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10/9/2002
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The Next Battleground: Printer Cartridges

Speaking Wednesday at a Gartner Symposium, Dell says its cartridges won't be compatible with HP goods, but it will push cartridge costs down.

Dell Computer and Hewlett-Packard continue to toss their heads, this time over printers. In the latest tit-for-tat exchange, Dell says the ink-jet cartridges that it's developing with printer maker Lexmark Corp. won't be compatible with HP equipment.

Speaking Wednesday at a Gartner Symposium, CEO Michael Dell said that while the products won't be compatible with HP goods, Dell will push cartridge costs down. "The price for the total offering--printer and supplies--can come down quite considerably," wire reports quoted Dell as saying. "If you look at any other market Dell has gone into, we have been able to significantly save money for customers."

Printer makers, including Lexmark, generally sell printers inexpensively in the hopes that buyers will keep coming back for parts like the lowly cartridge, which is a more profitable item in comparison.

HP CEO Carly Fiorina blasted Dell's printer plans Tuesday. Fiorina said the company wouldn't invest in the R&D needed to enter the industry on its own and that Dell would wind up being "a channel of distribution for somebody that owns the product." The strategy, she said, wouldn't prove profitable. On Wednesday, Dell didn't address Fiorina's comments directly but said that his company is, in fact, a direct channel, adding, "We think that working directly with customers makes more sense." He promised more details on the printer deal early next year.

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