Giving Away the Printer Charging for the Printer Cartridges

MAY 7, 2007

Printers and their ink cartridges are good examples of of complementary goods. The market is particularly interesting because until recently the printer seller was the only provider of cartridges for that printer. Over the last decade it has become possible for people to get ink cartridges from others in the form of ‘refills’, that is refilled cartridges (it is hard to make the cartridges independently but not hard to refill them. Interestingly manufactuers of printes have tried to stop this practice by ‘locking’ the cartridge to their printer with special microchips – invoking the DMCA where necessary to prevent people reverse engingeering the locks (e.g. Lexmark).

One question of particular interest to me was how rational people were in relation to the complementaries present here. After all when you buy the printer the main piece of information you have is its price. I’ve also been struck by the number of people (and firms) who don’t buy refills even though they cost a fraction of the price of the manufacturer ones (often they may not even know they can get refills). Finally for printers the cost of the cartridges often dwarf the cost of the printer. Thus, I was particularly interested when ‘Which’ magazine (run by the Consumers Association in the UK to provide independent evaluation of products) provided an evaluation of printers in their February issue along with details of the cost of buying and printing with a given printer.