June 27, 2007 9:45 AM PDT

Can cryptography prevent printer-ink piracy?

In the computer printer business, everyone knows the big money comes from the sale of ink cartridges.

Most of these cartridges are made by printer manufacturers and sell for a substantial premium. Some come from unauthorized sources, sell for substantially less and attract the attention of antipiracy lawyers.

Cryptography Research Inc. (CRI), a San Francisco company, is developing chip technology aimed at helping printer manufacturers protect this primary source of profit. The company's chips use cryptography designed to make it harder for printers to use off-brand and counterfeit cartridges.

"We're not saying we can end piracy, but our system is designed to recover from failure," said Kit Rodgers, CRI's vice president of business development.

Not all ink-cartridge remanufacturing is illegal--much of it is, in fact, legitimate--but pirated ink-cartridge technology cuts substantially into original manufacturers' profits.

There are three main ways the $60 billion-a-year worldwide printing industry loses money:

• Used cartridges get refilled and sold as "new"-- instead of as remanufactured.

• Cartridges get illegally replicated through reverse engineering.

• Printers get hacked or physically altered to use any type of ink.

Although solid figures on counterfeiting are impossible to determine, it's estimated to cost the industry at least $3 billion a year, according to the Image Supplies Coalition, a lobbying group formed to fight piracy and cloning in the ink and toner industry.

You can see 95 percent of the (chip's) grid and you still don't know how it works.
--Kit Rodgers,
VP of business development,
CRI

Cryptography is a method of encrypting data so that only a specific, private key can unlock, or decrypt, the information. It's used in everything from credit cards to digital media. CRI plans to create a secure chip that will allow only certain ink cartridges to communicate with certain printers.

Although this concept isn't new, CRI said its chip will be designed for use in standard fabrication processes, eliminating the need for a special--and more expensive--manufacturing process. CRI also said that the chip will be designed that so large portions of it will have no decipherable structure, a feature that would thwart someone attempting to reverse-engineer the chip by examining it under a microscope to determine how it works.

"You can see 95 percent of the (chip's) grid and you still don't know how it works," Rodgers said. There also are other, secret elements CRI won't reveal for security and competitive reasons.

Skillful hackers can eventually crack almost any code thrown at them and then exploit it for commercial purposes. Once antipiracy encryption is hacked on a product such as high-definition DVDs, for example, it's cracked forever and the discs can be copied and played using the hack. CRI takes a different tack with its protection scheme: its chip generates a separate, random code for each ink cartridge, thus requiring a would-be hacker to break every successive cartridge's code to make use of the cartridge.

ALT TEXT
Credit: CRI
This is a platform CRI uses for testing
the security and authenticity of chips.

"We want to make sure you can't repeat the same attack," said Benjamin Jun, CRI's vice president of technology. "If (hackers) have to rebreak it over and over, it's not as good a business model."

The chip, called CryptoFirewall, is not in use in this industry yet, but it's been widely deployed in the pay-TV sector, where 25 million set-top boxes have a similar technology from CRI embedded, the company said. CRI will also soon debut a similar copy-protection feature for Blu-ray video discs. The printer technology will be available in early 2008, according to CRI.

Counterfeiting and piracy are all but impossible to eradicate, but CRI hopes to at least minimize the financial damage they cause. Today, there are 123 million desktop inkjet printers and 25.6 million laserjet printers in use in the U.S., according to InfoTrends.

In terms of making and selling hardware, printers themselves are one of the least profitable sectors. Often the manufacturers are willing to sell their printers at a loss with the goal of making money on sales of ink. Hewlett-Packard, the biggest PC maker in the world, actually makes the most profit from its printer business: 46 percent of its total earnings in the most recent fiscal quarter were generated by its Imaging and Printing Group. And ink is a key.

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100 comments

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Hey! why not lower the price of ink, DUH!
Has HP ever thought of lowering the price of their ink cartidges? I mean duh! Then they would always get most people buying their crap. I mean 30 bucks for a 1/8 cup of ink? I could fill my gas tank on that money.
Posted by inlasvegas1 (5 comments )
Reply Link Flag
Absolutely- you reap what you sow
I agree. The printer manufacturers have created the problem themselves through the absolutely ridiculous prices they charge for their ink. In doing so, they have created a strong demand for an alternate source, hence the black marketeers- so screw 'em.
Posted by hounddoglgs (74 comments )
Link Flag
Piracy?
So let me get this straight - now, we're pirates if we want to put a cheaper ink cartridge in our printer? ***?

Here's a better one - Ford calls us pirates if we drive a Honda, Sunoco calls us pirates if we use QT gas... this has got to stop!
Posted by JamesEPriceJr (1 comment )
Reply Link Flag
Great... Now I am a Pirate too.
I just replaced my General Motors factory air filter on my truck with a STP one... guess I need to raise my pirate flag now.
Posted by arluthier (112 comments )
Link Flag
I won't buy one
Ink is a rip off and everybody knows it, that's why there is such a big competitive market.

My sense of choice is greater than my sense of loyalty to Canon or Brother or HP, if they sell out by using these chips, they can kiss my greenbacks bye bye.
Posted by wjcunning (11 comments )
Reply Link Flag
I won't buy one either!
I don't buy DRM'd music, and I won't buy a printer if there's not a 2nd source for ink.
Posted by DougDbug (62 comments )
Link Flag
I agree!
This is total crap! I can't wait until these morons file chapter 11.

Now we need an open source printer. Anyone know of one? Anyone wanting to help create one?
ethana2@gmail.com
Posted by ethana2 (348 comments )
Link Flag
wow
But when Microsoft tries to incorporate native software into windows(ie: IE heh), people cry and b*tch to no end. Why is no one taking action against these companies? Wouldn't this be considered anti-competetive behavior?
Posted by eheia (10 comments )
Reply Link Flag
>:(
Pirates? Yarrgh, Matey. Get real. One of the few protections
that consumers get in a free trade system is competition. If you
charge unreasonable prices for your goods, then someone else
will provide those goods at a lower price. We once again have to
ask ourselves why it is that "Pirates" are able to distribute
someone else's product more efficiently and cost effectively?
And since when are competitors "Pirates"? And how much
protection are we willing to give print cartridges as intellectual
property? My word, these highwaymen of the seas are making it
so printers can work with any cartridge! Man the cannons of
copyright law! And is refilling cartridges in the current climate
of environmental concerns really such a terrible thing? This
article doesn't seem to be concerned in the least for the
consumer, so I have to wonder if this is a commissioned piece?
Posted by Bobthewondercow (2 comments )
Reply Link Flag
Maybe someday someone will get it right
I understand the economics of it all. . .

Sell printers at give away prices then charge through the nose
for ink. You only buy a printer once, but you'll keep buying ink
for years, or so the theory goes. If someone is making cheap
replacement ink cartridges that clearly must stop. You wind up
giving away printers and not making your ink money back.

They have made ink so expensive that buying a few cartridges
nearly cover the cost of a new printer (which comes with ink).

Photo Printer about $200
5-6 ink tanks $14 each - $70-$84

Printer cost without ink - $116-$130
The printer's depreciation and the cost of replacing the ink
intersects quickly. After putting a few cartridges through you
are basically better off buying a new printer. Oh the disposable
society we live in!
Posted by sbwinn (216 comments )
Reply Link Flag
Huh? Pirate carts? You're kidding....
Since they sell the printers so cheap with the carts, I usually buy the printer w/carts and throw both away when the carts go dry. I buy the printer when it's on sale or close out.

I get new full carts and a new printer for less or about the same as new carts.

Seemed like a no-brainer to me.
Posted by Mikejoem (3 comments )
Reply Link Flag
Ink Pirates?
Pleasseee. We do a lot of printing at our shop and we settled this argument a long time ago. We printed thousands of color intensive photos using the original cartridges and a variety of "off" brand units. Unless you blew the photo up to poster size, even the person who took the shot couldn't tell the difference. We have saved thousands of dollars using third party ink.

If the printer manufacturers insert something into their product just to cripple competition, then they can expect some enterprising off shore company to start selling printers that will use any cartridge. After HP etc., sees their products gathering dust for awhile, they will stop this damn foolishness once and for all.
Posted by a155mm (7 comments )
Reply Link Flag
Not all bad on printer company's part
There are two misunderstandings taking place here.
1. Printer companies have to make money on the ink because they are losing alot of money on every single printer they sell. As a consumer, you have two choices, cheap printers with expensive ink or expensive printers with cheap ink. If everyone here is willing to pay about 3 times as much for their inkjet printers, then the printer companies won't have to charge so much for official ink and you can buy cheap low-quality ink from competitors.
2. The "starter" cartridges you think you are saving money on by buying a new printer instead of new cartridges are just that...starters. They usually contain about 25-30 percent of what a normal ink cartridge does. Even in the current business model, it is cheaper to buy the ink cartridges than replace the printer because you are getting alot less ink in a new printer. A printer plus one set of new cartridges is alot cheaper than the 4 or 5 new printers you would have to buy to get the same amount of ink.
Posted by wilw410 (2 comments )
Reply Link Flag
You've got it backwards
It is the COMPANIES that decided this business model of cheap printers, expensive ink. Now they are trying to figure out how to punish customers from saving a buck.

If car companies sold cheap cars but also expensive proprietary gasoline, would we be "pirates" for trying to put less expensive fuel into the cars?

What about ballpoint pens, razor blades, etc.? Calling people "pirates" for doing this is totally ridiculous.

It's a fundamental issue of freedom to do with product what we please once we own them. For the last few decades, companies are constantly trying to control how we use what we buy, it's extremely annoying.
Posted by Clouseau2 (329 comments )
Link Flag
I respectfully disagree
1. Upon what are you predicating printer manufacturers are losing
money on printers? Which printer models? How much? Says who?
2. I should be under no obligation to buy my peripherals from the
manufacturer. Is Sony going to demand I stop using my TDK DVD-
R discs in the DVD burner I bought from them? Will they add
changes to the firmware to ensure I do?
If you can't sell printers AND cartridges at a reasonable price, sell
one or the other at a fair price.
Posted by Bobthewondercow (2 comments )
Link Flag
Upside-Down World
I know this is old-fashioned of me, but what about pricing items in line with what they cost?

Cell phone? FREE!!! (but we'll bend you over a barrel for $70 every month)

Printer? $19.99 (but if you want to print anything, you'll have to shell out $50 for a ink cartridge every other month)

You get the expensive thing for free, and they charge an arm and a leg for the item that actually costs them very little.

Brilliant! If they priced things realistically, they could only fleece you once; by instituting an upside-down world, they get to fleece you on a regular basis month after month, year after year.
Posted by heinriph (9 comments )
Link Flag
A money-making opportunity?
"1. Printer companies have to make money on the ink because
they are losing alot of money on every single printer they sell. As
a consumer, you have two choices, cheap printers with
expensive ink or expensive printers with cheap ink."

Why not use a standard business model and sell printers so that
they make a reasonable profit on them and let consumers buy
consumables wherever they want? If the printer manufacturers
produce superior ink at a competitive price, people will still buy
it, making the ink business profitable as well.

I have paid, directly, for one ink-jet printer in the last 20 years.
Five more have come as "free" bonuses with computer
purchases. If I use OEM ink cartridges, I pay the full cost of a
new printer with every second set. If I use third-party ink
cartridges, I pay the full cost of a new printer with every tenth
set. Over the lifetime of a printer I replace the cartridges maybe
ten times, the end of a lifetime being determined by my
purchase of a new computer.

I'd have to be crazy to use OEM ink! If this anti-competitive
concept goes into practice, I will buy up every old-but-
functioning printer I can find. They cost almost nothing since
most people got them for free. There will be a huge market for
them when people realize that new printers will cost six times
their purchase price over a lifetime of ink cartridges.
Posted by Marc Myers (51 comments )
Link Flag
How do you know?
On what basis do you base the claim of low fill rates for "starter" cartriges? This doesn't make a lot of sense for companies to do this. The ink itself is not that expensive (but the whole package is) and initial customer reactions to quickly having to buy more would be negative. My new printers always show full inks carts? Explain this?
Posted by steveos001 (1 comment )
Link Flag
You don't know what you are talking about
I bought my first inkjet in '98 and paid $500 for it. But just like, everything else, the technology has gotten a lot cheaper in the last decade. Hard drives and RAM can be bought dirt cheap- are all those manufacturers losing money too just because their product is inexpensive? Sure they give away printers as promos here and there, but I'd be willing to bet it only costs them $50 to build that $100 printer you find at any retailer.

The bottom line is this- If you have HP Printer, you can't stick a Canon cartidge in it- you have/had to buy it from HP. That's why they've been able to charge such ridiculous prices for ink all these years and that's why they don't want to see any competition.
Posted by hounddoglgs (74 comments )
Link Flag
Guess You are in the Pocket of the Printer Mfgs!
This article sure is biased towards the big companies that are ripping us off! What about the recent news that most ink cartridges will never give up all their ink so thealready inflated price we pay for ink gets inflated more.

Let the printer companies charge a fair price for their printers AND their ink.
Posted by walterwood (41 comments )
Reply Link Flag
The article should say...
Instead of "There are three main ways the $60 billion-a-year worldwide printing industry loses money:"

The correct way to state that is "There are three main ways to prevent the $60 billion-a-year worldwide printing industry from raping consumers:"
Posted by sismoc (119 comments )
Reply Link Flag
Communism for the bigboys, business as usual
Patenting ink is complete insanity. Calling it piracy is a howler. Ink
is ink. It's just communism for the bigboys, capitalism for the rest
of us. This kind of arrogance makes me want to line up on Calle
Arce here in San Salvador (AKA Pirate Alley) so I can buy as much
pirate ware as possible. In fact, with that kind of patronizing crap
I'd actually go out of my way and pay more for pirated goods than
for the real thing.
Posted by Rick Mc Callister (22 comments )
Reply Link Flag
Ink Cartridges cost TOO MUCH
that's one of the many reasons there is a ready market for third-party ink carts. If the Printer Mfrs got thsi act together and priced things fairly for the CONSUMER, they would retain more of the market. But GREED is ingrained into American business these days, it seems...
Posted by dagnome (4 comments )
Reply Link Flag
You get what you pay for
I can not begin to explain the amount of engineering that goes into quality Inks and Media. This is not like going to the cheapest gas station in town to get the most economy. 3rd party inks are usually destructive to the printer, not to mention the poor quality in every respect. Do you think a 3rd party ink manufacturer cares one bit about what their product does to your printer? 3rd party Ink sellers are the greedy ones, they got into the business just to make the quick money, and not have any responsibility to the customer. If the cheapest gas station in town sold gas that would run but ruin your car after a few tanks would you still buy it? Who is the greedy one?
Posted by chash360 (394 comments )
Link Flag
Some people...
"But GREED is ingrained into American business these days, it seems..."

That is a stupid comment.
Business is business, regardless of nationality.
More gratuitous anti-U.S. b.s....
Posted by powerclam (70 comments )
Link Flag
how is this piracy?
How is buying ink in the market place now considered piracy? It's quite sad cnet has bought into this new speak. The headline should read, "Printer companies use TV tech to fleece consumers" This sort of racketeering should stopped by the government.
Posted by noldrin (17 comments )
Reply Link Flag
Brilliant! Let's do this with everything.
First of all, thank you to the printer industry for doing everything they can to protect me the horrific dangers of third-party ink cartridges.

Hopefully other industries will follow suit:

- car manufacturers should implement sensors in carburators so that the engine will only run if it is using a manufacturer-endorsed petrol (which would have specific chemical markers added)

- CD-writer manufacturers should implement sensors to reject all CD-R media except those which have been specifically endorsed by the manufacturer

Implementing such cross-marketing deals might make your life as a consumer more expensive, but it's the only way to responsibly protect you from inferior substitutes. By ensuring that your Chevy won't run on anything by Exxon-Mobil gas, they can protect you from any possible ill effects of e.g. Texaco gasoline. Who knows what those crazy people at Shell put in their gasoline? Don't take that risk - better yet, we'll prevent you from taking that risk.

And if you find your manufacturer-endorsed CD blanks give you errors, or your HP-branded printer cartridge stops working after 10 pages.... well, tough luck. Don't be a cry baby. You probably did something wrong. Go out and buy a new one.

In the name of profit, and growth, and the shareholder,

AMEN.
Posted by heinriph (9 comments )
Reply Link Flag
Ill-advised
To sugguest that petrol chemistry has any similarity with Ink chemistry is not very intelligent, all petrol has to do is explode, and all your engine has to do is not explode. When your talking about ink and printers its not the same thing. All of the oil companys want your business and will claim their gas is better for your car, but you as the consumer know that for them to sell it as gasoline it must contain a specific chemistry to be sold as such. There is no such standards in ink, the chemistry is far more complex and the performance requirements far greater than that of petrol products as fuel. If you find a 3rd party ink refiller, supplier, etc. that will guarentee that their ink will not damage your printer, and is willing to replace your printer if it is damaged, then buy it! If there is a real law that should be instigated here, it would be for a requirement for these 3rd party sellers be held accountable for their products, and the damage to your printer as well as the environmental hazards they pose. But then you would see the 3rd party inks go up in costs to that of the big OEM's (because they are accountable to their customers for what they sell). You want your cheap inks, but they come with a hidden cost you blindly accept (no support, no responsibility, no proper waste handling, no hazardous chemical safety, and potential destruction of your printer, all along with poor print quality and poor reliablity). I agree the world has run amuck with everyone trying to claim some sort of IP, or patent, and wanting royalties to even speak their name, etc. but you can't expect that you should be able to get a glass of orange juice for dime just because apples are on sale for a penny.
Posted by chash360 (394 comments )
Link Flag
Do not laugh too quickly...
At first, this seems funny - until you realize that this is the business model Apple has been using for decades...
Posted by MikeeeC (43 comments )
Link Flag
Printer makers are thieves!
That's one reason I avoid printing when ever possible. I print to PDF
and email it. That saves me electricity, ink and paper for the
printer, and I don't have to use a low quality, insecure fax machine
or expensive snail mail. What's more, I've got a permanent copy of
whatever I sent!
Posted by Macsaresafer (802 comments )
Reply Link Flag
It's not piracy to use a different ink with your printer!
Good grief. So if the Crayola company makes crayons and I buy paper from a different company is that piracy too?

Ink is a physical liquid. you can't pirate ink. No one is being _robbed_ if you refill an ink cartridge or use Brand X.

This is insane, and the article probably shouldn't have been printed.
Posted by bob donut (90 comments )
Reply Link Flag
Correction
You can prirate ink, if you stole the patented formulae reproduced and sold it, that would be piracy. But this is not Piracy they are talking about, CNET does this kind of headline sensationalism all the time.....You are free to put whatever you want in your printer (even food coloring or Nitro-Glyrcerin) just don't expect your Printer OEM to honor a warrentee after that.

You speak of Ink as if it were a single element on the periodic table, do you really think its that simple?
Posted by chash360 (394 comments )
Link Flag
Bow weep granow weep ninny baum!!!
I'm assuming it's also piracy to use aftermarket parts on your car, and add aftermarket stuff to your computer, or mix and match clothes at walmart, or mix celery and peanut butter, or chocolate and peanut butter... man when will these companies stop puking snot up our *****?! As far as I know, it might void the warranty on your printer to use aftermarket printer cartridges, but that's about the extent of it.
Posted by mattumanu (599 comments )
Reply Link Flag
Not a warranty issue
Using aftermarket ink will not void your printer warranty. The Magnusson-Moss Act, passed in 1975, requires, among other things, that if a manufacturer is going to require the use of a specific brand of replacement part as terms of the warranty, then the manufacturer must provide those parts free of charge?I would like to see the OEM?s take on that one?
Posted by MikeeeC (43 comments )
Link Flag
What manufacturers are going to use this?
Please keep us informed so we can vote with our money and not buy their products.
Posted by george.titus (1 comment )
Reply Link Flag
How 2-Faced
Many Ink-jet mfg's have been litigated against for the very same concept, trying to prevent the use of destructive 3rd party inks. Now there is a company purporting to sell this ability? Don't expect any takers anytime soon. I believe the courts have already supported the end users right to choose, however ill-advised that is. But fair warning, 3rd party Ink sellers typically are not industrial chemists, they sell the cheapest inks (that often destroy printers with continued used), for the greatest profit. They care nothing about the end user, and have no comittment to them. Inks are patented, so this really isn't Ink Priracy anyway, its more like the generic overseas drugs that could kill you, because they used cheap diethylene glycol (antifreeze) instead of pharmecutical grade poly-ethylene-glycol. Stick with a reputable manufacturer and the inks designed to work with the system, and you will be at peace with your printer, and know you have the mfg on your side there to help should your printer have an issue. Or you can dump uncontrolled colored solvents and acids in your printer, and wallow in self pity why it no longer works. Don't even get me started on the enviromental issues with 3rd party inks, at least the big OEM's have proper recycling and disposal services, your local refill shop probably dumps their waste down the sink! With ink-jet cost per page (with OEM inks) rivaling that of copier pages of a few years ago, I can not think of any reason to think the OEM Ink is too expensive.
Posted by chash360 (394 comments )
Reply Link Flag
A non-problem
Which printer manufacturer do you work for?

I've used cheap ink for 20 years and had only one problem with
it. I have no way of knowing if it was the ink at fault or if the
printer had simply reached its "planned obsolescence". I've
spent approximately $400 on ink. If I'd used OEM ink I would
have spent $2,000. $1,600 dollars would pay for a lot of new
printers.
Posted by Marc Myers (51 comments )
Link Flag
How 2-Faced
Many Ink-jet mfg's have been litigated against for the very same concept, trying to prevent the use of destructive 3rd party inks. Now there is a company purporting to sell this ability? Don't expect any takers anytime soon. I believe the courts have already supported the end users right to choose, however ill-advised that is. But fair warning, 3rd party Ink sellers typically are not industrial chemists, they sell the cheapest inks (that often destroy printers with continued used), for the greatest profit. They care nothing about the end user, and have no comittment to them. Inks are patented, so this really isn't Ink Priracy anyway, its more like the generic overseas drugs that could kill you, because they used cheap diethylene glycol (antifreeze) instead of pharmecutical grade poly-ethylene-glycol. Stick with a reputable manufacturer and the inks designed to work with the system, and you will be at peace with your printer, and know you have the mfg on your side there to help should your printer have an issue. Or you can dump uncontrolled colored solvents and acids in your printer, and wallow in self pity why it no longer works. Don't even get me started on the enviromental issues with 3rd party inks, at least the big OEM's have proper recycling and disposal services, your local refill shop probably dumps their waste down the sink! With ink-jet cost per page (with OEM inks) rivaling that of copier pages of a few years ago, I can not think of any reason to think the OEM Ink is too expensive.
Posted by chash360 (394 comments )
Reply Link Flag
The only pirates are the printer manufacturers.
They write software that intentionally reports cartridges empty when in fact they have several more pages of ink left in them. They use patent and the DMCA to restrict competition and drive prices through the roof for just a few milli-liters of ink.
The only pirates are the profiteers running the companies that make the printers
Posted by unknown unknown (1951 comments )
Reply Link Flag
This is an infomercial. c|net should label it as "advertisement"!
Somebody might mistake the this infomercial for real article. c|net really writes what they are paid for. "Ink Pirates"... jeez.
Posted by Santa Clauz (7 comments )
Reply Link Flag
Printer Ink problems
The community printer will ultimately be the answer to all of this nonsense. Why they spend so much money on other things is beyond me. I can go to the Library of any city government, university or college and get it by the page on the few occasions that I don't just email the data or save it into a files on my jump drive. It usually ends up as trouble when these kinds of business ventures start running out of money, the handwriting on the wall, and all that sort of thing...
Posted by jack1260 (19 comments )
Reply Link Flag
Bad reporting...
This is truly a case of really poor reporting. Although it makes a short mention of legit refilling, the real target of "smart" carts has ALWAYS been the legit refil/remanufacturing market. The reporter should have spoken to a remanufacturing vendor for its view on adding crypto to carts. Bah. A first year reporting student would not have missed this angle of the story which is pretty much a BJ for the crypto vendor.
Posted by oldmanangry (79 comments )
Reply Link Flag
don't drive angry oldmanangry...
Actually, I agree with you, I just wanted you to look at the fact that I do ;)
Posted by mattumanu (599 comments )
Link Flag
 

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