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AnonymousInactivePrint War! HP Rips Xerox’ Solid Ink, Xerox Says HP Supplies Wasteful
The
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:
“While
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
NEW
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.”INVESTORS LOOKING FOR A SPARK
Xerox
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
Xerox
Monday continued its aggressive pace of new product rollouts this year,
as it seeks to put color document production on a pricing par with
black-and-white.
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.In
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. -
AuthorSeptember 26, 2007 at 11:57 AM
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