3D Printing is Quietly Thriving Without Mainstream Adoption

3D printing ()

3D printing ()

Silicon Valley first received its name some 50 years ago in reference to a robust STEM research base housed in the area, but today it is home to the some of the most powerful, innovative upstarts in the world. And so, the word disruption has become synonymous with the Valley’s obsession of using advanced technology to solve old market problems.

These days it means harnessing the power of data and artificial intelligence in a real-world context. But before there was Big Data, 3D printing laid claim to the distinction of most rousing technology.

Early advocates claimed cheap 3D printers would jumpstart a decentralized industrial revolution and in the process bring the factory back to the home. In other words, individuals could design and manufacture physical products all while bypassing traditional supply chain channels. Despite these lofty goals, 3D printing proved to be more complicated than loading a piece of paper and hitting print. In addition to complexity, home 3D printers never hit an optimal price point to draw in mainstream consumers.

While the market for cheap home printers never materialized, the potential for 3D technology remains enormous. According to a recent IDC report, total 3D spending is expected to reach nearly $29 billion by 2020 with a majority of global revenue growth originating in discrete manufacturing. For that reason, 3D Systems and Stratasys, two leaders in the space, have shifted resources away from home printers back to high growth, commercial applications.

Stratasys (SSYS), the producer of MakerBot printers, continues to gain traction in additive manufacturing and attracting deeper partnerships with several industry leaders. During the first quarter, the company partnered with McLaren Racing to expand its production of race ready parts in addition to agreements with Siemens Mobility and SIA Engineering Company to help accelerate part production.

3D Systems (DDD), on the other hand, recorded a 3% increase in revenue for the first quarter on the back of greater demand for industrial, materials and healthcare products. In the field of medicine, the technology has the potential to increase precision and improve the overall effectiveness of surgical procedures. Some researchers are even studying applications in tissue engineering such as printing complex cell patterns or organs.

As the market continues to mature, look for well established companies to explore business opportunities in the 3D printing market. The emergence of large, blue chip players like General Electric (GE) and Ford (F) in the past year further legitimizes the recent trend in additive manufacturing. General Electric’s big bet on 3D printings intends to support its efforts to grow as a digital industrial company whereas Ford hopes to print low cost automotive parts at scale. An aggressive push into 3D printing can help revive top and bottom line performance at a time where both companies have struggled to lift shareholder value.

Other functions of 3D printing range from mass producing footwear, which traditionally relies on low cost labor in third world countries, to constructing a home. Earlier this year a new robot from MIT built a dome like structure spanning 50 feet wide and 12 feet high in less than 14 hours. The 3D technology allowed for faster, cheaper and more adaptable construction, but the long-term vision for the project is to build on Mars.

Printing in three dimensions introduces a wealth of opportunities with a broad set of applications, but one unifying factor brings them together; instead of following conventional manufacturing methods, 3D printing starts with nothing and progressively adds layers of material one by one. This has the potential to revolutionize every aspect of the supply chain; opening the door to mass customization, quality solutions, and greater design and innovation.

While the possibilities are endless, 3D printing will begin to face greater regulatory pressure with each additional breakthrough. Regulations on the medical industry, in particular, are already more stringent than other sectors, which raises some interesting questions for health care organizations considering adopting 3D printing technology. Other factors experts believe could hamper growth now and in the future, include high equipment and manufacturing costs, and limited available materials.

For investors to get further behind the trend, 3D printing technology will need to continue growing and adapting to the changes ahead. How well that translates into market performance is still unclear, but the opportunities are boundless.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Trevir Nath

Trevir Nath graduated in 2011 from Rutgers University with a Bachelors in Economics & Psychology. His Psychology and Economics degrees increased his understanding of financial markets from a human behavior perspective. Looking to further his understanding of financial markets, he went on to obtain his Masters in Economics from the New School graduating in May 2014. He currently writes about personal finance, investing and its interaction with technology. His work also appears for numerous financial websites including Investopedia.

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