Tren Griffin @trengriffin I work for Microsoft. Previously I was a partner at Eagle River, a private equity firm established by Craig McCaw. I am on the board of directors of Kymeta. Oct. 06, 2019 1 min read

25iQuiz: Do you agree that's what changed?

"HP’s business model was to sell printers at a discount and make its money on ink cartridges—classic razor-and-blades. 'That model made sense when the goal was to penetrate more consumer homes and more offices'." https://news.google.com/articles/CAIiEFUFaahYfiIzgfRYbDSMTdMqFQgEKg0IACoGCAowrqkBMKBFMMGBAg?hl=en-US&gl=US&ceid=US%3Aen 

Did a change in HP's goal require a new business model or did HP's ability to sell enough of a complementary product change?

From 2006: "The printer itself accounts for only 1/3 of the profit pool over its life, whereas cartridges account for 2/3s."  https://www.bcg.com/documents/file14706.pdf 

"Absent customer lock-in, the marketer will be unable to make up for the price subsidy on the initial razor through higher margins on the blades."

"Rather than compete on price, the printer maker [Epson] is dropping the cartridge issue entirely’’  http://iranarze.ir/wp-content/uploads/2016/10/E2554.pdf 

"Kevin Rippey, an Evercore ISI analyst, calls Spotify a “pure play on a loss-leader category.'"  https://www.barrons.com/articles/two-analysts-have-ditched-sell-ratings-on-spotify-why-to-remain-skeptical-on-the-stock-51570236239?refsec=technology  What can Spotify cross-sell that has defendable higher margins and a huge TAM?

"Goldman has lost $1.3 billion on its consumer bank"  https://www.google.com/amp/s/www.wsj.com/amp/articles/goldman-sachs-tries-banking-for-the-masses-its-been-a-struggle-11569643252  What can Goldman cross-sell that has defendable higher margins and a huge TAM?

"HPQ fiscal third quarter results posted Thursday showed printing supply revenue falling 7% from a year earlier to about $3.2B."

"We need to optimize our business model, maximize the installed base of 150 million printers."

 https://www.marketwatch.com/story/with-yet-another-restructuring-hp-wakes-up-to-the-realities-of-its-struggling-cash-cow-2019-10-03 


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