Posted on 02/03/2003 8:33:38 AM PST by newgeezer
To print: or Select File and then Print from your browser's menu
-------------------------------------------------------------- This story was printed from Anchordesk, located at http://www.zdnet.com/anchordesk. --------------------------------------------------------------
| Red alert! It's the great printer refill rip-off By David Coursey, AnchorDesk February 2, 2003 9:00 PM PT Consumers and digital-rights advocates have a lot at stake in a lawsuit that, at first, seems fairly simple. It's the battle between printer giant Lexmark International (the bad guy) and little Static Control (the good guy) over the right to manufacture Lexmark-compatible printer supplies. The two companies are scheduled to square off Feb. 7 in a Lexington, Ky., federal courtroom. But while the issue seems at first to be about printer cartridges, it could impact how many other items are designed and manufactured. HERE'S THE GIST: Lexmark recently began building a small computer chip into each of its replacement toner cartridges. Without that chip, the printer won't work. This tactic is supposed to ward off companies like Static Control that manufacture aftermarket cartridges. Static Control responded by creating its own version of the Lexmark chip, which allows its replacement cartridges to (once again) work in Lexmark printers. On Dec. 30, Lexmark filed suit against the company, claiming the Static Control chips violate its copyright on the intellectual property each chip contains. One reason this case matters is the economics of the printer industry. The business model for printers is the same as the model for TiVo, cell phones, and even razor blades. In each case, the hardware itself is sold below market value (even below cost sometimes), and the "consumables" (monthly fees, airtime minutes, razors, or, in this case, toner and ink cartridges) provide the ongoing profits. That model explains why printer cartridges cost so much. (Don't believe me, go over to ZDNet Shopper and check the prices there. We're talking $50 to $100 for toner cartridges, $20 to $50 for ink refills.) Those prices, in turn, explain why companies like Static Control--whose main business is making those antistatic plastic bags that electronics parts come in--can make a buck selling knock-off replacement cartridges. (In many cases, the third parties collect, refill, and sell used original equipment cartridges). I DON'T LIKE this business model. For one thing, I think it distorts the marketplace. Printer manufacturers get people in with a cheap up-front offer and then charge them an arm and a leg once they're hooked. Who hasn't looked at a $50 bag of OEM inkjet cartridges and not felt ripped off? Higher, more realistic prices for printers, coupled with a more competitive supplies market, would be better for consumers. Then there's the environmental angle. The European Union has already blocked the use of chips in printer cartridges, claiming that their use increases the number of such cartridges that end up in landfills. The chips, in other words, are an environmental threat. The chips have also spawned another creative use of the Digital Millennium Copyright Act (DMCA). That law was originally intended to curb the copying of movies and music. But in December, Lexmark filed a DMCA claim against Static Control, saying that the latter's chips circumvented the measures Lexmark had taken to protect its intellectual property. If this legal strategy is successful, how long will it be until all sorts of products include small chips just to head off competitors? If you can imagine a world in which the only parts we could buy for our cars came from the original manufacturers, and were priced accordingly, you get the idea. I'm not in favor of Lexmark, or anyone else, losing control of its intellectual property. But I do think printer cartridges should be fair game for competition. That might eventually force real world pricing on an industry that today seems more drug pusher (get 'em hooked and make 'em pay!) than high-tech. This case also gives us yet another reason to revamp the DMCA, this time with closer attention to preventing unforeseen applications like this. Which side are you on? Does Lexmark have the right to keep other companies out of its printer-supply business? Or should we have access to printer supplies from other vendors? Take my QuickPoll above and TalkBack to me below! |
But if this business model is protected by the courts, and adopted; then the road is paved for American and foreign car companies to use this technology to sell gas at whatever price they deem appropriate. By the car at below market value, and be 'locked' into a particular brand of gas at any price per gallon is deemed fitting. Failure to pay the 'extortion' means that property you OWN will not function, not because of incompatability of materials, but due to intentional 'sabotage' built into the technology.
In the free market system, which I support, you can buy your consumables anywhere you like, from anyone. If you want Lexmark ink, because it lasts longer, or prints better; they can charge more and some people will buy it. If it's inferior to another company's ink; they will be forced to eithe improve their product or fall aside; like any other 'real world' business. The difference boils down to 'Open Market' vs 'Closed Market'.
So, find a printer that accepts the fluid of your choice. If no one makes it, and you're convinced there's a market for it, start your own printer company.
...anyone who perceives the market is not served well enough by the current crop of players is free to start up his own company, and the consumers will come a-runnin'.
I agree, reverse engineering for profit is wrong. However, intentionally 'sabotaging' a product to prevent competition is wrong too. When you purchased your printer, were you warned that refills were technologically prevented from working, unless you bought Lexmark ink? There is nothing wrong with the materials, or the function of the competition. Competition has been prevented from working by 'technological sabotage'. Compare this to your car. If you install a new tire, should the tire cause your engine to refuse to start?
Well, since they were giving it away for free, I kind of assumed that there was a catch.
But I'm not stuck with anything. I can pitch that Lexmark out with the morning trash and get a new printer delivered the next business day, if the cost of replacement cartridges is not to my liking.
And that is your response to technolgical sabotage? I should deal with the extortion, or go start my own company?
I was wondering how they were planning on getting around the "home-refill" kits. This is going to kill Lexmark as more and more people switch to digital photography. The photo-grade color injet printers use so much ink that there are aftermarket bulk ink supply kits. Literally jars of ink, attached to the print head via plastic tubes attached to modified ink cartridge bodies.
A shutdown circuit will only send people in search of some other company's printer. If *all* printer manufacturers adopt that scheme, people will devise a way around it.
Precisely.
What, you can't look around for consumables and price them on your own before you buy the printer?
I guess we expect the government has by now regulated everything so completely that no one will ever again fall victim to the old lesson formerly known as "live and learn". The School Of Hard Knocks is officially closed. Caveat emptor no longer applies. This is America, where consumers are no longer burdened with personal responsibility.
What's to stop them? Almost all new printers from all manufacturers are built and sold like this.
Really? It's only because Compaq reverse-engineered IBM's BIOS that we have ridiculously cheap computers today. Reverse engineering should not be illegal. If you buy a product, you should be able to examine it.
It is Lexmark that needs to learn that their business model is moronic. In a free market it would never work; they're trying to use the DMCA as a protectionist weapon to eliminate competition.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.