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 user 2007-09-26 at 11:57:00 am Views: 41
  • #18801

    Print War! HP Rips Xerox’ Solid Ink, Xerox Says HP Supplies Wasteful
    normally low-key marketing by printer manufacturers took on a heated
    turn yesterday, as Hewlett-Packard called rival Xerox’ technology
    flawed and inefficient, while Xerox said HP color technology was more
    expensive and wasteful.The sparring between the two giants started
    Monday, when Xerox unveiled new printers and multi-function printers
    that it said made the cost of color printing the same as printing
    black-and-white documents — citing its patented solid-ink technology
    as a differentiator against a comparable printer from Hewlett-Packard.
    Late Monday, a spokeswoman from Hewlett-Packard said the Palo Alto,
    Calif.-based company was working on a response, and HP fired it off at
    about 11 p.m. that night.”There is a huge growth opportunity in the
    color market, so it’s no surprise our competitors are aggressively
    pursuing this space to try to capture market share. Over the years,
    we’ve seen many competitors attempt what Xerox is trying to do — give
    up margins in order to gain market share — but to date no one has been
    successful with this strategy,” HP said in a corporate statement. “It
    is somewhat surprising Xerox would choose to use solid ink technology
    as their play for the color market considering the inherent issues with
    solid ink for general office printing needs, its limited success in the
    market to date, and its environmental challenges,” HP said. It added
    that the Xerox solid ink — which includes black and color ink “sticks”
    instead of more traditional toner cartridges — simply took a lot of
    energy and heat to melt and “as such, the process uses approximately
    triple the power consumption similar products require.”

    HP, the
    printer market share leader, said it considered using its own solid ink
    technology but dropped the idea “long ago” because of the extra energy
    needed to make it work. It also derided the quality of Xerox’ solid
    ink, saying, “the output from solid ink also has quality and durability
    issues ” it can melt in extreme heat and the waxy surface makes it
    harder to write on, highlight, archive and more prone to
    scratches.”After the lengthy and detailed criticism leveled by HP,
    Xerox, Stamford, Conn., responded with its own corporate
    statement.”Xerox has been continually evolving and enhancing solid
    ink,” said Xerox in a statement sent via email. “Today, the solid ink
    sticks not only produce vibrant colors on virtually any media type –
    including recycled paper stock — with no bleeding, they create
    substantially less waste than ever before.”

    Then, in another shot at HP, Xerox said:
    a typical color laser printer generates about 157 pounds of waste
    (packaging and cartridges) after 100,000 prints, the Phaser 8860
    printer, (which has no cartridge) produces only 5 pounds of waste after
    100,000 prints. Many agree that such results outweigh the nominal
    increase in energy that’s required to run the device (12.6 kilowatt
    hours/week, vs. 4.9kilowatt hours/week for the HP 4700),” Xerox
    said.While HP has enjoyed a strong run in the market share leadership
    position, worldwide as well as in the North American solution provider
    channel, Xerox has been making an aggressive play over the past year to
    steal business. Earlier this year, in an initiative led by Xerox
    Chairman and CEO Anne Mulcahy, Xerox began an initiative to boost its
    channel sales through solution providers in the small and mid-sized
    business segment and the company has launched several new color
    printers and MFPs this year. Xerox also is working to boost what it
    calls its PagePack program, in which solution providers can sell solid
    ink and supplies contracts to customersAs part of Monday’s
    announcement, Xerox said that it would price a package of solid ink at
    $216 for a black ink stick and $72 for each of three color sticks — a
    combination that yields 14,000 printed pages.”They are different
    technologies,” said Brian Seelinger of Erie Computer, an Erie,
    Pa.-based solution provider whose company sells both Xerox and HP
    products. “Solid ink technology is relatively decent technology,
    relatively cost-effective. It gives people who have any (environmental)
    slant the warm fuzzies, because of the waste issue.”He added, “We’re
    always going to sell what’s best for the customer, whether it’s Xerox
    solid ink or a laser printer.”

    Xerox aims to challenge HP with new color printers
    YORK – In a move aimed at chipping away at Hewlett-Packard Co’s
    dominance, Xerox Corp  on Monday launched a system promising to slash
    the cost of color printing for high-volume users willing to pay more
    initially for machinesXerox introduced five printers, including the
    Phaser 8860 which features new solid-ink technology, saying the system
    puts the cost of color pages on par with that of black-and-whiteSolid
    ink uses wax ink sticks rather than the cartridges of powdered toner
    found in laser printers. The process works like that of a high-end
    offset press to create richer colors, the company says, and has
    significantly fewer disposable parts, which leads to lower maintenance
    costs.”If you compare HP color toner to what our inks will be, we will
    be one-fifth the price. We think it’s going to help us grow our market
    share and attract a lot of customers who maybe don’t consider Xerox
    today,” said Jim Rise, a Xerox vice president.

    Experts say color
    documents are seen as more effective in communications, but the cost of
    buying new color printers, supplies and service contracts has been a
    barrier to adoption.Xerox says the printers cut the cost of printing a
    color page to about 5 cents a page, a fraction of rival systems, which
    analysts peg at between 8 cents and 13 cents a page.Yet to stay
    profitable, the Xerox printers are priced higher. The strategy is
    similar to Eastman Kodak Co’s (EK.N: Quote, Profile, Research) consumer
    inkjet printers unveiled this year. Both represent a shift from the
    so-called razor/razor blade model — selling hardware at little or no
    profit to encourage sales of more profitable replacement ink and
    toner.At $2,500 to $4,000, the Phaser 8860 is roughly $1,000 more than
    other Xerox products with similar functions, said analyst Angela Boyd
    of research firm IDC. That may lead some potential buyers to think
    twice.”It’s targeted at the person who has made up their mind they want
    color. It’s not for the person who is happy with their black-and-white
    laser machine,” she says. “Eighty percent of the world is still buying
    black-and-white laser machines.”

    said its new solid-ink system, five years in the making, uses
    long-lasting crayon-like ink sticks. By increasing the total number of
    color pages the ink sticks produce, Xerox says it has reduced the price
    of color printing.Printer makers for years have been promoting the move
    to color printers, mostly by cutting prices. That has prompted printer
    makers to battle on the idea of lower cost-per-page, which would most
    benefit high-volume users.Xerox’s new systems are aimed at customers
    that print 2,000 to 10,000 pages a month, such as real estate offices
    or departments inside big corporations. They come at a time when
    investors are looking for a spark from Xerox, whose stock closed on
    Friday on the New York Stock Exchange at $17.02, one penny better than
    its closing level on December 31, 2004.Experts credit the company with
    impressive additions to its office line, solid profitability and
    improved market share. But analysts have been disappointed by tepid
    sales gains — Xerox’s revenue ended 2006 at $15.9 billion, up only
    about 3 percent from 2003. Analysts, on average, expect a 7 percent
    rise in 2007 annual revenue from 2006, according to Reuters
    Estimates.The new system will not shift the balance of power, IDC’s
    Boyd says. HP  dominates the global office laser printer market with a
    40 percent share, with Xerox at 10 percent, and Japan’s Canon Inc  at
    about 7 percent, she says.”It puts Xerox in a good competitive
    situation among all the others chasing that juggernaut (HP),” she says.
    I don’t think this is going to change things dramatically for Xerox.
    Xerox has been able to remain in the top tier of vendors and it will
    help them sustain behind HP.”

    Xerox Ready To Rumble With HP In Color Printer Market
    Monday continued its aggressive pace of new product rollouts this year,
    as it seeks to put color document production on a pricing par with

    The Stamford, Conn.-based company
    unveiled a new lineup of Phaser and WorkCentre products, saying it was
    rolling out a “color-for-the-price of black and white” strategy that
    leverages its solid ink technology.Xerox said it would ship the Phaser
    8860 color printer and Phaser 8860 multi-function printer priced at
    $2,499 and $3,999, respectively. The company said the products and the
    solid ink supplies would make it compare favorably on a total cost of
    ownership and cost of output basis with HP’s color Laserjet 4700dn
    printer. The Phaser 8860 ships now, the MFP version ships in November,
    Xerox said.”If you’ve accepted color, and you want to print the same
    thing that’s on your screen, we’re allowing you to do that now and this
    should be your default printer,” said David Bates, director of product
    marketing for Xerox’ office group. “You no longer have to make a
    decision between monochrome and color.”We’ve got a strong lineup, that
    lines up with the competition very well,” Bates said.

    explaining how it is bringing color printing into the same price
    ballpark and black and white, Xerox said that the cost of printing with
    black ink in its solid ink systems, on a yield of 14,000 pages, is $215
    while each color stick in the Xerox solid ink lineup, which also yields
    14,000 pages, is priced at $72. They compared that with the Laserjet
    4700dn, which it said runs $178.99 for a back toner cartridge that
    covers 11,000 pages, and $253.99 for each color toner cartridge that
    runs 10,000 pages. The net result, Xerox claims, is that color printing
    on its systems is on par with the cost for black-and-white, and
    competitive with HP.Rivals including Lexmark announced a similar
    initiative about two years ago, though the Lexington, Kentucky-based
    printer maker has suffered a number of setbacks in its business overall
    since then. Hewlett-Packard has continued to dominate the printer
    market, after announcing its own scalable print technology also about
    two years ago. However, Xerox executives from Chairman and CEO Anne
    Mulcahy on down have been vocal this year about their technology edge
    with solid ink and how it compares against traditional ink and toner
    manufactured by rivals. And the company is also in the midst of
    developing a deeper business in the North American solution provider
    channel with added support and incentives for VARs.Xerox also announced
    new entry-level color WorkCentre workgroup printers, the WorkCentre
    7232 and WorkCentre 7242, aimed at small and mid-sized businesses and
    integrated with Xerox’ Extensible Interface Platform (EIP) which
    supports custom applications. Xerox says the 7200 line is aimed at the
    “color-cautious” segment of the market — businesses that use color
    occasionally but focus primarily on black and white documents. The
    WorkCentre 7232, street-priced at $5,299, is available in January and
    the WorkCentre 7242, street-priced at $6299, is available in November,
    Xerox said.