*NEWS*HP:NOT SHY SUING COMPETITION !

[Anonymous]

ink technology rights black and white for H-P
With more than 4,000 patents for printing tools, company isn’t shy about suing competition for potential infringement
CORVALLIS,
Ore. – A team of scientists and a phalanx of lawyers working on behalf
of Hewlett-Packard Co. have one thing on their mind: ink —
specifically, competitors’ ink.H-P’s ink-cartridge business acts as a
powerful annuity for the company. The technology titan, which has a
market share of 50 percent in the United States and more than 4,000
patents on its ink formulations and cartridge design, often sells its
printers at a loss, then essentially locks customers in when they have
to repeatedly come back to buy replacement ink cartridges. In fiscal
2005, H-P made more than 80 percent of its $5.6 billion in operating
profit from ink and toner supplies, according to Sanford C. Bernstein
& Co.To protect this franchise, increasingly under attack from
rivals, H-P could sue any ink makers it suspects are infringing on its
patents. This month, it sued China’s G&G Ninestar Image Co., a
cartridge manufacturer, alleging G&G had violated seven H-P patents
in cartridge design. The complaint also targets four online retailers.
H-P also asked the International Trade Commission to open an
investigation against Ninestar.

A Ninestar spokeswoman said the company had no comment.
This
latest suit follows other actions in the past year. In June, H-P said
retailers Walgreen Co. and OfficeMax Inc. had infringed on H-P ink
patents with ink used at in-store ink-cartridge-refilling stations;
Walgreens and OfficeMax both deny the claims. Last year, H-P similarly
warned the U.S. arm of Cartridge World Inc., a domestic retail
ink-cartridge refiller; Cartridge World says it is working to resolve
the issue.New competitors such as Cartridge World, Caboodle Cartridge
Inc. and Rapid Refill Ink International Corp. refill empty ink
cartridges made by H-P and others and sell them at discounted prices of
as much as 50 percent off a new cartridge in locations such as malls or
urban stores.”A lot of people come into the ink marketplace with some
assumptions that there really isn’t a lot of technology” in ink, says
Tuan Tran, a vice president of marketing in H-P’s printing business.
“We want to remind them that there is a lot of technology that goes
into formulations.”Such a reminder often comes in court, where H-P is
used to defending its patents on various products. In 2003, it launched
a wide effort to protect its intellectual property and profit from its
33,000 patents through technology-licensing deals. Its litigation
strategy has been on the increase under Mark Hurd, H-P’s chief
executive since March 2005, who wants to improve the company’s
profitability. In fiscal 2004, H-P’s patent efforts brought in around
$200 million in cash and product discounts.H-P’s ink studies often
start with teams of people in its worldwide printing group who
routinely collect all the inks they can get on the open market and ship
them to an H-P lab in Corvallis for testing by LeAnn Bell, H-P’s
coordinator of competitive-ink testing, and her team of nine
scientists.In 1998, Bell had just graduated from the University of
Maryland, Baltimore County, with a doctorate in chemistry when she was
recruited by H-P. Having studied mostly substances that cause cancer,
she was surprised that the company wanted her to study something
entirely different: ink.”I never thought about ink,” Bell says. But H-P
had thought about it a lot — and was looking for someone with a
background in chemistry to find a way to analyze inks from competitors
to determine whether H-P patents were being violated.Taking on the
assignment, Bell spent her first years at H-P learning the chemical
components of ink and chemical-testing methods from other chemists. On
average, she and her team test 50 inks in a two- to three-week
period.More often than not, Bell says, she finds suspected
infringements in the inks she tests. But she adds that she isn’t sure
if that is indicative of the market or just of the samples she receives
in the mail.”My job is enforcing our ink patents so that we are all
playing fair,” she says. “It’s the corporate version of CSI.”

[Author]

September 5, 2006 at 11:53 AM