Can Kodak break the ink cartel?

Ever since Kodak announced on February 6th its entrance into the
consumer photo inkjet arena, market analysts have been debating if
Kodak can compete in this already mature market, especially against
the printer giant Hewlett-Packard.

With its very profitable film sales market rapidly dwindling, Kodak
quickly needs another cash cow. Kodak's CEO, Antonio Perez, came to
Kodak three and a half years ago from HP's very profitable inkjet-
printer business, with a plan to revitalize the company through a
dramatic change in the consumer inkjet industry. Perez's plan was to
produce an inkjet printer and ink as good or better than the
competition, but to attack the thing that has aggravated consumers the
most-the high cost of inks.

Ink manufacturer profits often reaching over 75%, tempting companies
to sell their printers at or below cost, just to get the ink cartridge
sales (the old razor and razor blade principle). Kodak's plan is to
sell ink cartridges at prices that are one-half of their competition,
and still be highly profitable because consumers will be induced to
print more photos at the cheaper prices, and then buy more of their
ink. See related story:
http://www.InkjetNEWSandTIPS.com/news/2007-02-09.html

High-ranking executives from both HP and Epson have scoffed at Kodak's
plans to compete in their markets. Market analysts predict that it
will be difficult for Kodak to get shelf space at many of the big-box
stores because HP offers so many incentives to dealers to keep their
products in front of buyers, and exclude competitors. With so much on
the line, industry experts expect HP to pull out all the stops.

After reading Business Week's six page article ("Kodak's Moment of
Truth") in their February 19th issue, I believe Kodak and Perez's team
can pull this off. Analysts who have seen Kodak's printers have come
away impressed. Although this is a roll of the dice on a risky new
strategy to reinvent the inkjet printer, all the right pieces are in
place.

Susan Tousi, Kodak's head of R&D (and affectionately dubbed by her
colleagues as the "Queen of Geeks") kept sending the engineering staff
back to the drawing board to get it right, after having been told by
Perez, "We have only one chance to do this right. If our first
introduction fails, we fail."

Unlike HP, Kodak's EasyShare printers follow Epson and Canon's
philosophy of placing the print heads in the printer and not on the
ink cartridges. This allows the manufacturer to producer much cheaper
inkjet cartridges, because their main purpose is just to act as a
reservoir to hold ink. To really cut costs, Kodak could have gone with
the cheaper and less problematic dye ink technology. But dye inks fade
fast, often in less than 15 years, and dye made prints are very
susceptible to smudging and water damage. Kodak's R&D team spent
almost three years developing a new pigment ink technology that
produces water-resistant and fade-resistant prints that will last 100
years or more.

Kodak's inkjet printers have 3,840 nozzles that fire at a rate of
24,000 drops per second. The pigment inks dry in just 15 milliseconds
on Kodak's microporous papers, and the printers can produce a 4x6
print in 28 seconds.

The Kodak EasyShare All-in-One printers (starting at $149.99) are
focused on the consumer market, with black ink replacement cartridges
costing $9.99 and color $14.99 (all 5 colors). If consumers buy
Kodak's economical Photo Value Pack, which combines paper and ink, the
cost per print is about 10 cents, vs. 24 cents for HP's comparable
package and 29 cents for Epson's.

To kick-start distribution, Kodak has made a deal with Best Buy Co, to
be the exclusive retailer of these products for the first three
months, beginning in March, when the printers are introduced.

Royce Bair
Tips, news, reviews and resources...
http://www.InkjetNEWSandTIPS.com/

wrote:
Ever since Kodak announced on February 6th its entrance into the
consumer photo inkjet arena, market analysts have been debating if
Kodak can compete in this already mature market, especially against
the printer giant Hewlett-Packard.

With its very profitable film sales market rapidly dwindling, Kodak
quickly needs another cash cow. Kodak's CEO, Antonio Perez, came to
Kodak three and a half years ago from HP's very profitable inkjet-
printer business, with a plan to revitalize the company through a
dramatic change in the consumer inkjet industry. Perez's plan was to
produce an inkjet printer and ink as good or better than the
competition, but to attack the thing that has aggravated consumers the
most-the high cost of inks.

Ink manufacturer profits often reaching over 75%, tempting companies
to sell their printers at or below cost,

That is not totally true. Sure for the entry level printers like the
IP4300 and the R3xx and HP entry like that but it does not hold true for
the wide format printers like the Canon Pro 9000 and the Epson R1800 etc.

With those you have a relatively high printer costs and the same high
ink costs. I know that there is not the volume on those printers so it
would be nice to see quality OEM ink costs go down across the entire
industry.
just to get the ink cartridge
sales (the old razor and razor blade principle). Kodak's plan is to
sell ink cartridges at prices that are one-half of their competition,
and still be highly profitable because consumers will be induced to
print more photos at the cheaper prices, and then buy more of their
ink. See related story:
http://www.InkjetNEWSandTIPS.com/news/2007-02-09.html

High-ranking executives from both HP and Epson have scoffed at Kodak's
plans to compete in their markets.

Where can we read about this scoffing?
Market analysts predict that it
will be difficult for Kodak to get shelf space at many of the big-box
stores because HP offers so many incentives to dealers to keep their
products in front of buyers, and exclude competitors. With so much on
the line, industry experts expect HP to pull out all the stops.

After reading Business Week's six page article ("Kodak's Moment of
Truth") in their February 19th issue, I believe Kodak and Perez's team
can pull this off. Analysts who have seen Kodak's printers have come
away impressed. Although this is a roll of the dice on a risky new
strategy to reinvent the inkjet printer, all the right pieces are in
place.

Susan Tousi, Kodak's head of R&D (and affectionately dubbed by her
colleagues as the "Queen of Geeks") kept sending the engineering staff
back to the drawing board to get it right, after having been told by
Perez, "We have only one chance to do this right. If our first
introduction fails, we fail."

Unlike HP, Kodak's EasyShare printers follow Epson and Canon's
philosophy of placing the print heads in the printer and not on the
ink cartridges. This allows the manufacturer to producer much cheaper
inkjet cartridges, because their main purpose is just to act as a
reservoir to hold ink. To really cut costs, Kodak could have gone with
the cheaper and less problematic dye ink technology. But dye inks fade
fast,

That is not true. The Canon ink on my IP4000 has not fading in over two
years with prints just lying on a desk. The newer dye ink is even
better and the results have more impact and a better color gamut than
pigment inks. It is true, however, that the pigment inks will last
longer (especially on artistic papers) than the dye counterparts under
the same circumstances.
often in less than 15 years, and dye made prints are very
susceptible to smudging and water damage. Kodak's R&D team spent
almost three years developing a new pigment ink technology that
produces water-resistant and fade-resistant prints that will last 100
years or more.


Now tell me a relabeler is going to spend 3 years to develop an ink.
Kodak's inkjet printers have 3,840 nozzles that fire at a rate of
24,000 drops per second. The pigment inks dry in just 15 milliseconds
on Kodak's microporous papers,

And what about other microporous paper?
and the printers can produce a 4x6
print in 28 seconds.

The Kodak EasyShare All-in-One printers (starting at $149.99) are
focused on the consumer market, with black ink replacement cartridges
costing $9.99 and color $14.99 (all 5 colors). If consumers buy
Kodak's economical Photo Value Pack, which combines paper and ink, the
cost per print is about 10 cents, vs. 24 cents for HP's comparable
package and 29 cents for Epson's.

To kick-start distribution, Kodak has made a deal with Best Buy Co, to
be the exclusive retailer of these products for the first three
months, beginning in March, when the printers are introduced.

Royce Bair
Tips, news, reviews and resources...
http://www.InkjetNEWSandTIPS.com/

measekite wrote:
That is not totally true. Sure for the entry level printers like the
IP4300 and the R3xx and HP entry like that but it does not hold true for
the wide format printers like the Canon Pro 9000 and the Epson R1800 etc.

With those you have a relatively high printer costs and the same high
ink costs. I know that there is not the volume on those printers so it
would be nice to see quality OEM ink costs go down across the entire
industry.

I too have several "pro" printers (i.e. Epson R2400, Epson Pro 4800)
that have high printer costs --but we're talking about the "consumer"
market. There are only 150,000 professional photographers in the USA,
but millions of consumers that want to print their photos cheaply.

Where can we read about this scoffing?

USA Today had an article after the Feb 6 Kodak announcement that said:
"Epson's Vice-President Keith Kratzberg isn't worried. 'Selling lower-
priced ink doesn't sound like much to go on,' he says. 'Kodak will
have to exceed our level of quality, which won't be easy.' The
Business Week article had several cutting remarks by the HP execs.


That is not true [about dye ink fading quickly].
The Canon ink on my IP4000 has not fading in over two
years with prints just lying on a desk. The newer dye ink is even
better and the results have more impact and a better color gamut than
pigment inks. It is true, however, that the pigment inks will last
longer (especially on artistic papers) than the dye counterparts under
the same circumstances.

I admit that Canon is an exception, but generally, most dye inks fade
quite quickly. I was an early pioneer in helping to bring some of the
more robust dye inks into the market in the late 1990's and early
2000's, i.e. Lysonic and Fotonic. Rumor has it that Canon negotiated
with Lyson to use the Fotonic ink formulation in their printers.

It has been proven that some of the newer pigment ink formulation
actually have as wide of a color gamut as dye inks. What most pigment
inks lack is the little extra D-Max that dye inks inheritanly have
because pigment inks lie more on the surface of the print and reflect
more light. Despite this, the better pigment inks already produce a
higher D-Max and wider color gamut that most photo wet lab prints
(we're spoiled).

Now tell me a relabeler is going to spend 3 years to develop an ink.

That's the clincher. At Kodak's prices it is going to make it
virtually unprofitable for the relabelers and compatibles to produce
knock-off inks.

And what about other microporous paper?

I don't think Kodak's microporous paper is going to be much different
than some of the good "premium" microporous papers out there already,
but it will often come as a package deal with the inks. If the soccer
mom gets terrific looking prints at a great price, she's not going
look any further for competitive products.

Royce Bair
Tips, news, reviews and resources...
http://www.InkjetNEWSandTIPS.com/

wrote:
measekite wrote:

That is not totally true. Sure for the entry level printers like the
IP4300 and the R3xx and HP entry like that but it does not hold true for
the wide format printers like the Canon Pro 9000 and the Epson R1800 etc.

With those you have a relatively high printer costs and the same high
ink costs. I know that there is not the volume on those printers so it
would be nice to see quality OEM ink costs go down across the entire
industry.


I too have several "pro" printers (i.e. Epson R2400, Epson Pro 4800)
that have high printer costs --but we're talking about the "consumer"
market. There are only 150,000 professional photographers in the USA,
but millions of consumers that want to print their photos cheaply.


Where can we read about this scoffing?


USA Today had an article after the Feb 6 Kodak announcement that said:
"Epson's Vice-President Keith Kratzberg isn't worried. 'Selling lower-
priced ink doesn't sound like much to go on,' he says. 'Kodak will
have to exceed our level of quality, which won't be easy.' The
Business Week article had several cutting remarks by the HP execs.



That is not true [about dye ink fading quickly].
The Canon ink on my IP4000 has not fading in over two
years with prints just lying on a desk. The newer dye ink is even
better and the results have more impact and a better color gamut than
pigment inks. It is true, however, that the pigment inks will last
longer (especially on artistic papers) than the dye counterparts under
the same circumstances.


I admit that Canon is an exception, but generally, most dye inks fade
quite quickly. I was an early pioneer in helping to bring some of the
more robust dye inks into the market in the late 1990's and early
2000's, i.e. Lysonic and Fotonic. Rumor has it that Canon negotiated
with Lyson to use the Fotonic ink formulation in their printers.

It has been proven that some of the newer pigment ink formulation
actually have as wide of a color gamut as dye inks. What most pigment
inks lack is the little extra D-Max that dye inks inheritanly have
because pigment inks lie more on the surface of the print and reflect
more light. Despite this, the better pigment inks already produce a
higher D-Max and wider color gamut that most photo wet lab prints
(we're spoiled).


Now tell me a relabeler is going to spend 3 years to develop an ink.


That's the clincher. At Kodak's prices it is going to make it
virtually unprofitable for the relabelers and compatibles to produce
knock-off inks.


I think that is terrific. I wish Canon, Epson, and HP would also drop
their prices for ink in half (and maybe raise the printer price some)
and drive the relabelers out of the business. Then we will have some
consistency and professional labeling.

And what about other microporous paper?


I don't think Kodak's microporous paper is going to be much different
than some of the good "premium" microporous papers out there already,
but it will often come as a package deal with the inks. If the soccer
mom gets terrific looking prints at a great price, she's not going
look any further for competitive products.


If this Kodak printer is any good then I hope they make a dual paper
feed wide format printer as well.
Royce Bair
Tips, news, reviews and resources...
http://www.InkjetNEWSandTIPS.com/

On Feb 14, 3:06 pm, measekite wrote:
wrote:
measekite wrote:

That is not totally true. Sure for the entry level printers like the
IP4300 and the R3xx and HP entry like that but it does not hold true for
the wide format printers like the Canon Pro 9000 and the Epson R1800 etc.

With those you have a relatively high printer costs and the same high
inkcosts. I know that there is not the volume on those printers so it
would be nice to see quality OEMinkcosts go down across the entire
industry.

I too have several "pro" printers (i.e. Epson R2400, Epson Pro 4800)
that have high printer costs --but we're talking about the "consumer"
market. There are only 150,000 professional photographers in the USA,
but millions of consumers that want to print their photos cheaply.

Where can we read about this scoffing?

USA Today had an article after the Feb 6 Kodak announcement that said:
"Epson's Vice-President Keith Kratzberg isn't worried. 'Selling lower-
pricedinkdoesn't sound like much to go on,' he says. 'Kodak will
have to exceed our level of quality, which won't be easy.' The
Business Week article had several cutting remarks by the HP execs.

That is not true [about dyeinkfading quickly].
The Canoninkon my IP4000 has not fading in over two
years with prints just lying on a desk. The newer dyeinkis even
better and the results have more impact and a better color gamut than
pigment inks. It is true, however, that the pigment inks will last
longer (especially on artistic papers) than the dye counterparts under
the same circumstances.

I admit that Canon is an exception, but generally, most dye inks fade
quite quickly. I was an early pioneer in helping to bring some of the
more robust dye inks into the market in the late 1990's and early
2000's, i.e. Lysonic and Fotonic. Rumor has it that Canon negotiated
with Lyson to use the Fotonicinkformulation in their printers.

It has been proven that some of the newer pigmentinkformulation
actually have as wide of a color gamut as dye inks. What most pigment
inks lack is the little extra D-Max that dye inks inheritanly have
because pigment inks lie more on the surface of the print and reflect
more light. Despite this, the better pigment inks already produce a
higher D-Max and wider color gamut that most photo wet lab prints
(we're spoiled).

Now tell me a relabeler is going to spend 3 years to develop anink.

That's the clincher. At Kodak's prices it is going to make it
virtually unprofitable for the relabelers and compatibles to produce
knock-off inks.

I think that is terrific. I wish Canon, Epson, and HP would also drop
their prices forinkin half (and maybe raise the printer price some)
and drive the relabelers out of the business. Then we will have some
consistency and professional labeling.



And what about other microporous paper?

I don't think Kodak's microporous paper is going to be much different
than some of the good "premium" microporous papers out there already,
but it will often come as a package deal with the inks. If the soccer
mom gets terrific looking prints at a great price, she's not going
look any further for competitive products.

If this Kodak printer is any good then I hope they make a dual paper
feed wide format printer as well.

Royce Bair
Tips, news, reviews and resources...
http://www.InkjetNEWSandTIPS.com/

Check out http://www.inkisit.com

On Mar 15, 3:12 am, "inkisit.com" wrote:
On Feb 14, 3:06 pm, measekite wrote:



wrote:
measekite wrote:

That is not totally true. Sure for the entry level printers like the
IP4300 and the R3xx and HP entry like that but it does not hold true for
the wide format printers like the Canon Pro 9000 and the Epson R1800 etc.

With those you have a relatively high printer costs and the same high
inkcosts. I know that there is not the volume on those printers so it
would be nice to see quality OEMinkcosts go down across the entire
industry.

I too have several "pro" printers (i.e. Epson R2400, Epson Pro 4800)
that have high printer costs --but we're talking about the "consumer"
market. There are only 150,000 professional photographers in the USA,
but millions of consumers that want to print their photos cheaply.

Where can we read about this scoffing?

USA Today had an article after the Feb 6 Kodak announcement that said:
"Epson's Vice-President Keith Kratzberg isn't worried. 'Selling lower-
pricedinkdoesn't sound like much to go on,' he says. 'Kodak will
have to exceed our level of quality, which won't be easy.' The
Business Week article had several cutting remarks by the HP execs.

That is not true [about dyeinkfading quickly].
The Canoninkon my IP4000 has not fading in over two
years with prints just lying on a desk. The newer dyeinkis even
better and the results have more impact and a better color gamut than
pigment inks. It is true, however, that the pigment inks will last
longer (especially on artistic papers) than the dye counterparts under
the same circumstances.

I admit that Canon is an exception, but generally, most dye inks fade
quite quickly. I was an early pioneer in helping to bring some of the
more robust dye inks into the market in the late 1990's and early
2000's, i.e. Lysonic and Fotonic. Rumor has it that Canon negotiated
with Lyson to use the Fotonicinkformulation in their printers.

It has been proven that some of the newer pigmentinkformulation
actually have as wide of a color gamut as dye inks. What most pigment
inks lack is the little extra D-Max that dye inks inheritanly have
because pigment inks lie more on the surface of the print and reflect
more light. Despite this, the better pigment inks already produce a
higher D-Max and wider color gamut that most photo wet lab prints
(we're spoiled).

Now tell me a relabeler is going to spend 3 years to develop anink.

That's the clincher. At Kodak's prices it is going to make it
virtually unprofitable for the relabelers and compatibles to produce
knock-off inks.

I think that is terrific. I wish Canon, Epson, and HP would also drop
their prices forinkin half (and maybe raise the printer price some)
and drive the relabelers out of the business. Then we will have some
consistency and professional labeling.

And what about other microporous paper?

I don't think Kodak's microporous paper is going to be much different
than some of the good "premium" microporous papers out there already,
but it will often come as a package deal with the inks. If the soccer
mom gets terrific looking prints at a great price, she's not going
look any further for competitive products.

If this Kodak printer is any good then I hope they make a dual paper
feed wide format printer as well.

Royce Bair
Tips, news, reviews and resources...
http://www.InkjetNEWSandTIPS.com/

Check outhttp://www.inkisit.com

It may appeal to some...low-level types.