It"s no secret that printer manufacturers such as HP, Canon, Lexmark, and the rest of the crowd sell their printers for little to no profit in order to attract initial buyers. The real profit comes from the sales of ink cartridges that can, sometimes, be sold for 50% of the cost of the entire printer itself.
In recent years, however, "ink piracy" has become a thorn in the side of printer manufacturers as they lose almost $3 billion a year to illegal ink cartridges (refilled cartridges sold as new, reverse engineered cartridges, and printers modified to accept any cartridge). In an effort to fight back, Cryptography Research Inc, (CRI) has stepped in with a chip that would require the user to use only manufacturer sanctioned ink cartridges in their printers.
Of course, any kind of digital protection is going to be attacked by the thousands of highly skilled hackers out there. To help combat this issue, the chip, called CryptoFirewall, will generate an individual code for each and every ink cartridge meaning would be hackers would have to crack each new cartridge manufactured. CRI admits that it"s system won"t completely eradicate ink piracy, but that the "system is designed to recover from failure".
News source: CNET