Kodak plans to sell inkjet printers with cheaper ink

http://www.USATODAY.com - Tue Feb 6, 10:01 AM ET

Struggling photo giant Eastman Kodak is launching a new line of inkjet printers aimed at luring digital shutterbugs back to Kodak paper. The pitch: cheap ink.

Kodak's ink will sell for about $25 when the printers hit stores in March. That's far less than the $60 to $80 it typically costs for replacement ink for photo printers.

"Consumers aren't printing as much as they could, because home printing is so expensive, and the quality isn't as good as the lab," says Kodak marketing director Bob Ohlweiler. "We have the technology to solve these issues."
For years, companies such as Hewlett-Packard, Epson, Canon and Lexmark have sold inexpensive consumer-grade inkjet printers - many are about $100 or so - and made up the difference in ink sales.
Manufacturers can make as much as 75% profit on the sale of ink cartridges, says Jim Forrest, an analyst at Lyra Research. Printer ink is a $32 billion market worldwide, he says.
Inkjet manufacturers have never lowered their prices or engaged in a price war, Forrest says. But that could happen if Kodak's printers take off.
Ohlweiler says Kodak will profit handily on its ink sales, even if the margins are lower than competitors'. He says Kodak will include more ink in its cartridges than competitors do.
About 56% of digital-camera owners print images on home printers, according to research firm IDC.
Kodak's first two printers initially will be sold exclusively at Best Buy and Kodak.com, for $149 to $199. Kodak currently has a line of printer docks, but they don't print documents and work only with Kodak cameras.
IDC analyst Chris Chute says Kodak has a "decent chance" of making a dent in the printing market. "They have proven with digital cameras that they can effectively market their products."
A successful printing business won't make up for lost film sales, but by putting Kodak into a market it wasn't in, "It moves them forward," he says.
Epson Vice President Keith Kratzberg isn't worried. "Selling lower-priced ink doesn't sound like much to go on," he says. "Kodak will have to exceed our level of quality, which won't be easy."

full article: http://www.usatoday.com/tech/products/2007-02-06-kodak-printer_x.htm


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