Ink Scam!

Controlling the Price of Ink – What Can Consumers Do?

Study Finds Consumers Overcharged for Inkjet Cartridges

 

A recent study by the American Consumer Institute looked at the inkjet printer and ink cartridge market and found that consumers are losing billions of dollars due to overpriced ink.  Because consumers are not given sufficient information of the cost of printing, they are frequently lured into buying what appear to be inexpensive printers, only to find they will pay substantially more for ink.  The lack of information has led to increased industry prices, excessive profits and higher market concentration.  The study finds that, by simply giving consumers better information on the cost of printing, consumers would save $6 billion per year in lower ink prices.



 

Cheaper Printers, Pricy Ink

 

With the spread of computers into the average household, the costs of related technologies have become a source of rising concern to consumers, including an increased awareness of computer printing costs.  While inkjet printer prices appear to be affordable, some consumers have expressed dissatisfaction, alarm and frustration over the price of inkjet printer ink cartridges.  When buying printers or getting free printers with the purchase computers, consumers receive too little information on printing costs.  Once a consumer buys and begins to use their ink jet printer, they have no choice but to buy expensive ink.  This had led to many consumers into paying more for ink in just one year than the cost of the printer itself, and (as shown below) more per milliliter than other more exclusive items.  In fact, according a study – “Inkjet prices, Printing Costs and Consumer Welfare” – written by TeleNomic Research and released by the American Consumer Institute, not only are inkjet prices exorbitantly high, but they have, by one estimate in the study, increased many times faster than the rate of inflation. 

 

 

Comparison of Luxury or Costly Liquids

Price per Milliliter

 

                      Company                                                     Price/ML       

Multicolor Inkjet Cartridge

$ 5.14

Black Inkjet Cartridge

$ 3.33

Prada Atomizer Parfum

$ 1.19

Dom Perignon Champagne (1998)

$ 0.17

Gasoline

< $0.01

 

 

 

Prices Increasing, Consumers Losing

 

The study reports that inkjet printers are priced with little or no margin and, according to some authorities, well below cost in many cases.  The immediate result is to impede market entry.  Moreover, because these cartridges are seldom interchangeable between different printer models, there appears to be diminished price competition in the inkjet cartridge market.  The combination of the lack of price competition and barriers to entry has resulted in a concentrated market, as depicted below. The lack of competition has led to high ink prices and profits, according to the study.

 

 

 

 

 

The available evidence and this study’s analysis suggests that competition in the inkjet printer and ink sectors is not as intense as it would be, if consumers were made more aware of the cost implications of their printer choices.  Potential impediments for maximizing consumer welfare and “red flags” in the printer and ink sectors include: 

 

·        High seller concentration in the industry;

·        Imperfect information-based barriers to entry;

·        Rising inkjet cartridge prices;

·        Supernormal inkjet profits for integrated suppliers;

·        Reduced consumer demand and use of printers and ink; and

·        Overall reductions in consumer welfare.

 

 

 

 

Information is the Key to Increasing Consumer Welfare

 

Market alternatives convey value to consumers, but the value of competition and product alternatives for consumers is attenuated if consumers have insufficient information to choose rationally among them.  Competition is present, but can and should work better on behalf of consumers.  Providing consumers with better information would allow them to make better choices that suit their printing needs and minimize their costs for doing so.  That, in turn, would provide added discipline in the marketplace and encourage price competition that results in lower consumer costs for the combined purchase of the inkjet printer and its corresponding ink.  In that general context, the study estimated that increasing consumer information and competition would avail sizable consumer welfare gains, conservatively estimated to be $6 billion per year once increased competition is fully realized in the marketplace.  Unfortunately, ink is one of a handful of products that are exempt from Federal Trade Commission regulation under the Fair Packaging and Labeling Act.  This means that the printer oligopoly can “slack fill” their products and profit from it. 

 

 

What Can Consumers Do?

 

Until the industry is mandated into providing better consumer information, consumers should insist on better information before they purchase a printer.  For consumers, the first step is to consider the amount of printing that you do in your home each year.  For example, some consumers do very little printing, so ink costs will not have a substantial effect on consumer costs.  In this case, a cheap printer may be suitable, depending on the quality of your printing needs.  On the other hand, the vast majority of consumers print hundreds, even thousands, of pages per year.  For this majority, ink costs do matter.  In general, we recommend the following cost saving tips for consumers who print more than 1-2 pages per week:

  • Do not buy a printer without knowing the estimated cost per page (monotone text, graphics and photos) and the cost of the refill cartridges.  These costs are available, but seldom displayed. 
  • Free and low cost printers, often pushed by major electronic stores, are often the most costly printers to use in terms of ink.
  • As a benchmark, a printed page of black text costs should cost in the 2-3 cent range, which would produce cost savings of approximately 60% over the average printer.
  • If you are not in an immediate need for a printer, you can buy refilled cartridges for your current printer.  However, be warned, these cartridges tend to have higher failure rates, so buy them only from reputable dealers who will facilitate any easy and costless exchange. 

 

Finally, let us know your experience with ink jet printers and ink cartridges.  Have you had problems or successes in dealing with the cost of ink?  Should the law be changed to provide better package labeling?  Please send your comments to info@theamericanconsumer.org.  

POSTED:  September 16, 2008

 

 

About The American Consumer Institute Center for Citizen Research

The Institute is a nonprofit educational and research institute. For more information or to contact us, visit http://www.aci-citizenresearch.org.  This ConsumerGram is provided as a free service to consumers.

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Comments

  1. Nancy L. says

    Why don’t they label their products? The problem is that this has been going on for so long and no one seems to care or is doing something about it. The cartridges give me about 80 pages and just run out. It a waste. My advice, don’t print unless you have to.

  2. Michael P. says

    This is a big consumer problem that affects everyone in today technological society. Almost everything done in the 21st century is done via computers (word processing, shopping, research, etc.). So, it is really no surprise that printers are becoming more and more essential in this day and age. I recently bought an All-in-one HP printer for college at a fairly reasonable price. The Ink cartridges lasted me about one semester of printing, so roughly 200 sheets. When I later went out to buy new ink cartridges, I ended up spending a little more on them than I did on the printer itself. Following the purchase, I couldn’t help but feel like I just got ripped off. After more thinking about the issue, I realized that I was basically a victim of an overpriced monopolized good. It’s really a shame because I know that I’m not the only one who has fallen into this trap. Either more consumers should be aware of this problem, so that they can make better economical decisions when buying, or even possibly some sort of regulation.

  3. Dan B. says

    So are there ANY printers that don’t have outrageously priced legit refill cartridges?

    Hard to believe this scam has been going on for 10 years, and no upstart company has cut through the BS.

  4. simon says says

    I think there are printers that use ink priced 60% less than the average, but the retailers don’t advertise ink saving, only the printer cost savings. Some have “give away” printers when you buy their PC. However, the ink will cost you more than the printer is worth in just 6 months. Consumers lose because the information is hard to find.

    The other option is to refill your cartridges, which can cost costs in half, but the quality is not always the best.

  5. John says

    Get a laser printer for black and white printing! Cartridge lasts for years if you don’t print a lot. i believe there is some overcharge for laser printer toner too, but in a long run you get more than with ink printers.

  6. says

    I have an Epson Stylus CX4400 printer/scanner which I use for creating animated cartoons, and those ink cartridges run out suspiciously fast. I have hardly used the print feature (as most of my work involves scanning), so when I DO go to print, I EXPECT there to be INK. I have printed LESS THAN TEN COLOR PAGES in the six months or so since I purchased this printer, and I am supposedly out of ink?!? That is some bull….I will say that I am very happy with the printer itself. It is easy to use, nicely constructed, and when I “have ink” it prints reasonably well for an inexpensive printer (about $60 if I recall) BUT we’re talking TEN PAGES!! Perhaps they just dried out. Hmmmm….

  7. Mike says

    So, when households buy a ink jet printer, what is the main purpose of using color inc? Print pics or greeting cards?
    What most do you use your printer’s color function?

  8. Bruce says

    Is there no way for the government to require labeling of the quantity of contents of these ink cartridges. Everything else is labeled as to weight or liquid measure.

    What agency can we appeal to for action against this arrogantly dishonest scam perpetrated on the public? And why can’t we see what we’re buying? Most products are wrapped in a see-thru package.

  9. Constance says

    My satisfaction with my new Epson inkjet printer was shortlived. The ink lindicator showed all tanks to be at healthy levels, but one day it wouldn’t print, said one tank was low (it showed a quarter full). So I made a trip to get a replacement, installed it, tried to print, but it said another one was low (this one was one third full). I could see where this was going, so I bought replacements for all the rest. It made me replace yet another that was one third full before it would print. Not happy. As if the cost of cartridges isn’t enough, with Epson you can’t even use what you buy, and that is lower than low. Now I’m printer shopping again, looking for the least of the evils, I guess.

  10. nikki ty-tomkins says

    Beware of HP Deskject printers. They are a scam. Not only do they supply tiny “sample” ink cartridges with their printers, they’ve rigged it so you can’t refill them, And the color cartrdige must be time-dated to expire. Because I don’t print in color and my cartridge is supposedly “empty”. To top things off, their program is as nasty as any online virus. A hateful “ink level’ screen appears every time I switch on my printer … which reminds me each time that my unused color cartridge is almost empty. Not only are they scamming me, they’re reminding me every day that they’re scamming. Hateful program. I hope enough people wake up to this noxious cheating and boycott them. I’ll never touch a HP again.

  11. Han Joverseon says

    I have an Epson inkjet printer. Not only are the cartriges ridiculously high but they cannot be refilled. Worse, the printer will insist on replacing both cartriges even if the color cartrige is still nearly full1!

  12. says

    I see that many people have a gripe with this issue. But has anyone done any real research? The fact is that there ARE alternatives to overpriced OEM ink!

    The alternative printer supply industry (Compatibles, remanufactured cartridges, bulk ink systems, etc.) is now over $20 billion world-wide. With billions in revenue, this industry is, in many cases, offering products that may surpass the quality of the brand name product.

    One incredible solution is the “Continuous Ink Printer” brought to market by Sohojet. No need to replace cartridges – just pour in ink. Instead of paying $3,000 per gallon for ink, you pay about $100 per gallon.

    All of these alternatives give you fantastic results at incredible savings.

    Everyone should do two things:

    1) Research supply costs BEFORE buying a printer.

    2) Don’t upgrade to new printers until there is an alternative (Reman, compatible, or otherwise) on the market. Printer manufacturers often come out with new printers, and therefore, new cartridges in order to thwart the after-market. They know it takes time for companies to develop alternatives.

    By following these two simple rules, you can reduce your printing cost by over 90%

  13. Michael says

    I just researched and bought an HP 6500 Wireless printer. Now, I looked at Kodak and their “cheap” ink, but page by page, the cost of the 6500′s cartridges were higher up front, but the price per page was so much less. This is the new marketing ploy… Because the average consumer is not going to spend hours like I did to figure out the cost per page to print. Even when the stores or manufacturers say how much each page is, it rarely jibes with the actual numbers you can get for yourself with a little research.
    Now, I’m not promoting HP or the 6500… But for me, for my estimated usage and he type of usage, right now it was the best deal.
    I have afl friend who’s dad designed for HP in the late 90′s. He actually told me that they toted around with the idea of desposable printers because the cost and problem is not the ink, it’s the ink cartridges and print heads. Basically, if you’re looking at one printer that uses , say, a #45 ink cartridge and it has a max dpi of 600… But the next one over has a dpi of 1200 but uses the same cartridge, they’re lying. It’s the cartridge that does all the work. And it’s those tiny little spray nozzles and parts that cost these companies so much. Another issue is them getting clogged. But now the inks are supposed to last longer in the cartridges and so they’re selling these “XL” cartridges. But if you only print 1 page a month, you’ll waste your money because all print cartridges eventually clog/dry up.
    My point is, yes they rip us off.. But it’s our own fault for getting ripped off if we don’t do some research and find the best fit!!!

  14. steve says

    Mike,

    If have just proved that consumers are not getting enough information to make the right decisions about selecting a printer. You, unfortunately, made a mistake in your printer’s ink cost. The printer you selected has 4 cartridges. By just looking at the cost and yield for one cartridge, you have been misled into thinking that it is cheaper. It is not. All of these cartridges are in operation at the same time, to lesser degrees. In fact, the black cartridge runs as you print in color and they fire periodically even when idle to keep the head clean.

    The printer you compared to this model has only two cartridges. So you are comparing $60 of ink in your printer to $20 of ink for the other. The correct way to do this is by weighting the cost per page for all of the cartridges used in each printer. Our analysis does this. While there are many factors that contribute to printer costs (the price of the cartridge, efficiency of the print engine), the more cartridges used in a printer, the higher the cost per page. Also, note that the cartridges that came with your printer will run out soon. They were slack filled to get you started. Now, with all that said, the printer you selected is better than most. And, you are correct, if you don’t print, you don’t save. To take usage into account, see http://www.consumercalculator.com for help.

    I hope that helps the next reader

  15. Frank Murphy says

    I use a Canon printer for photo, and use a lot of ink. I think that there are seven cartridges in the machine. Cartridges are about $10.00 each. I bought a refill kit from “The Printer Filling Station’. Easy to use, and saving $. All cartridges have been filled multiple times without a problem. I have also used “Laser Monks” for refill cartridges for my general purpose HP printers. Just don’t buy bulk until you try one or two.

  16. C Hawk says

    You shouldnt have to chose between printing and not printing based on the price of cartridges. If you spend more on ink than you do in food for a family of 4 there seems to be an issue.

  17. jorgine jensen says

    Type your comment here. My Brother printer is a huge scam. When i am out of just one color it will not print at all! not only that when I remove the “old Empty” cartridge it is NOT empty at all or even near it!AND I had not barely printed more than a couple of pages of color!!!This is forcing people to buy something the same way a Mafia run business forces people to be a consumer against their will! They have cornered the market. AND JUST as important perfectly good printer end up in the landfill because people can’t resell them and no one want to buy!! what an Environmental insult!! The Gov should step in and make stricter regulation on this ridicules market! Make something that lasts is reasonable to run and everyone wins not just the GREEDY big business who are no different that price gougers and MAFIA Monopolizers!! If they were really smart they would look at the important BIG picture and stop encouraging and contributing to this dangerously throw away society!! Can it really be true that no one has the power to stop this OUTRAGEOUS BULLSHIT?

  18. nathan says

    If only someone had enough money to start a buisness to produce off brand ink cartridges so that there would actually be some compitition everything would be great… not to mention all the money to be made

  19. me says

    Just go on ebay, you can buy bulk HP ink that you can inject into your used cartridges. You can get enough ink to refill about 100 color inkjet cartridges with about $60. From my experience you can refill a cartridge quite a few times (roughly about 10) before they start to degrade. Just make sure you don’t get the universal ones that clog your print heads. Using this method I am able to print tons of full color images everyday with just a few pennies.

  20. Henry Tamke says

    SCAM: I have a Lexmark x2480 printer. I print 2 blank crossword puzzles a day using only black ink. I get a message to order more ink well before the ink actually runs out. I have to order a new print cartridge every month at a cost of $30. each. Thats 12 cartridges a year at a cost of $360 a year. SCAM INDEED!

  21. Haresh P. says

    I use after market cartridges and bulk ink. Ten times cheaper than buying from the OEM. The print quality is fantastic. Just need to be careful not to spill ink while refilling but no big deal. I ignored all the scary articles about print head clogging etc. Found no such problem.

  22. Mark says

    When my HP Pro 8500 print heads recently became misaligned I noticed that there was a yellow shadow around my black letters. HP is apparently injecting (printing) yellow ink either into or under the black ink. This means yellow will run out more rapidly.

    This is a waste of yellow ink and stinks of a huge scam.

    • Steve Pociask says

      Most of us do not realize that inkjet heads are firing to keep the heads from clogging — even when idle. There is a lot of waste.

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