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NEW YORK Starbucks Corp. is turning up the heat on the single-serve coffee market, and someone might get burned.
The Seattle-based company says it will start selling its new single-serve brewer online this week for $199. The machine will be rolled out in its ubiquitous cafes next month.
The arrival of the Verismo comes amid intensifying competition for single-serve brewers and the coffee pods they use.
The sector is currently dominated by Green Mountain Coffee Roasters Inc., which pioneered the market after its acquisition of the Keurig brand machine in 2006. But this month, the company’s patent on its K-cup technology expired, which spawned copycat versions of coffee pods for Keurig machines.
Starbucks’ decision to sell its own brewer comes less than a year after it struck a deal with Green Mountain to make coffee pods for Keurig machines. Now Starbucks is looking for a bigger piece of the pie. Starbucks will still sell its pods for Keurig machines in cafes.
The Verismo uses a high-pressure system that can make lattes and other espresso-based drinks, as well as brewed coffee. Essentially, Starbucks has said its machine targets a different type of customer.
When Starbucks first announced in March its plans to roll out the Verismo, shares of Green Mountain plunged. Green Mountain’s stock has lost 51 percent of its value since then. Starbucks’ stock is little changed in the same period.
Green Mountain says it’s on track to introduce its own high-pressure espresso system on a limited basis in time for the holiday season.
In addition to the $199 Verismo, Starbucks will sell a $399 model with a larger water tank and LED display that tells consumers when the machine needs to be cleaned. Green Mountain’s Keurig brewers cost from $99 to $189.
By next week, the Verismo will be in specialty stores such as Williams-Sonoma and Bed, Bath & Beyond. Specialty stores also sell other brewers, including the Tassimo by Kraft Foods Inc., which costs between $100 and $170.
