IDC Reports Revenues for Ink Cartridges Market Decline in APEJ while Laser Toner Market Grows

SINGAPORE, April 19, 2016 – IDC reports in its latest Quarterly Printer Consumables Tracker that the Asia/Pacific excluding Japan (APeJ) printer consumable market declined 1.3% quarter-on-quarter and 6.5% year-on-year to reach US$ 1,551.72 million in Q4 2015. Out of the total consumable market, third party¹ vendors contribute approximately US$330 million, which is approximately 21% of the total value.The drop in revenue in the APeJ market was due to the decline in the shipment of ink cartridges which recorded an estimated 5.1% revenue decline quarter-on-quarter while the laser toner market posted a 5.3% quarter-on-quarter revenue growth. Among the major classifications, the originals² market recorded the biggest drop in revenue, a decline of US$15 million from the previous quarter.

“There have been significant developments in the inkjet market especially in 2H 2015, with major OEM vendors launching inkjet hardcopy peripherals (HCPs) which offer ink-tanks that have extremely high page yield at very low cost of print per page (CPP),” says Jeremy Soo, Market Analyst for IPDS Research at IDC Asia/Pacific.

The OEM market is currently undergoing a transition in the business model where printer supplies is no longer the main source for profit but part of the profit margins are now split between printer consumables and inkjet hardcopy peripherals (HCPs). This has affected the revenue of originals as vendors reduce the cost of printer consumables and increase prices of HCPs.

“PRC and ASEAN region are expected to be most affected by the change as these countries contribute approximately 60% of the total ink cartridge shipments in APeJ,” adds Soo.

IDC believes that with all the major vendors such as Brother, Canon, Epson and HP now offering ink-tank HCPs with very competitive prices for printer consumables, the third party market is expected to experience a decline in market share as OEMs regain the upper hand.

However, there are growth opportunities for third party vendors in the laser toner market where there are higher margins. With declining margins in the ink cartridge market, there has already been a shift in focus by the third party brands into the laser toner market with many new third party brands emerging within Asia/Pacific.

With the global economic slowdown from the deceleration in growth in China coupled with impacts from the decline in oil prices, the competitive landscape in the laser toner market will intensify even further with third party products becoming more viable especially in developing economies in the region. Third party laser toners are beginning to gain acceptance in government and corporate sectors as third party vendors begin to improve on product quality and after sales break-fix support services to contractual clients.

On an overall perspective, IDC believes the ink cartridge market will be dominated by OEMs with declining competition from third party vendors while the third party vendors will find opportunities in the laser toner market.

For inquiries about this tracker research, please contact your IDC account manager or Shari Jane Jansen at sjansen@idc.com. For media inquiries, please contact Tessa Rago at trago@idc.com or Alvin Afuang at aafuang@idc.com.

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¹ IDC: Third party vendors are Non-OEM vendors, selling only supplies but not printers

² IDC: Original vendors are OEM vendors, selling printers as well as supplies