Xerox said Tuesday that it has teamed with Sharp and Fuji Xerox in a US$2 billion alliance that could lead to faster, more affordable ink-jet printers for small office and home office (SoHo) users.

The companies will each offer a full line of low-cost ink-jet printers that will be sold worldwide through more than 12,000 retail stores, Web sites and other outlets, officials said. Xerox's first new printers will be available in North America in the next few months, the company's president and chief executive officer Rich Thoman said.

The printers from the three firms will include new technologies that make them "at least 50 per cent faster" than comparable ink-jet systems from Hewlett-Packard and other Xerox rivals, Thoman claimed.

"Ink-jet has always been a trade-off for the user. You can have colour speed, or colour quality - never both," said Thoman. "But that, ladies and gentlemen, is about to change."

Another option Ink-jet printers provide an affordable alternative to laser printers, which cost more and tend to offer better quality results. Ink-jet technologies are improving, however, and sales have started to surge alongside growing PC use and an increase in the number of people who work at home, Xerox officials said.

The market for ink-jet printers could be worth more than $50 billion by 2002, according to Xerox estimates. Hewlett-Packard (HP) is the recognized leader in the market, but Xerox officials said they hope to steal some of HP's business by banding together with the partners announced today.

The three companies will pump a total of $2 billion into the alliance over the next five years, Thoman said. The money will be used to cover development, manufacturing, marketing and other costs, he added.

To boost performance, the new printers will include an operating mode called eXpress Mode, which the companies claim will print much faster than the normal mode on competing ink-jet machines, while maintaining "comparable" quality. eXpress mode uses a "bi-directional printing" design developed by Xerox that allows a line of type to be put down in a single sweep across the page. Most printers put down half of the ink needed for a single line of type in each of two passes, Xerox said.

Another feature called InkLogic uses four ink tanks in a single colour printer, while most ink-jet printers use one. InkLogic allows users to replace only the ink colour that is empty, which Xerox said will help cut ink costs by 20 per cent.

On and on The printers will also feature a long-life print-head technology that can last up to 10,000 pages without replacement. Most competitive models require users to replace print heads about every 500 pages, according to Xerox.

Xerox will begin launching personal ink-jet printers, copiers and multi-function machines over the next few months in North America, Europe and developing markets. Sharp will offer its brand of ink-jet products in those markets, as well as in Japan and the rest of Asia-Pacific. Fuji Xerox-branded products will be sold in Japan and the rest of Asia-Pacific.

Expanded production The companies have also opened new manufacturing facilities to serve the growing market. Xerox said it has opened state-of-the-art ink-jet facilities in Dundalk, Ireland; Canandaigua, New York; and Manaus, Brazil. Sharp has built a dedicated ink-jet product manufacturing and assembly centre in Manila, Philippines, the companies said.

The companies called their alliance the SOHO Printing Alliance, and said it will draw on Xerox's strong brand and ink-jet patents, Sharp's expertise in producing low-cost products for mass markets, and Fuji Xerox's technological know-how. The Alliance is Xerox's second major move to capture growth in printer markets. In September of last year, Xerox announced plans to acquire Tektronix's printing business for $925 million

Fuji Xerox is a 50-50 joint venture between Fuji Photo Film and Xerox that develops, manufactures and markets office equipment, software and solutions in Japan and the Pacific Rim.