THRU 3Q. OF 2009 KODAK SHIPS 800,000 PRINTERS (live video)

[Anonymous]

http://www.usatoday.com/tech/news/2009-11-30-printers30_ST_N.htm
THRU 3Q. OF 2009 KODAK SHIPS 800,000
PRINTERS
Kodak printer ads
remind consumers of lower ink costs
click
on this link below to see live video
http://www.usatoday.com/tech/news/2009-11-30-printers30_ST_N.htm
Photo giant Kodak burst onto the home printing scene in 2007
vowing to shake up the industry by selling ink at half the price of its
competitors.But while the company has succeeded in doubling its tiny
market share year to year – to 2% in 2009 – industry heavyweights
Hewlett-Packard, Epson and Canon have yet to respond with major ink
price cuts, nor are they expected to, says Andy Lippman, a senior
analyst at Lyra Research.”It’s a testament to the business model,” he
says. “You sell the printer at a loss and make it up on ink sales. If HP
was to match Kodak’s pricing, it would be monumental, and you’d see an
immediate impact on its profit margins.”The recession has taken its toll
on sales of ink-jet printers, which are down 12% this year, Lippman
says, but ink sales have fallen only 6%.”Consumers say they care about
the high cost of ink, but when they go to the store to buy a new
printer, they shop for price,” Lippman adds. “They’ve heard the
messaging from Kodak, but it hasn’t resonated.”

Kodak, which
launched its printer line with an aggressive series of infomercials on
pricing, is pushing back with an even feistier $30 million “Print and
Prosper” TV and webcampaign.Its website, for instance, tells consumers
they would have saved $110 in printing costs had they switched to Kodak.
It also offers a price chart that promises to tell how much folks
overspent with their various printer models from Epson, HP, Canon,
Lexmark and Brother.The calculations are based on a basic formula, of,
for instance, eight black-and-white documents, six color documents and a
4-by-6 photo printed in a specific time period. Kodak generally charges
more than competitors do for printers.

No. 1 HP says the
ink-savings claims are misleading. “Their savings are probably at best
at about $1 per month,” says Andy Binder, HP’s director of market
development.Still, on an average HP color printer, Binder says that it
costs about $75 to restock the six color inks and one black ink. Kodak’s
inks are $9.99 for a black cartridge and $14.99 for color.Kodak says it
bases its findings on an average of 1,500 printed pages per year for
the average consumer. Binder says that’s way too high and that most
folks print 750 pages.

He adds that HP makes printers
specifically for price-sensitive people who print a lot of
black-and-white documents, which use less ink.Cheryl Pohlman, a Kodak
marketing director, says the “Print and Prosper” marketing campaign has
helped the company sell twice as many printers this year as last
year.”There’s a frustration level when consumers go to the store and
have to spend $75 on ink, especially in these economic times,” she says.

Kodak
shipped about 800,000 printers in the first three quarters of 2009 – up
from 400,000 at the same time last year, IDC analyst Ron Glaz
says.However, that’s not enough to pull it out of last place in market
share, Glaz says.Industry leader HP shipped 18.4 million printers, down
from 21.7 million in 2008. It’s current market share is 47%, down from
51% in 2008, IDC says.”People just don’t see the need to print as much
as they used to, which is what’s causing the decline,” Glaz says. “A lot
of homework is sent electronically now. They’re sending photos to
Facebook instead of printing them. In this era of the smartphone, when
we’re online all the time, do we really need to print everything we
see?”When Kodak launched its printer line, it told analysts it would
achieve $1 billion in sales by the end of 2010.

Recession has
an impact
Lippman says that’s not going to happen, estimating
Kodak’s sales to date at about $350 million.”They were a bit too
optimistic about consumers and their understanding of print costs,” he
says. “Plus, they couldn’t have foreseen the recession.”Consumers have
been holding off their purchases of new printers, waiting for current
printers to break or jam before buying, he adds.A visit to the store,
however, would find some innovations to current printers, including some
new models with Wi-Fi capability for wireless printing.One thing hasn’t
changed, however: An ink refresh will still set you back almost as much
as a new printer, unless you call on Kodak.ink-jet printer sales are
down 12% this year.

[Author]

December 7, 2009 at 10:19 AM