Generic cartridges leave mark on Lexmark
profitsApril , 2005,
US printer manufacturer Lexmark said on Tuesday that
third-party printer cartridges are impacting its sales figures.
Customers are increasingly buying lower-priced ‘generic’ ink
cartridges, which has reduced Lexmark’s profits and revenue growth, according to
the Financial Times. Lexmark reported a first-quarter operating profit of
$161.7m (£84.94m) from revenues of $1.358 billion. This represents a
first-quarter revenue increase of eight percent from 2004 to 2005, compared with
an increase of 13 percent from 2003 to 2004.
The issue of third-party vendors selling printer cartridges
is one that affects all printer manufacturers. Last month, printer manufacturer
HP sued two companies that sell refilled ink cartridges.
It alleged that one of the companies, InkCycle, violated
three HP patents with its ink. It accused the other company, RhinoTek, of false
advertising by using packaging that indicated did not indicate that its refilled
HP printer cartridges were recycled.
Last year Lexmark lost a legal battle over cartridge
refills. The company alleged in 2003 that Static Control Components had violated
the Digital Millennium Copyright Act (DMCA) by selling its Smartek chips to
companies that refill toner cartridges and undercut Lexmark’s prices. But, in
October 2004, a US federal court ruled that Static Control can continue selling
the chip, as the DMCA allows exemptions for the purpose of
interoperability.