Maximizing Profit: How Patents on Laser Print Toner Cartridges Protect the Industry

Have you ever imagined a scenario where a car could only use gasoline from a specific company, and using gasoline from any other company would void its warranty? This is similar to what many printing companies do. To protect the high profitability of their printing products, they hold numerous patents on drums and cartridges, creating a barrier that prevents third-party consumables from being used with their products.

Patents are a legitimate way for companies to protect their innovations, but have they gone too far in controlling consumables?

High Profit Margins in the Printing Industry

While the average profit margin in the IT industry is currently low, the same cannot be said for the printing industry, which generates $100 billion in revenue. Take HP, for example, a major player in both computer and printing products. In its third-quarter financial report released in late August, HP’s personal systems group reported $8.404 billion in sales but had a modest profit margin of only 3.7%. In contrast, its printing systems group had sales of $4.698 billion, with a staggering profit margin of 17.3%. Very few industries offer such high profit margins.

Canon’s Revenue Breakdown

Canon is another well-known example. While most people associate Canon with cameras and imaging products, a close look at its Q3 2017 earnings report shows a different story. Canon reported total revenue of ¥994.49 billion in the third quarter, with ¥270.5 billion coming from its imaging systems business. However, its office equipment business generated ¥444.3 billion, almost half of Canon's total revenue. Clearly, office equipment plays a crucial role in supporting Canon’s business.

Complex Patent Systems Protect Profitability

For printing companies, patent protection on consumables is key to maintaining high profit margins. These companies have developed complex patent systems to protect their products, which has led to numerous intellectual property lawsuits, particularly in countries with stringent legal frameworks. This article highlights some of these patents to offer insight into how they work.

The Twisted Gear Patent

Both HP and Canon dominate the A4 printer market, shipping massive quantities of printers. Their patents, particularly those involving the popular 88A toner cartridges, have been the subject of extensive research. One notable example is Canon’s "twisted gear," located at the top of the drum cartridge, has an unusual twisted triangle shape. If a toner cartridge’s gear doesn’t physically match this design, it won’t fit in the printer. However, if it does, it could lead to patent infringement lawsuits. In recent years, consumable manufacturers in Zhuhai have worked hard to find ways around Canon’s patents.