3D Printing: An Evolutionary Move for Graphic Arts Vendors

It is fair to describe 2013 as the year of 3D printing. A range of technologies using additive manufacturing have been finding applications in short-run production, prototyping, manufacturing, and other applications for industries such as architecture, industrial design, automotive, aerospace, engineering, fashion, civil engineering, dental, and medical. What is particularly interesting now is that with this growth, the activity is not only in new product developments and acquisitions, but increasingly in technology and distribution partnerships, particularly with graphic arts vendors.

It is logical that graphic arts vendors are migrating to become more active in the 3D printing market space. In fact it’s more of an evolutionary development rather than a revolutionary one. Many of these companies have imaging technologies that are well suited to 3D printing. In addition, they have the sales, marketing, and service capabilities that are required to support the higher end 3D printing offerings. So it is natural that a series of business developments and announcements have made headlines in 2013 involving companies like Canon, Fuji Dimatix, HP, Konica Minolta, Ricoh, and Xerox.

Here are some examples:

  • In October, Canon and 3D Systems signed a deal with Canon to distribute 3D Systems printers in Japan. This allows 3D Systems to expand their geographic reach while also enabling Canon to create business in a new market and encourage growth into a service company.
  • In November 3D Systems exhibited at Konica Minolta’s North American dealer meeting. Konica Minolta said that a distribution partnership was imminent (no such deal has yet been announced…)
  • Also in November HP announced that it would be entering the 3D printing space, not through acquisition or partnering, but through its own internal development. HP is planning a middle of 2014 launch. If the launch in 2014 is successful, HP could serve as the example of a traditional company moving into and growing in the functional & industrial printing space.
  • And just this week 3D Systems announced another in a series of 2013 acquisitions. It is acquiring a portion of Xerox’s Wilsonville, solid ink engineering and development team. The Xerox news comes shortly after 3D Systems unveiled two new 3D printers in their ProJet series – the 4500 and 5500X. The 4500 uses ColorJet printing technology, which takes advantage of Xerox’s core print head technology, as does 3D Systems’ VisiJet PXL series.

The acquisition appears to serve both companies well. 3D Systems gains 100 Xerox engineers and contractors from a Xerox Wilsonville facility that currently employs around 1,000 people. 3D Systems will lease space and also gain license to key Xerox 3D printing intellectual property. The additional staff should help 3D Systems as it rolls out new products and develops future ones. For Xerox, the deal strengthens a relationship that actually predates its 1999 acquisition of Tektronix, whose solid ink technology is the reason for the partnership. Xerox retains a large number of engineers and other employees and will continue to develop and manufacture heads as well as manufacture solid ink. It also retains the rights to both 2D and 3D intellectual property, which is important for future development efforts for its ColorQube and CiPress product lines.

Of course, graphic arts manufacturers are not the only players looking to enter into the 3D market. Earlier this year 3D Systems also signed distribution deals with the consulting firm Deloitte and IT distributor Synnex.

In addition to channel activity, there have been a lot of acquisitions and mergers. At the very end of 2012, Stratasys and Objet merged, and then early in the year Stratasys acquired MakerBot. This move was part of a strategy that allowed Stratasys to enter the consumer and small business market and compete with 3D Systems’ Cube printer series, which has been in the market for two years.

Not to be outdone, 3D Systems has made a total of ten acquisitions in 2013: Village Plastics, Figulo Corporation, The Sugar Lab, CRDM, Teamplatform, Phenix, RPDG, COWEB, Geomagic, and of course, the Xerox/Wilsonville agreement.

Yet it is this latest move by 3D Systems that reaffirms our assumption that many of the key players in the graphics communications industry are closely looking at participating in this booming market. Many have core technology and intellectual property that can be used in 3D devices. Additionally these vendors are also looking for new markets that leverage their service and support infrastructure.

This agreement is a clear indicator that graphic arts vendors are developing business models that allow them to expand market reach beyond graphic communications into functional and industrial printing based on their core technologies, for example material deposition, as well their strengths in go to market resources such as sales, distribution and support. We will likely see these companies increasingly moving towards functional and industrial printing technologies such as 3D printing in 2014.