nothing to do with "protecting" intellectual property -- and everything to do with shutting down a competitive marketplace.
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Go Laserjet
Sure I can't print colour, but we usually get our pictures printed at Costco anyway.
With the laserjet, my ink will never dry out (always happened on the Lexmark) and printing is super fast.
Plus I no longer cringe having to go back and pay $40-$50 every few months for another cartridge and pray I don't have to replace both the colour and the B&W cartridges at the same time. With our relatively low volume of printing, I'm guessing the toner will last me at least a couple years.
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An easy solution
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Re: An easy solution
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Re: An easy solution
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Re: An easy solution
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Re: An easy solution
I have been using and recommending Epsons for many years just because of the generic ink.
HP and lexmark have stopped generic sales many years ago.
Still available with Canon and Brother.
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For balance, the other side
The other side of this is the "one monopoly rent" argument. Basically, it doesn't matter if Epson gets you up-front with the printer or on the back-end with cartridges... either way you're willing to pay a certain total amount (total cost of ownership) for a printer and will consider the cost of ink and the machine when making that decision. The printer marketplace is competitive and if the total cost of one printer exceeds that of another (holding the quality constant) you'll choose the cheaper.
As the article points out, printer manufacturers sell their printers at a loss in order to get later sales on ink. If there is a completely competitive market in ink then manufacturers won't be willing to sell the printers below cost anymore. The result would be that the price of the original printer goes way up, and the price of ink comes down.
There is actually an argument (again, not saying that I agree) that consumers BENEFIT from this type of pricing. It allows somebody who uses their printer infrequently (and thus buys fewer cartridges) to have a lower total cost than if they had to pay full-price for the machine and still bought few cartridges. The consumers who use more cartridges cover the overhead (R&D, SG&A, etc) of Epson.
A lot of these arguments were hashed out in old patent "tieing" cases -- for example, the International Salt decision (332 US 392 -- http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=us&vol=332&invol=392 )
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Re: For balance, the other side
The manufacturers covered this angle by making sure that the infrequent user is also forced to buy lots of cartridges. The ink dries out over time and becomes unusable.
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non-oem inks suck
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Re: non-oem inks suck
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A different business model
Now, the question of better products available, that is an entirely different story, but this is an established business model, stop whining.
In some regards, this is a more fair pricing scheme. Everyone pays little to nothing for the ability to print, then pays for how much the actually use the product.
I love playing the Devil's Advocate...
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Re: A different business model
You're confusing two issues. First, it's perfectly fine to try to set up a business model like this. However, trying to stop competition is illegal. Just because you want your business model to work doesn't mean your competitors have to live by it.
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I think you missed the point. According to his model, EPSON does have competitors. They are H-P, Canon, Lexmark, and other printer manufacturers. Nothing is forcing H-P, Canon, Lexmark, and others to follow the same business model. The point is that if ESPON has to open up their ink cartiridge market then they will have to raise prices signficantly on the original printer.
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Re:
What would happen if Sony tried to stop Memorex from making CD's that play on Sony's CD players? People would go nuts.
Or what about my Volkswagon...? Shouldn't I be able to buy gas from Amoco, or Citgo? Because if these printer makers had their way, I'd only be able to buy gas from VW.
I should have the right to buy ink from whomever offers me the best price/value. If that's from Epson, fine. If it's from someone else, that should be fine too.
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EXACTLY. If such a thing were possible, then the particular business plan that they are currently embracing wouldn't work. They'd change.
On the other hand, Epson (and the other printer manufacturers) are saying that they don't want to change, and fuck you if you don't like it. And they're trying their absolute hardest to make sure the law supports them.
We're not demanding that Epson give us cheap printers, so that we can go out and buy cheap cartridges from someone else. We're saying that we like cheap ink, and if Epson doesn't like it, suck it up and charge more for printers. Until they do, we benefit on both sides. ^_^
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Happy Epson'er
Bought an Epson Action Laser 1500 back in 1993. Shortly after getting it, I tried to print and got an awful smell. Turns out my toddler had inserted a 5.25 inch floppy disk in the paper slot, and the printer fed it through until it got to the hot part, and the diskette melted.
I disassembled as much as I could, I pried, I clawed, I whined, and I was sure the printer was garbage.
New cartridges cost me about $200, but last for 1,500 to 2,000 pages, and I've been a happy camper for about thirteen years. It still works great!
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You can buy them for $ 90.00 (Canadian) and Lexmark sells the cartridges for about $ 55.00 each (again Canadian).
Oh, and I never buy extended warranty. :)
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History and technology being what they are, printers will clearly eventually be disposable commodities, they'll probably even include a fixed supply of paper as part of the package.
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No printer manufacturer should be able to make me buy their ink. They made a business decision to sell their printers at cost or below cost. And they figure to recoup that from ink sales. Fine. But don't try to stop others from offering a competing product just because it interferes with their business plan.
Again, just presenting the counter-argument here --- Why not? It's an assertion without support other than "I want my cake (cheap printers) and to eat it too (cheap ink)" that doesn't hold up.
If they can't lock you into the business model then they will no longer sell the printers below cost. Under your theory you should be able to switch cell phone service providers the day after Cingular gives you a $200 phone for free. Of cousre, what would happen is that Cingular just wouldn't give out free phones anymore.
It's not a question of "interfering with" the business model -- it's a question of the existance of a model (cheap hardware, expensive disposables) at all.
Like somebody else said, should Gillette razors have to accept Schick blades? The result is that the price of the razor would go up just as much as the price of blades came down.
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Re:
No, you're missing the point. Yes, Epson has the right to set the business model however they want. And, yes, Epson would probably raise prices on their printers if they couldn't do this business models, but that still doesn't give them the right to block out others from filling the market for parts. They have no legal right to do so.
I understand how the business model works. I'm just saying they should understand that this is one of the risks of such a business model.
So, yes, the answer to your other question is that, if Schick makes blades that fit into Gillette razors, then they need to deal with that. It's called free market competition. What's wrong with it?
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We're arguing on different levels.
The question in the courts right now is whether they have such a legal right or not. It'd be really easy to pass a law giving them the legal right (or taking the legal right away) to force consumers to buy company brand ink.
I'm presenting an argument as to why branded ink could be seen to benefit consumers by looking at the competition at the point of sale of the printer, not the point of sale of ink. "Free market" competition doesn't have to mean absolute freedom -- some business models (eg, being able to get a free phone from Cingular in exchange for a contract) depend on consumers being able to contract into a relationship with a supplier.
Just a thought.
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It's not a question of "a risk of doing business" -- that's punitive. It's a question of "what will the market for printers look like next year?" The legal rights we assign today will shape how printers are sold next year. There is enough competition in the printer market that there is reason to believe that consumers are protected that way -- nobody is making a monopoly profit. After all, if there were a monopoly then printers would be expensive AND ink would be expensive...
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Re:
The situation with Cingular is quite different, because the user is signing a contract. If Epson had a contract that required you to buy Epson ink cartridges (or pay for a service that would regularly deliver ink cartridges) that's one thing. But that's not what's going on.
It's not a question of "a risk of doing business" -- that's punitive. It's a question of "what will the market for printers look like next year?" The legal rights we assign today will shape how printers are sold next year. There is enough competition in the printer market that there is reason to believe that consumers are protected that way -- nobody is making a monopoly profit. After all, if there were a monopoly then printers would be expensive AND ink would be expensive...
Not quite. Part of the problem is that many buyers aren't aware that they're locked into a single seller of ink once they buy the printers. Once they have the printer, it absolutely is a monopoly situation -- and the prices absolutely do reflect that. When the amount of ink to fill a swimming pool is worth about $5 billion, to say there's no monopoly profit is laughable.
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ink is expensive, printers are cheap.
sometimes you can find printers for free (full rebate). just keep getting cheap printers and take the ink. BONUS: it helps screw epson & others over. just an idea.
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Way to treat your loyal customers, Epson.
If someone has a good email address for Epson, please post it. I'd love to share my sentiments with them - and include a link to this thread.
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court case vs. Epson
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My Operating Model...
I used to buy the best printer I could - good color, photo quality, etc.
But I switched my consumer model to what several others here have stated. When a cartridge runs out, I buy a new printer. And for printing photos, nothing is better and more cost effective than walking a block down to the 24 hour Walgreens.
I am happier now with the state of printers and consumables than I was 10 or 15 years ago!
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Buy a cratridge or ink
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Ink is the biggest rip off. adn Epson's next scam
Watch out for Epson, now they put programs in their printers to kill them while they are still good. I blew out my Stylus R300 after 6 months (and a couple hundred superhigh quality 8x10) photographs because the page counter that Epson built in to it indicated that my waste pads were full.
Because I don't use cartridges, I don't have the wasted ink that you get when the heads are primed.
When I took the printer apart, the waste pad was still 95% white. what a ripoff
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Pay per use model
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epson ink business model
I have just come across this discussion.
I am writting a dissertation on The implications of protecting IP whilst intergating it into your Marketing Strategy. Focusing on Epson.
If anyone would like to help by answering a questionnaire and get your opinions heard.
Please email me.. yasonur@gmail.com
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There are other reasons to boycotte Epson
All I can say is what might have been known as a good company in the past now is also getting rid of employees before retirement age now as well, according to old friends still in S. CA.
If ever there was a company to boycott due to labor practices and tremendously overpriced inkjet cartridges, Epson should be at the top of the list!
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