Lexmark International said it is already making plans to exit the inkjet printer market this year. The big winners could be Fuji Xerox, Samsung, Brother, HP and Epson.
The US Company said they are moving to close down their manufacturing facility in Cebu, Philippines, and that they will stop all development of inkjet products worldwide. The restructuring will result in the loss of 1,700 jobs globally, with 1,100 coming in the manufacturing sector, the company said.
Lexmark will continue to provide service, support and aftermarket supplies for its inkjet installed base.
The company expects to generate a savings of $85 million in 2013. Pretax cost of the closing should be about $160 million.
Lexmark CEO Paul Rooke called the decision "difficult," adding the company intends to focus on higher value imaging and software solutions.
Lexmark's printer market share is below 1 percent, according to an IDC report earlier this year.
"It's a declining market with far too many players," Gartner analyst Federico De Silva told Reuters. He estimates the number of monthly pages printed by the average consumer has fallen by more than 40 per cent in recent years.
The cutbacks will affect about 13 per cent of Lexmark's workforce, based on the 13,300 employees on the company payroll at the start of this year.
Lexmark hopes to recoup some of its money by selling its roughly 1,000 patents on inkjet technology and other items from its discarded business.