The truth about K-cups

I don't own a Keurig single-serving coffee maker, or one of its competitors (assuming the Keurig juggernaut hasn't driven them out of business). I make my morning fix in a French press, using coffee that costs me about $14 for a giant container from Costco.  I've tried Keurig coffee a couple of times at places like the service department at my car dealership, and found it weak and muddy.  Still, I know I'm in a minority here -- people seem to like the convenience over all else, and damn the cost.

A couple of months ago, the guy who invented the K-cup and sold the patents to Keurig Green Mountain for peanuts was lamenting what he'd done: not so much the fact that he'd left a fortune on the table, as that he'd inflicted on the world a machine that generated endless mountains of used K-cups to moulder for decades in town landfills. He claimed that he was astounded that the machines had caught on for home use, given the extraordinarily high cost per cup; his idea had been that they'd find a home in places like my dealer's service department.

Today we see this fascinating story, about Keurig climbing down from its decision of a few months ago, to make its second-generation brewing machines incompatible with reusable coffee holders. As a non-user of the product, I had no idea about this, but it turns out that you used to be able to buy a reusable gewgaw ("'My K-cup") that you could fill with any coffee of your choice, and reuse over and over again. No more mountains of one-use K-cups in the landfill, and no more paying the equivalent of $50 per pound for coffee in pre-filled K-cups. There was a consumer uproar when the new machines were set up to be incompatible with My K-cup, and after seeing sales of its machines tank, Keurig has had to reverse course.

Keurig has claimed for some time that it is hoping to introduce recyclable or compostable K-cups by (wait for it) 2020. It had better speed that timetable up, because smart consumers have now been given a clear insight into the company's business model. It was well-known that the machine itself was largely sold as a loss leader, with the profit coming mainly from the subsequent sale of over-priced pods. It's now clear that the company's profitability, and its huge market capitalization, entirely rely on this.  Customers can in fact endlessly refill their own pods with their own coffee; if enough of them now choose to do so, Keurig will be in trouble.  It could, of course, try to increase the price of the machines themselves, but that too is likely to lead to a consumer revolt.

It's a mess entirely of the company's own making, and they seem pretty contrite about it. It remains to be seen whether their customers, or their shareholders, will be forgiving. Me, I'm sticking with the French press -- though, come to think of it, I have to take my car in for service tomorrow, so....