Your Keurig coffee costs more per pound than steak. That's the plan.

Keurig sells the brewer cheap, sometimes close to a loss. The machine isn't the product. The pods are. This is the razor-and-blades model: give away the razor, sell the blades forever.

Give away the razor. The blades never stop. That is the business.: Brewer, near loss · Pods forever · 2.0 cage, cracked · Keurig's margin

A single K-Cup works out to roughly $40 to $50 of coffee per pound, several times the bagged price. That gap is the whole business. So the pod has to stay locked to the machine. When Keurig's core K-Cup patent expired in 2012, rivals flooded in with cheaper compatible pods. Keurig's answer in 2014: a '2.0' brewer that scanned each pod and refused any it didn't recognize. Buy our machine, buy our pods.

Customers revolted. They called it coffee DRM. Workarounds spread, sales sagged, and Keurig admitted the lockout hurt the business and pulled it back. The model survived; the cage didn't.

The cheap machine was never the deal. You were buying a contract, one pod at a time.