I looked up the model number, and two interesting facts are not pointed out (as Sebastian probably did not expect this to appear all over the internet).
The first fact is that HP offers the printer and cartridges at similar prices on their web site. This means the discrepancy is not due to a crazy sale on Amazon. Even according to the HP web site, the price of four replacement cartridges is $822, while the price of the printer (which includes the cartridges) is $699. Though Amazon reports that at some point, the printer may have been sold for up to $885 since it was launched in October, that's still almost identical to the cost of the cartridges.)
Second, also by design, the printer comes with the full cartridges, not starter ones...
1) HP makes a profit when people buy this $699 printer (though not as large as when they sell four ink tanks without a printer for $822);
2) Every printer re-purchase helps maintain their 40% marketshare in the printer business, if it's measured by printers sold rather than cartridges sold;
3) Every printer re-purchase keeps a sale away from Brother or another competitor;
4) HP's printing division has now been merged into the declining PC division, so nobody would notice the declining printer margins amongst lower-margin PC's anyway.
"HP's new CEO Meg Whitman, who calls the printing division "the lifeblood of HP," responded to the decline by folding it into the PC division, which saw a 15% drop in revenue last quarter. That will solve one problem: concealing the extent of the decline in HP's printer margins by blending it with lower-margin PCs. More practically, it could give HP greater leverage in negotiating prices with component suppliers."
Comments
I looked up the model number, and two interesting facts are not pointed out (as Sebastian probably did not expect this to appear all over the internet).
The first fact is that HP offers the printer and cartridges at similar prices on their web site. This means the discrepancy is not due to a crazy sale on Amazon. Even according to the HP web site, the price of four replacement cartridges is $822, while the price of the printer (which includes the cartridges) is $699. Though Amazon reports that at some point, the printer may have been sold for up to $885 since it was launched in October, that's still almost identical to the cost of the cartridges.)
Second, also by design, the printer comes with the full cartridges, not starter ones...
http://h10010.www1.hp.com/wwpc/us/en/sm/WF28a/18972-18972-33...
I can only imagine that:
1) HP makes a profit when people buy this $699 printer (though not as large as when they sell four ink tanks without a printer for $822);
2) Every printer re-purchase helps maintain their 40% marketshare in the printer business, if it's measured by printers sold rather than cartridges sold;
3) Every printer re-purchase keeps a sale away from Brother or another competitor;
4) HP's printing division has now been merged into the declining PC division, so nobody would notice the declining printer margins amongst lower-margin PC's anyway.
"HP's new CEO Meg Whitman, who calls the printing division "the lifeblood of HP," responded to the decline by folding it into the PC division, which saw a 15% drop in revenue last quarter. That will solve one problem: concealing the extent of the decline in HP's printer margins by blending it with lower-margin PCs. More practically, it could give HP greater leverage in negotiating prices with component suppliers."
From: http://tech.fortune.cnn.com/2012/03/29/hps-printer-problem/