September 21, 2012 in Business

Starbucks joins single-servers

Brewer to sell online this week
Candice Choi Associated Press
 
Associated Press photo

Hannah So demonstrates a Verismo, a single-serving espresso machine from Starbucks, in Seattle this spring.
(Full-size photo)

NEW YORK – Starbucks Corp. is turning up the heat on the single-serve coffee market, and someone might get burned.

The Seattle-based company says it will start selling its new single-serve brewer online this week for $199. The machine will be rolled out in its ubiquitous cafes next month.

The arrival of the Verismo, which was announced earlier this year, comes amid intensifying competition in the piping hot market for single-serve brewers and the coffee pods they use.

The sector is currently dominated by Green Mountain Coffee Roasters Inc., which pioneered the market after its acquisition of the Keurig brand machine in 2006. But this month, the company’s patent on its K-cup technology expired, which spawned copycat versions of coffee pods for Keurig machines.

Starbucks’ decision to sell its own brewer comes less than a year after it struck a deal with Green Mountain to make coffee pods for Keurig machines. Now Starbucks is looking for a bigger piece of the pie.

Starbucks CEO Howard Schultz said the relationship with Green Mountain will continue and that Starbucks will still sell its pods for Keurig machines in cafes. He said the Keurig machine is “a fantastic choice” for customers who want only brewed coffee.

The Verismo, however, uses a high-pressure system that can make lattes and other espresso-based drinks, as well as brewed coffee. Essentially, Starbucks has said its machine targets a different type of customer.

“They’ll coexist and be complementary,” Schultz said.

© Copyright 2012 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.


Thoughts and opinions on this story? Click here to comment >>

Get stories like this in a free daily email