Is '3D Printing' a set of niches within niches? Roll on 3D Services

Analyzing the 3D Printing marketplace is not so easy. The term '3D Printing' is largely a media invention. As we have stressed before, '3D Printing' refers to a dizzying array of very different Additive Manufacturing (AM) technologies (layer by layer, drop by drop, voxel by voxel) sharing little in common. It is not unreasonable to suggest that many of these techniques are still very much niche technologies. That may change rapidly in the future. Today, however, even companies with viable 3D printing products appear not to be able to make it on their own.

Phenix Systems is the latest casualty. The company, like so many before it, has been acquired by 3D Systems, the aggregator of the nascent additive manufacturing industry. Founded in 1986 the giant of the AM industry still only has 1000 employees today.

Why this new acquisition in a long list?

Phenix Systems manufacture a range of Direct Metal Laser Sintering (DMLS) 3D Printers. DMLS is one of over thirty very different 3D Printing approaches. Yet even within the narrow field of DMLS there are many specialist processes. Phenix can 3D print chemically-pure fully-dense metal and ceramic parts from very fine powders with a granularity of 6 to 9 microns. Materials include stainless steel, tool steel, super alloys, non-ferrous alloys, precious metals and alumina for a variety of aerospace, automotive and patient specific medical device applications. That sounds like a huge deal. Perhaps not. Despite owning patents in this area, Phenix decided they could not make it on their own and have thrown in their towel with 3D Systems [NYSE: DDD].

Why this continuing AM industry consolidation?

Phenix Systems DMLS 3D Printers

Is it that the market for what Phenix do is just too specialized? Is it that their products only make sense if developed and marketed under a broader banner? Is it that 3D Systems sought controlling patents in this area and made an offer that Phenix could not refuse? Or is it a sign of 3D printer product commoditization?

The acquisition of Phenix Systems by 3D Systems continues a past pattern, buying up specialist companies to flesh out a solution portfolio. It highlights the nature of this marketplace: a set of niches within niches.

In such a market, customers want services, not products.

AM users do not want to buy a slew of different 3D printers to cover all possible needs, materials and processes. Nor do they want to buy into an expensive 3D printer (and everything else required to operate it) only for it to become obsolescent when a new model comes to market offering higher resolution or material stability! Companies looking to re-engineer their manufacturing to take advantage of AM don't want products, they will seek out a trusted relationship with an end-to-end solution provider, a partner who offers rich AM process options and a consistent tool chain, with integrated software.

What the media call "3D Printing" should really be called "3D Services".

What the Phenix story and others like it show is that 3D printer makers simply cannot make it on their own. Why is this?

There is no standard 3DP platform upon which to innovate new products via innovative applications. With no standard platform, 3D printer makers cannot prosper as other companies invest and create applications for them to run on their platform. This is why comparisons between "3D Printing" and the early days of the computer industry are null and void. There will be no Apple, Microsoft or Amazon of 3D Printing. Additive Manufacturing's growth is not product centric. It is a complex ecosystem of niche products, set within a broad services innovation framework.

For all of these reasons the growth curve of the 3D printing industry will not look like the exponential growth curves and hyper valuations of the digital computing industry. Rather, it will look more like the Information Technology (IT) services industry: slow and steady steers the ship.

Further: As 3D printers become more and more a commodity item, it won't be possible for 3D Systems to buy up every company on the block. Just as in the computer services industry there will be a range of services and solutions providers for every pocket and every sector of the market. They will compete not on ownership of 3D Printers and 3D Printing patents, but on what every mature industry competes on: customer service and alignment with customer needs.

Wikipedia on 3D Systems

Who is right about 3D printing? Foxconn or GE?

We live in strange times. Just as Foxconn CEO Terry Gou says that "3D printing is a gimmick and has no commercial value", GE CEO Jeff Immelt says he would love to 3D print jet engines ... or at least some of their largest parts.

“We make a turbine blade that is made of some of the most expensive high-heat material in the world,” Immelt said. “We put that blade through the fabrication process and the excess material is essentially waste.”

GE hopes to one day use the technology to create engine parts in a more efficient and less costly way. It would also cut down the time to design and develop an engine by half. “We’re a company that wants to own our supply chain,” he said. “This is going to be a great place to put capital.” And as we reported GE is making plans to grow better fuel nozzles.


Why these differences of opinion?

3D Printing is all about materials. Foxconn is one of the world's largest electronics manufacturing companies. It is harder to see the relevance of Additive Manufacturing to Foxconn at this stage. For GE, however, the laser sintering of powered metals has many applications.

We've said it a hundred times before 3D Printing is not one technology. There are over thirty different processes, each optimized to different kinds of materials, and they share little in common. While there could be some convergence in the far future, expect these differences to continue to generate differences of opinion about the industrial significance of 3D printing.

And that's why any analysis of the impact of 3D printing on a certain industry depends on detailed and current knowledge of the available and reliable additive manufacturing techniques.

Windows 8 knows about 3D Printing - Native Driver Support in Win 8.1

It looks like Make Buttons really will be coming to a desktop near you ... Microsoft has even created a new icon for 3D Printer Devices in Windows 8.1

In among all the complaints about Windows 8, and Microsoft's efforts to counter the advance of Apple OS X, it appears they are staying true to their course and adding new APIs for new devices .... the latest being Native 3D Printer Driver support for devices such as the Cube and the Makerbot!

Here’s what Microsoft has said about this:

"For app builders, it offers an application programming interface (API) for app developers to send their 3D models to, just like apps have been able to with 2D printing for a long time. For hardware developers, they can provide drivers that are automatically downloaded and configured when the user plugs in their new 3D printer. Windows 8.1 provides the helpful job spooling, print queue management, and UI support that it always has. And what’s great about this is that app builders can send their content to lots of 3D printers with no special work for each device – including those that haven’t even been designed when the app is shipped. For 3D printer devices, one of the challenges has been getting lots of interesting content to print. Now, these 3D printers can get content from any app that supports 3D printing in Windows 8.1, with no special work for each app, and even work automatically with apps that ship in the future."

Whether or not Microsoft believes Personal 3D Printing (P3DP) will go mainstream is unclear, but they don't want to be left out of the action if it happens. There is even an rumor that Microsoft is going to start selling 3D printers at Microsoft Stores.

MakerBot - who have been acquired by Stratasys - is coming right out of the gate with a new 3D printer driver for Windows 8.1 that offers “plug-n-play and seamless end-to-end printing from a wide variety of applications directly to the MakerBot.”

And here is a video showing 3D Printing from Windows 8.1. What's striking about these demos is that it is clear that with 3D Printing, It's the Software Stupid.

Layer by Layer asks: Is the Personal 3D Printing Revolution Slowing Down?

While the debate rages about whether or not consumers will want 3D printers at home, start up LayerByLayer is making that assumption. The company is attempting to make it as easy as possible to source the best 3D designs for great 3D printable product and have them 'materialize' on your very own 3D printer. 

As they say "Right now, the technology is too inaccessible for non-technical consumers to find useful, and the majority are left asking, "What can I actually do with this?" It’s our job to change that."

LayerByLayer are realistic about the market. In an intelligent blog entry entitled "Is the Personal 3D Printing Revolution Slowing Down?", they point to research by respected AM industry analyst Wohlers Associates, which found that the growth rate of the personal 3D printer market for 2012 was significantly lower than the growth rate in 2011. 

LayerByLayer are correct to point out the following:

• The 65,000 people that have so far purchased Personal 3D Printers didn't care about their reliability and capability limitations—they just wanted to play with a cool new toy. The next 65,000 people, however, will need to see true usefulness of the technology before they consider buying a printer.
• 2012 saw significant advancements in printer technology. Prices dropped, reliability improved, and layer heights decreased. But there are other factors preventing general consumers from using printers that haven’t been addressed—mainly, accessibility and functionality. 
• The average consumer asks, “What can I do with a 3D printer?” Until we can give a good answer to this question, why should they want one?
• Computers weren't widely adopted until VisiCalc became available; printers won’t be adopted until using one is as easy as finding the exact 3D product you want and clicking “Print.” As long as printing involves personally designing an object, or downloading a file and messing with printer settings, no average consumer will ever want a printer in their home.

It will fascinating to see whether innovative services such as Layer By Layer can create the 'Killer Apps' that will persuade more consumers to want a Personal 3D Printer in their home. 

Stratasys buys MakerBot to counter 3D Systems Cube

Recently there has been rumors of Makerbot Industries being up for sale / acquisition. Now we know the facts: the company has been acquired by 3D Systems' rival Stratasys. I suppose it was obvious really. 3D Systems [DDD] has the Cube, now Stratasys [SSYS] has the MakerBot.

There is space in the market for both of these lower-end systems. The acquisition of MakerBot by Stratasys however tells us something important about the broader market for Additive Manufacturing.

When Stratasys and Objet 'merged', which followed the acquisition of ZCorp by 3D Systems, we asked whether this consolidation was a sign of growth in the sector, or a rush to artificially bolster revenue and profit?

Read our original commentary here

Now the MotleyFool are saying roughly the same thing.  In an article entitled Stratasys Buy Shows 3D Industry Getting Ahead of Itself they explain how investors are advised to look carefully at the different sectors of this complex market, before assuming that buying into the two largest consolidating firms is a sure recipe for success.

Whether or not you win by investing in DDD and SSYS, the reality for Stratasys was this: how could they let arch-rival 3D Systems steel away the potentially lucrative (underlined) consumer/maker market all by itself. Stratasys must have carefully weighed the options of make versus buy in the plastic FDM space? What they have bought is a great brand and advocate: Makerbot founder Bre Pettis.

And maybe things at MakerBot are not all clear cut. As this blog has commented before, the number of plastic FDM 'RepRap' inspired printers out there is now over one hundred, and while many won't make it beyond the start up stage, their very existence proves that the technology is not so complex to re-create. Imagine HP buying into one of these companies. Not in your lifetime. HP and any other large manufacturer could re-create the technology of the Cube, Makerbot or Ultimaker very easily. Even so, they may not choose to do so. For the reality of 3D Printing for consumers and makers is that it is a services-rich business, as Shapeways and i.Materialize show only too well. It is not so clear that we'll all have 3D Printers at home.

So is the Motley Fool right to point to the industrial markets and the more advanced additive manufacturing technologies for the future growth potential? Or is there a massive untapped consumer/maker market just around the corner if the 'Killer App' can be found?

It all goes back to those arguments about Hype or Hope in 3D Printing.

GE Aviation to grow better fuel nozzles using 3D Printing

GE Aviation working with Sigma Labs are advancing quality processes in the Additive Manufacturing of jet engine components such as fuel nozzles. 

A 3D Printed jet engine fuel nozzle can be 25 percent lighter and as much as five times more durable than the current nozzle made from 20 different parts, say GE. The nozzle can, for example, better resist carbon deposits and coking. 

The new "in-process inspection" technology can collect all the (big)data from production sensors and analyze the stability of the Direct Metal Laser Sintering (a.k.a. melting) "3D Printing" machines. The video tells the story:

By 2020, GE Aviation will "produce more than 100,000 additive manufactured components for the LEAP and GE9X engines, in development for Boeing's new 777X plane. GE will install 19 additive manufactured fuel nozzles on every LEAP engine, which has amassed more than 4,500 orders."

Rumor of MakerBot up for sale / acquisition

There are rumors of MakerBot being up to sale or acquisition. Huh? They only got started!

Very difficult to know what to make of this story at this stage:

http://mashable.com/2013/06/06/makerbot-acquisition-talks/

MakerBot Industries grew out of the RepRap community ... open source hardware and software for plastic (ABS, PLA) Fused Deposition Modelling (FDM).  This is the simplest form of 3D printing .... in essence squirting a suitable thermoplastic out of a tiny nozzle to build up an object in thin layers.

Founders and 'RepRap' prototypes

MakerBot have commercialised the FDM process in a range of low cost 3D printers for the  'Maker' community. They also sell to some corporates who use the low cost of the printers (roughly the same as a high end laptop) to experiment with the approach. NASA has apparently bought a few tens of these printers.

Due to its roots in open source, and the easy replication of the commodity technology, a hundred (literally) other start ups have brought 'similar' devices to market. (See the list left of this page).  Most of these FDM start ups are one or two man band companies. MakerBot is considerably larger and has been the most successful in commercializing the technology. However, there are valid competitors. Two examples are Ultimaker and the Cube series of FDM printers from additive manufacturing giant 3D Systems.