The race to the bottom is over. Or is it?
These are tumultuous times in the world of 3D printing. Since the expiry of the initial process patents back in 2008, a highly competitive environment has evolved. Today we see incredible technological advances and amazing equipment and materials available at low cost.
That competitive environment has forced changes in many companies, sometimes deleting them from the market entirely.
Let’s take a look at some of the big changes in the past to better understand where we might be headed in the near future.
Around 2010 there was an explosion of desktop 3D printer startup companies, all servicing the relatively small DIY market. All hoped there would eventually be a massive consumer market that they could sell into.
The initial desktop companies typically launched using open source principles, which allowed them to build on existing knowledge, and also aligned with the DIY community for sales.
Around 2014 it became clear that the consumer market would not appear because of the complexities of the hardware, software and content involved in desktop 3D printing.
Low cost Asian manufacturers began to appear, legally leveraging the open source designs made by the startup companies. Their manufacturing capabilities ultimately offered similar products at lower price points.
Around 2016 many desktop companies previously working towards the consumer market shifted into the educational or professional market (dental, architecture, prototyping, etc.) They realized they could just not compete in the “race to the bottom”. The new markets were underserved and offered more profit.
At this time many 3D printer startups failed — usually the ones that didn’t migrate — and the number of 3D printer Kickstarters by inventors in garages began to decline.
Professional equipment makers saw their markets being slowly absorbed by migrating desktop manufacturers. They reacted by developing new materials, finally enabling production use of 3D printing. This was an area the desktop makers could not easily enter, and it made those manufacturers “safe” from low cost competition. However, persuading manufacturers to use “additive manufacturing” was quite challenging and is still the case today.
The competition in the professional market increased, with dozens of 3D printer options. Some makers reacted by developing “high temperature” capable equipment that could print new engineering materials. That made them safe, for a while, as few machines offered that capability.
Some professional manufacturers tried to make their sales environment safer by establishing “sticky” ecosystems where a customer invests not only in the machine, but also materials, software, process and services. That makes it much harder to move to a competitor, especially for larger companies with many machines and participants.
Later, multiple professional equipment manufacturers were absorbed by a few growing entities that intended on scaling up to offer end-to-end technological capabilities and a kind of “I’m the biggest” competition. These acquisitions were largely fueled by venture capital investment.
Asian manufacturers continued to increase their products’ capabilities, quality and most importantly speed. In the past few years high speed devices with very good quality have become available at very low cost. These machines now functionally rival professional equipment that’s sold at far higher prices.
A crisis in the professional market is now emerging, as companies realize their customers might choose low cost products instead.
A similar crisis is emerging in the desktop market, where companies unable to migrate to high speed, low cost equipment face significant loss of sales.
What will these two segments do? I suspect that the desktop makers might attempt the same move others did previously: migrate to the professional market. However, this time there’s already very established players, so that might not be nearly as successful.
Professional manufacturers have a similar dilemma, and might consider migrating to the manufacturing space. That segment is vastly larger and underserved, but doing so requires considerable expertise that would be very expensive to acquire. Making prototypes is very, very different from true production.
It may be that we will soon see the downfall of multiple desktop and professional 3D printer manufacturers.
