HP/COMPAQ: Compaq's Lexmark relationship in doubt

HP/COMPAQ: Compaq's Lexmark relationship in doubt

The HP/Compaq merger is likely to spell the end of Lexmark's relationship with the Texan vendor in the consumer space.

Lexmark provides inkjet printers for sale under the Compaq brand, but in light of the direct competition with HP's own inkjet business - a market that the company has dominated since its inception - it is problematic whether the relationship will continue.

Lexmark executives have refused to comment on whether the relationship with Compaq will be severed. However, John Boughton, Lexmark's vice president of finance and business development for the Asia-Pacific region, has stressed that sales of Compaq-branded inkjets account for only a small percentage of the vendor's overall business.

"The vast majority of our inkjet sales come under the Lexmark brand," he told ARN. "Sales under the Compaq brand account for less than 3 per cent of our revenue so it is not a significant aspect of our business."

Lexmark has had a relationship with Compaq in inkjet printers since 1998, as well as a number of other global companies, Lexmark said in a statement.

"In addition, the installed base of Compaq inkjet printers supplied by Lexmark will continue to generate demand for profitable Lexmark supplies in future periods."

While Boughton would not be drawn to comment on the impact the acquisition will have on HP's printer sales, he remains optimistic that Lexmark will be able to capitalise on the situation over the coming months.

"I certainly would like to think we can take advantage of it," he said. "We are not adverse to competition and we have achieved significant growth in the local market."

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