July 12, 2005 in Business

HP boosts technology for inkjet printers

Associated Press
 

NEW YORK — Hewlett-Packard Co., striving to remain the market leader in computer printers, launched a new technology for inkjet printers Monday that cuts photo printing time in half.

The first printer with a printing head made with the new technology will be a $199 machine that can print a 4-by-6-inch photo in 14 seconds. It goes on sale later this month.

HP is following up this fall with a heavier-duty printer intended to supplant color laser printers for office use and a multifunction machine that also scans and faxes.

As is usual with inkjet printers, the fastest printing mode means a trade-off in quality. Printing a 4x6 picture on the most durable paper at the highest quality setting would take 80 seconds even on the new printer. But analysts agreed that the 14-second prints would be more than good enough for most home users.

The new technology comes at time when HP, while still the largest maker of inkjet printers, is fighting aggressive competitors. Its share of the U.S. inkjet market dropped 12 percentage points to 35 percent in the first quarter this year, according to research group Gartner Inc.

The segment is critical for HP.

Despite former chief executive Carly Fiorina’s drive to diversify the company, printing and imaging accounted for 60 percent of HP’s operating profit in the quarter ended April 30. Fiorina was forced out earlier this year when that drive appeared to founder.

Faster printouts could help HP regain some clout in the market, but the development is unlikely to be decisive, said Ron Glaz, analyst at IDC.

“Printing speed is important, but I don’t think it’s the number one thing when people go shopping,” Glaz said. He believes image quality and cost per print are more important considerations.

HP also addressed the price issue Monday, saying a 4x6 print can cost as little as 24 cents for customers who buy its “value packs,” which combine paper and ink. That makes it competitive with Main Street photofinishers who print on traditional silver halide paper.

Competitors, particularly Dell and Lexmark, have been encroaching on HP’s lead by cutting their prices and bundling printers with computers, said Gartner analyst David Haueter.

“This seems to be a pattern we’ve seen before — competitors gain on HP by slashing prices, then HP introduces new technology that lets them move ahead,” Haueter said.

It cost HP $1.4 billion to develop the new inkjet head and it took five years, an investment HP says it is sure will pay off.

“It gives us a huge manufacturing cost advantage,” said Vyomesh Joshi, head of the printing and imaging group. “We want to get our cost structure right and regain our market share.”

Inkjet heads are built in thin layers. One layer heats the ink and sends it through microscopic nozzles in another layer.

Until now, HP has made the layers separately and assembled them mechanically. In the new heads, the assembly step is eliminated. The nozzle layer is created on top of the lower layer by photolithography, the same process that is used to make computer chips.

The new process is much more precise, making for more efficient print heads with more nozzles that print faster. The new printers have more than 3,900 nozzles spitting out 93 million ink droplets per second.

Another advantage of the new technology is that it makes it easier to make large inkjet heads with even faster printing speeds for industrial applications.

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