Keurig Will Raise K-Cup Prices by 9% as New DRM Machines Limit Competition
Coffee drinkers take note, the price of your morning brew is about to go up. Keurig Green Mountain, makers of the popular single-serve Keurig machines, announced that it will raise the cost of its K-cup packets by up to 9% starting November 3. The price hike comes roughly five months after the company revealed its Keurig 2.0 machines, which pack built-in DRM to limit competition.
Keurig attributes the price hike to recent droughts and disappointing coffee harvests in South America, which have raised the price of Arabica beans by as much as 50%. However, the price increase is especially hurtful to consumers because Keurig's new machines will only work with Keurig-approved K-cups. Older machines worked with third-party K-cups, which allowed for a more competitive K-cup market and cheaper prices. With these new DRM-style machines, consumers have no choice but to buy Keurig-approved K-cups, since the new machines will not recognize unlicensed pods.
Despite the crackdown, Keurig hopes it can retain customers by arguing that its new locked-down systems will ensure a high quality brew with each cup. The new 2.0 machines, which are rumored to start at $189, will also pack new features such as the ability to brew a 4-cup carafe and a preferences button, so users can program brewing preferences into their machines. Whether this will be enough to please its customers has yet to be seen, but one thing is certain, even as Keurig's patents on its pods expire, the company is making sure it keeps tight control of its profits. And that's not surprising, as U.S. sales of pods tripled to $3.1 billion between 2011 and 2013, according to market research firm Mintel Group.
Unfortunately, Keurig isn't the only coffee giant to raise its prices this year. Earlier this summer, Starbucks hiked the price of its coffee by up to 8%. Folgers and Dunkin Donuts were equally affected by rising coffee costs and also passed the burden to consumers with similar price hikes of 9% on their brews.
With price hikes and lockdown policies taking effect, how do you plan on satisfying your coffee urge? Let us know in the comments section below.
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Nestle is very picky about Nespresso, they only sell it online and at their own Boutique stores to guarantee quality and freshness.
Except for Bed Bath & Beyond, I've never seen any Vue coffee pods in stores. Everyone carries K-cup pods. Is Keurig Vue such an abysmal failure that they're going back to K-cup style but adding DRM just to spite their customers for not embracing the Vue pods?
I wonder if there will still be third-party Keurig-style machines that will not have DRM? Since the Keurig K-cups are no longer protected with patent protection, what about the basic/original Keurig system? These third party Keurig-style machines may not be able to call themselves Keurig machines, since that is a trademark. Maybe they can still call themselves "K-cup compatible" or "Keurig K-cup compatible" like software can say it is "Windows compatible" although "Windows" is a trademark.
Considering the number of choices in K-cups on the shelves at Publix, and the Keurig machines I see in offices, I think the current Keurig K-cup market is "too big to fail". As long as third parties can make original K-cup compatible machines, the classic K-cup will survive.
So it will be like the inkjet printer sellers, black/gray market k-cups?
But we do have a choice, and that is not to buy into the DRM'd scam. There are other "systems" that compete with the K-cup. I predict that sales of the K2 will be very poor.