OEM’S RIP-OFF CONSUMERS $6B ANNUALLY

[Anonymous]

Overpriced Printer Ink Costs Consumers $6 Billion Annually
Recent
Study Finds Consumers Have No Effective Basis for Comparison when
Purchasing Inkjet Printer Ink; Leads to Unnecessarily High Spending on
Ink
WASHINGTON,
Nov. 07 — The American Consumer Institute(ACI) urges consumers this
holiday season to do their research before purchasing a home printer —
or getting one for free with a computer purchase. A new white paper
entitled “Inkjet Prices, Printing Costs and Consumer Welfare,” exposes
pricing strategies within the inkjet industry that leave consumers at a
major disadvantage and ultimately cost them an estimated $6 billion a
year, collectively.     The study finds that inkjet printers are
routinely under-priced to entice consumers to purchase the product.
Once purchased, consumers are trapped into spending hundreds of extra
dollars to operate the printers due to the high price of printer ink.
This business model reflects the well known “razor/razor blade model”
wherein durable assets (printers) are sold below cost and “consumables”
(ink) are marked up substantially. In fact, ink is currently priced
higher per milliliter than the world’s finest champagne, gasoline and
most luxury fragrances.”Value shoppers” are seriously handicapped and
mislead at the point of sale by the lack of information about printing
costs. They pay for cartridges without knowing how much ink is in them
or how many pages one will print. Consumers shop blindly due to a lack
of standardized printer ink unit pricing (such as cents-per-page
printed). It is not enough to look at printer cartridges’ prices
either, since the lowest priced cartridges often have the highest
cost-of-ink per page. “When purchasing an inkjet printer, consumers
should consider the full cost of printing, the cost of the ink used to
print as well as the cost of the printer itself,” explains Dr. Larry F.
Darby, coauthor of the report. “Free or low-cost printers are ‘fools
gold’ when they lock consumers into using high cost ink for the life of
the printer. Consumers are comparing apples and oranges as they shop
for printers. It’s very confusing.”Consumers would be well served by
adoption of a form of truth-in-labeling to allow them to compare each
printer’s cost-of-ink per printed page. The paper concludes that
competition in the inkjet printer and ink sectors would be much more
intense if consumers were made aware of  the cost implications of their
printer choices. Better information means lower costs for consumers.

The
study estimates that consumers would reap a sizable gain, estimated to
be conservatively $6 billion per year once information-driven
competition in the inkjet industry is fully realized in the
marketplace. The study was conducted by TeleNomic Research with an
unrestricted grant from Kodak. The American Consumer Institute received
no funding for this study’s release. A synopsis of the findings,
consumer tips to save on printer costs and a copy of the full study are
available at available at http://www.aci-citizenresearch.org.

[Author]

November 21, 2007 at 1:59 PM