Digital BW, The Print

Keith:

Doesn't your logic apply as well to Gilette practically giving away
razors and charging dearly for the blades? I'm a real believer that
open markets, the old law of "supply and demand", and traditional
economics do much better than any government regulation. Over the
years we've worried about regulating such virtual monopolies as Xerox,
IBM, AT&T, even Wordstar (for us old timers) and their pricing
structures. I just view this issue is one of more educated consumers
coming out ahead. More government regulation won't help anything. 

Bob Michaels

 --- In DigitalBlackandWhiteThePrint@yahoogroups.com, "Editor P.O.V.
Image Service" <editor@p...> wrote:
> 
> 
> Bob_Michaels wrote:
> 
> >Printer manufacturers have to recover their development and production
> >costs plus some profit from the total sales of both printers and
> >supplies. 
> >
> <SNIP>
> 
> OK, let's talk ETHICS instead of $$ in your pocket... Since using $
as a 
> measure of ethics gets us ENRON etc..  The fact is that a market with 
> pricing skewed to have artificially low printer costs (to entice
buyers) 
> and artificially high consumable costs is less than ethical. 
Imagine if 
> people purchased automobiles with no idea what their gas mileage might 
> be until they actually got to running the car. (Analogous because, 
> unlike gasoline, printer companies have fought the commodification of 
> inks)  R&D is then funded, yes, by the consumable sales.
> 
> But, just because a certain business model personally gives me the best 
> return on my cash does not mean I feel it is ethical OR, more clearly, 
> that it is "good for most of us."
> 
> Taken to extremes in your scenario, for example, chipping would be full 
> proof against using third party inks in your machine. Surely that would 
> BETTER ensure the recovery of R&D expenses by EPSON, HP, Lexmark, et 
> al..  This process is called "tying," and traditionally it is seen as 
> anti-competitive and a restraint of trade. Why?
> 
> I'll give a few simple examples..
> 
> Well, first, vendors with an established supply chain are inordinately 
> favored to the detriment of new entries into the market.  You cannot 
> successfully pursue such a path UNLESS you have the financial resources 
> and margin to absorb the initial pricing costs to then allow you to
sell 
> the printer at a below market value price..  This kind of dumping 
> becomes a way to clear the market of competition and restrict the 
> suppliers to a small established few.  That disadvantages us all. 
>  That's why this kind of tying and cross-subsidization becomes more 
> disfavored as a particular product's market penetration increases.  It 
> creates a situation where pricing does not drop in accord with what 
> should be attendant commodification. Instead, that inefficient pricing 
> structure is artificially supported  by a cartelization of sorts..
> 
> Secondly, consumers are misled by low entry costs but inordinate 
> continuing operational costs.  It's an inefficient way to manage what 
> should be straightforward distributions of resources.  Someone buys an 
> $80 printer to find out each of two cartridges lists for over $50... 
>  With automobiles as an example again, consumers can fairly estimate 
> operational costs.  With printers the data is purposely deceptive on 
> that point.. It's as if someone promised you a free car, you think the 
> deal is great and take the car.  Suddenly, you find that you can use 
> only the OEM brand of gasoline at $30 a gallon...!  What may have
looked 
> like a great deal was simply a shell game.
> 
> Thirdly, these artificial supports encourage short-cutting and are more 
> likely to result in problems like the "orange-shift" (incomplete R&D), 
> and "consumable QC problems or whatever, as we have seen with EEM." 
>  When your competition on a commodity is artificially restricted, the 
> level of innovation and pace of innovation slackens, it's a proven 
> economic fact.
> 
> So, the current strategy REALLY benefits ONLY those happiest with 
> today's level of technology, who are going to buy current printers, and 
> use non-OEM inks and non-OEM papers.  The vast majority of users don't 
> fall into that subset by any means.
> 
> I shall assume, since you say that you are happy with the current
state, 
> you won't need to upgrade to other printers as the technology improves? 
>  If not, then you should be against the cost-shifting, simply
because it 
> slows technological progress AND limits the numbers of entrants with 
> potentially innovative products - neither is a positive in a true free 
> market..
> 
> THe OEM firms have had quite enough time to apply this business model. 
>  Just as copier manufacturers had to abandon it as copiers became 
> ubiquitous, so will inkjet manufacturers be forced to adjust as inkjets 
> are becoming similarly common.  
> 
> Do I benefit from the current situation? YES.. Does that mean I
think it 
> is RIGHT and should continue? NO..
> 
> I'm a white/anglo American.   Might I have benefited more in a society 
> where racial/gender equality were not goals and affirmative action had 
> not been fact?  Probably so...  and I'm not putting printer inks and 
> paper on the level of racial equality... what I am doing is pointing
out 
> that overall ethics in the marketplace can encourage us to be
monetarily 
> altruistic in the short term for long-term general benefits to the 
> market or the community at large..
> 
> Keith
> 
>  
> 
> "Just some guy," and caretaker of the Multiverse's largest EPSON
printer 
> User Community (highly recommended by Vogon Poets and MegaDodo 
> Publications), at:
> 
> http://groups.yahoo.com/group/EPSONx7x_Printers/
>  
> "For the rest of you out there, the secret is to bang the rocks
together 
> guys"
> 
>  
> 
> 
> { The P.O.V. Image Service Website is still at
http://www.p-o-v-image.com/ }
> 
> 
> 
> 
> 
> 
> [Non-text portions of this message have been removed]