Epson’s EcoTank Rollout for North America: Is the Old Ink Cartridge Doomed?

by Robert Palmer | 8/615

On August 4, Epson finally rolled out its EcoTank inkjet platform for the North American market. The EcoTank system was actually introduced in the UK last year and has also been made available in other regions, often with great fanfare and expectation. With its EcoTank solution, Epson is hoping to transform the traditional printer business by replacing ink cartridges with large, refillable ink tanks that come loaded with enough ink to last up to two years in certain applications.

For North America, Epson has introduced five new all-in-one EcoTank models. Epson says its new EcoTank products are designed to eliminate the most common pain points experienced by inkjet users: running out of ink and the high costs of color printing. According to Nils Madden, marketing director for consumer inkjets at Epson America, the traditional printer business model is no longer addressing the needs of today’s user. “The market is ready for something new,” he proclaims. “We are ready to unveil the new age of printing.”

What Madden is referring to, of course, is the tried and true “razor-and-blades” model that has served the printing business so well since its inception. Users pay a low upfront price for a printer or MFP, and then shell out big bucks for replaceable supplies that are consumed over the life of the printer. Over the course of the product lifespan, consumers typically pay more for consumable supplies than they do for the hardware itself. This is true in most segments of the market and with both imaging technologies — ink and laser. Nevertheless, it has been particularly problematic in the consumer inkjet space.

The concept of the EcoTank platform is quite simple. Instead of using integrated cartridges that in many cases are comprised of a print head and a low-yield ink tank, the EcoTank models are equipped with permanent print heads that are supplied with ink from high-yield reservoirs, each of which can be refilled with a simple squeeze from a replacement ink bottle. Each EcoTank MFP ships with four bottles of ink — one for each color (CMYK) — and the user must fill the empty tank as part of the initial setup. Each bottle essentially holds enough ink to fill each corresponding color tank.

Epson’s claim of two years worth of pages is based on average monthly print volumes consistent with usage rates for various target customer segments. Meanwhile, if and when replacement ink is needed, the cost to refill the printers is very economical. The replacement ink sells for as low as $12.99 per bottle, or $52 per set of four bottles. By comparison, Epson claims that a standard home printer requires approximately 20 sets of cartridges to print the same number of pages that can be printed with an equivalent EcoTank model.

Reversing the Business Model

There are five total models in Epson’s new EcoTank family. Interestingly, however, one of the new models offers a slightly different configuration and value proposition. The Workforce ET-4550, Workforce ET-4500, Expression ET-2550, and Expression ET-2500 all are based on the refillable ink tank system. The standard capacity for the ink reservoirs is different based on the model. Nevertheless, even the low-end ET-2500 comes standard with enough ink to print 6,500 color pages before it needs to be refilled.

The benefits to the user are easy to understand: more pages printed, fewer interventions, and lower operating costs over the life of the printer. Of course, there is always a catch, and in this case users must expect to pay more up front for the cost of the hardware. Basically, Epson is attempting to reverse the traditional business model — pay more up front for the hardware to subsidize the cost and convenience of long-life consumable supplies. It is an interesting strategy that will likely appeal to many users.

Even so, there might be some sticker shock for those who do not fully understand the EcoTank value proposition. For example, the Expression ET-2500 EcoTank All-in-One, which is designed for home users, offers an in-box ink yield of up to 4,000 black and 6,500 color pages with print speeds of up to 9.2 ppm for black and 4.5 ppm for color. The device offers one-touch copying and a 100-sheet paper capacity. The ET-2500 also has an estimated street price of $379, which is a pretty hefty price tag for a consumer-class MFP. Competitive models with similar features and functionality typically sell for $99 or less.

The other EcoTank models based on the refillable ink tank system include the Expression ET-2550 EcoTank ($399), WorkForce ET-4500 EcoTank ($429), and WorkForce ET-4550 EcoTank ($499 MSRP). The latter model, which is designed primarily for the home office, has an in-box ink yield of up to 11,000 black and 8,500 color pages. Again, $499 is quite pricey for a low-end MFP with a maximum print speed of just 13 ppm for black and 7.3 ppm for color. But according to Madden, the machine has a high-capacity tank with enough ink to print 17 reams of paper. “With the disposal cartridge model, it would take you 50 sets of disposal ink cartridges to print 17 reams of paper.” He says.

RIPS-Based EcoTank Model

The last model in the new EcoTank family is the Workforce Pro WF-R4640 EcoTank All-in-One, which is considerably different from its sister products. This machine is designed for small business but is not based on the refillable ink tank platform. Instead, it leverages the Replaceable Ink Pack System (RIPS) that Epson unveiled earlier this year with other products aimed at business users (see story here.)

The RIPS platform uses high-capacity ink bags that feed ink to the print head through a tubing system. The bags provide for a higher page yield but they are not refillable. Instead, each bag must be replaced once it is depleted. Nevertheless, the WF-R4640 has an in-box ink yield of up to 20,000 black and 20,000 color pages, with print speeds of up to 20 ppm (black and color). With a street price of $1,199, users will need to fully understand the business model behind the WF-R4640 in order to justify the upfront cost of the hardware.

It is also worth noting that Epson is offering a two-year limited warranty with its new EcoTank models. The WF-R4640 comes standard with the two-year warranty, while the other models have a 12-month standard warranty but users can receive an additional 12 months (total of 24 months) once they register the machine and agree to use Epson genuine ink bottles.

Interestingly, Epson is attempting to create a new printer category with the launch of its EcoTank printers. In its press release, Epson positions the EcoTank machines as part of the Supertank category, which is basically a name that Epson is unveiling for a category that does not yet exist. The firm is hoping that market research firms will recognize the category and position it separately as more ultra high-capacity inkjet products come to market.

Epson will offer the EcoTank products through its retail channel partners beginning in September. According to Madden, Epson is going big and broad with its retail distribution. “We will have the majority of our channel locked and loaded,” he says. The EcoTank products will be carried by major computer, office, and electronic superstores, including Staples, Best Buy, Office Depot, Amazon, Microcenter, Costco.com, Samsclub.com, Target.com, Walmart.com and direct through the Epson online store.

For more Epson’s EcoTank products, see press release here.

Our Take

Epson’s new EcoTank products are interesting in a number of ways. Numerous vendors, including Epson, have been pushing inkjet-based products in an attempt to disrupt the traditional printing paradigm. In the workgroup segment, Epson is utilizing its Workforce products and RIPS-based platform to offer devices with high supplies yields and very low operating costs as an alternative to laser. Now, the firm is targeting SOHO and small business with the EcoTank platform.

Attacking the traditional razors and blades model is a bold move by Epson, and it will be interesting to see how the market reacts. HP is making a similar move by promoting subscription based printing services that allow users to pay monthly fees based on the number of pages printed. In both cases, these new business models provide users with a new way to acquire printing services while addressing barriers such as color operating costs and user intervention issues.

Nevertheless, the EcoTank platform marks a radical change for Epson. Historically, printing vendors have done everything possible to prevent use of refilled cartridges. Now, it is embracing a refill strategy. Protecting these machines from third-party inks might prove difficult since they are designed specifically to accommodate refilled ink tanks. Presumably, Epson will put systems in place to help ensure or at least detect whether its own branded inks are used with the products.

It is also interesting that Epson is offering a RIPS-based product through the retail channel. Epson’s other RIPS-based machines are sold exclusively through its commercial channels. This represents some potential conflict, but should be manageable for Epson with a cohesive channel strategy that provides some level of differentiation and protection for VARs and dealers.

While this first round of EcoTank products is interesting, these machines are clearly aimed either at consumers or the very low end of the small business category. It is perhaps more interesting to consider how Epson might be able to further disrupt the market with EcoTank products aimed at the office workgroup space. Consider an ink-based workgroup MFP that was equipped with enough ink to last for two years. What if that machine also came standard with a two- or three-year warranty?

What we could be talking about here is an office-class inkjet product that would virtually never require service while offering per-page printing costs much lower than laser. The hardware itself might be more expensive but the overall operating costs would be much lower over the life of the product. It is interesting to consider what this type of product could mean for customers and for the office channel. How likely such a product might be is hard to say. Nevertheless, Epson is clearly making significant strides with its inkjet technology, which is pushing further and deeper into the office printing market. 

Robert Palmer is chief analyst and a managing partner for BPO Media, which publishes The Imaging Channel and Workflow magazines. He is an independent market analyst and industry consultant with more than 25 years experience in the printing industry covering technology and business sectors for prominent market research firms such as Lyra Research and InfoTrends. In December 2012 he formed Palmer Consulting as an independent consultancy focused on transformation, mobility, MPS, and the entire imaging market. Palmer is a popular speaker and presents regularly at industry conferences and trade events in the U.S., Europe, and Japan. He is also active in a variety of imaging industry forums and currently serves on the board of directors for the Managed Print Services Association (MPSA). Contact him at robert@bpomedia.com.