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 user 2003-12-02 at 9:35:00 am Views: 123
  • #8052

    IBM Brands HP’s Recycled Cartridges

    International Business Machines has quietly begun putting its brand name on recycled, remanufactured cartridges for Hewlett-Packard laser Printers in a move to undercut the prices of one of H-P’s most profitable products.

    Small manufacturers have recycled HP (nyse: HPQnews - people ) cartridges for years, but customers have asked IBM (nyse: IBMnews - people ) to attach its brand to the cartridges as a stamp of reliability, said IBM printing executive Michele Morris.

    IBM also makes its own printers with their own corresponding cartridges, but HP printers dominate the market.

    “We’re just taking the opportunity to help our customers lower costs,” Ms. Morris said.

    IBM has not decided to put its brand name on recycled cartridges that work with printers made by other manufacturers, such as Lexmark International (nyse: LXKnews - people ), she said.

    HP isn’t worried about IBM’s move, said Boris Elisman, a vice president in HP’s supplies business.

    “It would be different if IBM was doing something novel here or working with new stuff, but IBM is basically re-batching the same remanufacturers that have been competing against us for years,” he said.

    “As far as the value proposition and the quality of the cartridges, we don’t expect anything new.”

    IBM’s recycled cartridges offer a significant discount from HP’s cartridges.

    This week, for instance, IBM was selling recycled cartridges for 5L and 6L series HP LaserJets through its Web site for $43, compared to $59 for a new cartridge on HP’s Web site