The last 5 years I have been working in the 3D printing space. I have seen 3D printing rise in popularity. It went from a niche technology primarily used for prototyping applications to relatively well known manufacturing technology. You know that a technology is entering mainstream when publications like The Economist start writing about it. In a previous post about what excites me about 3D printing, I wrote that especially the digitization of manufacturing technology and the approach of building parts from the ground up are one of the most interesting aspects of 3D printing. It is a paradigm change in production, which is mostly still subtractive. Basically “beating the material into submission” to get what you need. In this post, I am revisiting that vision.

While watching the rise of hobbyist makers and independent designers / artists making their ideas, products and arts a physical reality, it becomes clear a new market is developing. This market could be described as one-off and small series of products developed by an army of independent designers. Their motivations are between solving a problem they have to the creation of new products or art forms.

The true innovation of which 3D printing is just a part lies in the fact that it enables people to make and manufacture products with relative ease. The setup costs are low, the design-to-manufacturing process is simple, and the manufacturing costs are low for small series. Anybody can basically do it. And it is not only limited to 3D printing. The same applies to laser cutting or CNC. On top of that, standard components of any kind — from charger ICs to lighting fixtures — can be easily bought off-the-shelf via a multitude of web sites.

When taking a broader view, you could say this applies to manufacturing as a whole. Whereby standardized components can be used and integrated into other products to make new products. The manufacturing process is simplified for a lot of products. Even when you open a Macbook Air nowadays, it is wealth of standardized components. The integration and procurement of these components is still quite complex, but it is getting simpler over the years. It is not inconceivable that, at some point, any knowledgeable hobbyist is able to produce his or her own Macbook Air for a relatively affordable price.

While manufacturing is getting simpler and more accessible, the true innovation of products will be in design and manufacturing of the components itself. The design and production of computer chips is a good example of components, which are not easy to design and manufacture — let alone customize. But at the same time mass-production does commoditize these components and they are available to all to buy and use. Remember how many people buy their own computer components and assemble their own computer?

I expect that integration and design of products will be further commoditized over the years. The same applies to software. The first shimmers of this change are starting to appear on the internet. Hardware startups are becoming more common. Pure hardware products pop up on a daily basis on Kickstarter. It is no longer the exclusive domain of large corporations. There is a huge opportunity developing here to enable product designers, hobbyists and entrepreneurs to design and sell their products.

Some time ago, I attended a partner meeting at a VC. At some point during the meeting one of the partners proclaimed that YouTube is full of useless and pointless content which nobody really cared about. I will never forget this rant. He did not understand the power of the internet and it’s distribution mechanism.

Chris Anderson introduced the term “Long Tail” in an article in Wired magazine in 2004. Later in 2006 he wrote a book about it called “The Long Tail: Why the Future of Business is Selling Less of More”. In short the long tail is a theory where companies increase their relevancy by offering large numbers of products even though they sell only limited number of items per product. This became possible mainly because of the internet as a distribution mechanism. The cost of stocking and distribution costs have gone down significantly because of it. Examples of companies employing this strategy are Amazon and Netflix.

The world has changed since 2004. The long tail has been successfully employed by a number of companies, but the tail is getting longer. Way longer. Self-publishing and online creation have changed that. The internet has moved beyond making available what existed or created outside the internet. The internet has become the place of creation itself. YouTube is a good, early example of that. Self-publishing of videos have inspired and entertained millions of people and is still doing that today.

But self-publishing is beyond many of the frivolous videos on YouTube. Services like Lulu.com have over 1 million creators who published millions of books. Using Amazon’s CreateSpace service creators can distribute their book, music and movies to Amazon’s worldwide audience.

Since a couple of years, online creation and self-publishing of products became possible using services like Thingiverse and Shapeways. On demand manufacturing made possible using 3D printing, has moved self-publishing beyond the realm of media and into the world of physical goods. These services still have not reached their full potential and others will join this segment in the coming years, but the change is significant.

The basis of the theory of The Long Tail is underpinned by the fact that the internet lowered distribution costs, and thereby making it possible to offer large inventories to customers. But the rise of self-publishing has changed the distribution mechanism itself. The net effect is that the tail is getting longer each day. It never gets shorter, and for that reason, I would like to rename it to The Infinite Tail.

Products will never go out of stock, and their availability is infinite. Digital shelf costs are low, and they go down each day. The internet has made it possible to distribute individual creations to large audiences. For each creation, there is a potential market — sometimes as small as 1. But with new production technology and distribution mechanisms, the cost of producing and distributing a single item is not prohibitive anymore. That is what I call The Infinite Tail.

3D printing has been around for decades, but the technology has gathered more mindshare and media attention in the recent years. Still the state of the industry is in its infancy and is tiny ($1.7B) compared to the making industry as a whole ($280B) [source]. There are a lot of opportunities in the market. In this post, I will explore where I think those opportunities are.

Although the 3D printing industry and products reside in different segments, for the purpose of this article I will focus on 3D printing to manufacture goods / products. In this context, it does not really matter if it is a semi-office printer or a manufacturing-grade machine.

In general, I see 3 areas for value creation in the 3D printing market. These are:

• Marketplace
• Manufacturing
• Equipment

Marketplace
The top of the vertical is the marketplace. It is the interface to consumers. It adds value on top of manufacturing by selling and distribution of products to customers. The essence in this area is empowering consumers to cope with the wealth of products and variations of products. These will become available due to endless product life cycles and the extremely low barrier of entry for product designers. The ability for limitless options for personalization and customization will also have a significant impact on the marketplace for 3D printed goods. Personalization and customization are new features and attributes to products which will be unlocked thanks to 3D printing.

Current market places are rigid and focus on in stock items. They will not be able to easily adapt or tap into this new market. The market place needs tp be redefined to enable the new way to select and buy products made using customized and one-off production.

Manufacturing
With regard to 3D printing, you see different types of business models at work currently in manufacturing. Most of them are geared towards low volume, high margin opportunities. Not many companies specialized in 3D printing are employing the high volume, low margin business model. Though that is where the value in manufacturing is created. Essentially it is chicken and egg problem. As long as there are no real 3D printing factories, then there will be no demand. With no demand, nobody will build a factory. The technology — speaking of machines and materials — is still immature to a certain extent and relatively unknown in its application to a lot of manufacturing engineers. I expect the industry to bootstrap itself in the next 5–10 years.

Another challenge is the lack of off-the-shelf solutions and tools necessary to support 3D printing and one off production. Most equipment and software for 3D printing is delivered and operated as an isolated island. Integrating them into a larger environment or finding specialized equipment to support the 3D printing process is hard or it does not exist at all.

I expect that significant value creation is going to take place in both tools — meaning hardware and software — and in building and operating manufacturing plants.

Equipment
Obvious as it may sound, there are huge opportunities for equipment manufacturers. The current state of affairs is that the current systems are relatively limited in their applicability, and do not yet meet requirements necessary to mature this industry for manufacturing. For instance, the reliability and fault tolerances still leave things to be desired. Next to that, the choice of good, relevant materials is limited. Current equipment manufacturers are very much focused on capturing the SME market for prototyping and understandably so. There is a real world demand in this market segment for making prototypes fast and easy. Cool as it is, that is not manufacturing.

The oil of the industry
Around — or between if you will — these main areas, there are opportunities as well. For example, tools and service companies providing support to companies in the main areas. I see them as the oil smoothing the value creation in the vertical, making it easier to build and extend the main companies. Although it seems niche, I think major opportunities lie in this area as well.

A great example is what Kiva Systems is for ecommerce and distribution with their specialized warehouse management and automation systems. They have been recently acquired by Amazon.

Design and creation
I don’t believe there is a lot of value creation possible in design tools. Although it receives significant mindshare in the industry. Of course, design software will get better and some companies will make money of it. But it will be a crowded market with large market share for a few off-the=shelf software packages and lots of small home grown solutions. The competition in this market will be fierce. It is an important aspect to enable consumers to access the capabilities of 3D printing, but the value creation in this area is hard.

Materials
Materials are interesting too. But the equipment manufacturers resist that at this moment. They try to emulate HP’s business model by monopolizing and protecting their own market for materials. Though this could make sense in the consumer and SME markets, it does not make a whole to of sense in the manufacturing market. I see this as a major hurdle the industry need to overcome to open up the market to real world manufacturing. It will allow for bigger innovation on materials, and it makes the technology a more viable option. Companies can tune the materials to their requirements instead trying to fit the existing materials on their design requirements.

Conclusion
There are lots of opportunities in the 3D printing market. I expect that the existing marketplaces like Amazon will move into customized and one-off manufactured products when the industry starts to mature. These are great exit opportunities for current market places. At the same time, you could perceive it as a threat to these market places. The consolidation may not happen, and maybe they will enter the market on their own. Time will tell which direction the market places will go.

Manufacturing has major opportunities. But it can only grow and foster when the equipment manufacturers start to build systems and platforms to allow manufacturing. An important prerequisite is that they open up their equipment for new materials and stop monopolizing the material market for their equipment. Both the manufacturing industry as well the equipment manufacturers are going to benefit from that. Given the fact that the manufacturing market is so much bigger than the 3D printing industry is today.

An important part of the 3D printing industry ecosystem are the companies who tie the different segments of the vertical together. There is room between all segments for new opportunities and a lot of innovation is going to happen in this area. I think this is one of the exciting space to watch over the coming years.

Over the past months, I wrote several articles about the impact of 3D printing. In this last article of this series, I am writing about the impact of 3D printing for consumers.

From a consumer’s point of view, 3D printing has two major impacts:

• Affordable one off production
• On demand manufacturing

These two aspects can have a major impact on how consumers select and buy products. In this post, I will explore what the consequences can be.

The most obvious one is that consumers get more choice. Out of stock does not have to exist anymore. Products can be produced on demand when there is demand. It is like the on demand printing of books offered by Amazon when the original book is out of print. WIthout the necessity to build a large supply chain or keep stock, the risk for companies and product designers is lower for the introduction of new products. I expect a significant increase in the number of available products. Especially niche products will become commercially viable. Similar to the out-of-print books at Amazon. Extending that metaphor, there is no longer a need to end a product life cycle. Products can be available forever. This goes beyond the products itself, but can extend to spare parts, as well. Or even improvements or extensions to an existing product.

Another one is that products can better fit the needs of their buyers. One off production enables significant options for personalization and customization of products to customer requirements. This will lead to higher product satisfaction with buyers. They no longer have to choose the best of the rest, but they can actually get a product which they have in mind. This will increase the value perception of products by consumers.

It can also lead to better products. By continuous designs updates based on feedback from users, the product can be improved with each production run. It is also possible to adapt products for special use cases where today a one-size-fits-all product is the only option.

In short the impact on consumers can be summarized as:

• more choice for consumers
• endless availability of product
• better product fit to the needs of its users
• better products

3D printing and one off production will have a significant impact on consumers, and how they select, buy and perceive products. I do not expect that all products or product categories are affected though. Custom jewelry has been around since forever and although it became more affordable to buy personalized jewelry, it still very common to buy off-the-shelf jewelry at the store (and I am not counting engraving here). The change will be gradual and will move from niche and expensive to popular and affordable products.

In my series on the impact of 3D printing, I wrote about my views of the impact on supply chain and product design. In today’s post, I write about manufacturing locations. This topic has already been partly covered in the post about supply chain, but I think there is more to say about it.

Manufacturing takes places all over the world. But the bulk of our manufacturing takes place in Asia. I expect that 3D printing has the opportunity to change that. 3D printing offers benefits over mass production like:

• one-off and small series production
• multiple products coming out of the same production line
• semi automated production lines
• smaller factory footprint because of all the above.

Looking at these benefits, I see new directions for manufacturing, which have an impact on the location where production will take place. The directions I see are:

• manufacturing closer to major markets — in essence bring manufacturing back to the West localized production near large population concentrations
• insourcing of production by non manufacturing companies
• around the corner production (Kinko concept)
• home manufacturing (home printers)

Manufacturing closer to major markets
We produce in Asia because it is cheaper to manufacture overseas and ship it back to us than to produce it locally. Now this concept works great for mass-produced goods, but with 3D printing it may change. With lowering prices of 3D printing equipment and materials, it can tip the balance and make localized production possible.

Localized production near large population concentrations
Given the above, it makes more sense to move production closer to large cities or near central distribution hubs similar to warehouses of big retailers like Amazon. I can even imagine that some production will take place inside those existing warehouses.

Insourcing of production by non manufacturing companies
Beyond making production local, certain companies or organization can start producing themselves. The benefits to be able to produce on demand on-site can in certain cases very compelling. For example, a hospital which needs specialized tools for operations or tailor-made items for patients. Or car shops who need to special parts to repair a car. In these cases, it saves time, costs and inventory to have produce them in house.

Around-the-corner production (Kinko concept)
When 3D printers become more capable and their use more ubiquitous, the next step is to go hyper local. Local shops in convenient locations (a la Kinkos) open and offer local pickup and on-demand 3D printing options to businesses and consumer alike.

Home manufacturing (home printers)
And there is the option of home printers where consumers can print their own products at home.

There are considerations to take into account on how the future will unfolds itself. One consideration is the acceptance of customers of build-to-order products versus off-the-shelve products. Build-to-order offers freedom, but at the same time does not deliver instant gratification. Off-the-shelve delivers that instant gratification, but the customer is limited in choices. The other consideration is that the applicability of 3D printing is different in each product category. The applicability could be limited to shells or components for some, while others are completely manufactured using 3D printing.

There are many opportunities for 3D printing to have a major impact on the manufacturing locations of products. If you look at 2D printing business environment, I can imagine something similar for 3D printing. In 2D printing, you have many options to print. Each of these options is specialized in certain markets or services. But foremost they are complementary to each other. I expect nothing less for 3D printing.

Fred Wilson — VC @ Union Square Ventures — often recites his rule of thumb of social internet services. It is the 100–10–1 rule. He sees with social internet services that on average 100% of users consume, 10% of users interact and 1% of users actually create.

So how can we apply this to personal fabrication? As a social service, there are many options for personal fabrication. I am thinking of:

• sharing of designs between designers
• making designs available for fabrication to others
• cooperative design of products between designers and users
• product configurators made by designers for users
• online creation tools for users which interact with all the above

All these options can make personal fabrication a social activity. When you apply the 100–10–1 rule of thumb, the opportunities for scaling such a service become immediately clear. As far as I know there are no exact figures available on how many 3D modelers / product designers there are in the world. But let’s assume there are 5 million of them. That would turn social fabrication into a 500M users opportunity. That is Facebook and Google territory. Just imagine 50M users interacting on personal fabrication and the effects it can have on product design and how we design products. This is a very significant opportunity. Of course, the big caveat is that not all 3D modelers / product designers are interested in social fabrication. Maybe only 10% or less. That still leaves a 50M opportunity.

I do wonder what will happen to this ratio. I think it will change over time. I have no data available how this ratio looks like per demographic, but I can imagine that young people are much more engaged to create and interact than older generations. Now when they get older, start their careers and families, I can imagine that some of them drop off. But in general I expect that the creators and interactors groups will become a larger portion of the total users.

Three weeks ago, I wrote about how 3D printing as a manufacturing technology can impact supply chain. This week I am writing about the impact on product design and then — especially — on the design process as part of the overall manufacturing process. I expect here the biggest impact will manifest itself. 3D printing has also impact on the design of products itself. But that is a topic for another time.

So let’s talk about product design process. For mass-produced goods, the design step is extremely critical. It involves many disciplines from designing the product to sourcing components and finding production partners. The product is thoroughly tested, because it is expensive to make mistakes due to the large production batches. The result is that the product design process is long.

A high level mass-production manufacturing process can be broken into the following steps:

1. design product
2. prototype product
3. test product
4. manufacture product
5. distribute product
6. sell product

What kind of impact can 3D printing have on this process? The strength of 3D printing is the ability for small series or one-off production runs. The effect is that it shortens the lead time of a product and reduces the manufacturing risk due to smaller batches and just-in-time production. These effects have an impact on the design process. It can be leaner and can iterate faster through improved product versions than is usual today. New improved product designs can be taken into production immediately, and the changes are instantly available to customers.

To sum it up the impact of 3D printing on product design process is:

• Ultra short lead times
• One-off or small series production
• Instant design changes are incorporated into the manufacturing process
• Limited exposure when product fails

These benefits will have an effect on the design process. They will enable new, innovative product design processes. I like to group them as follows:

• Lean Product Design
• Continuous or Iterative Design
• Collaborative Design
• Distributed Design

Lean Product Design
This is basically an adaptation of the design process for mass-produced products but then employing the benefits of 3D printing. The major difference is the ability to improve the product during its normal life-cycle.

• design product
• manufacture product
• distribute product
• sell product
• improve product

Continuous or Iterative Design
A step up from Lean Product Design is Continuous Design. Here, a product design is continuously updated or adapted to match changes in trends, environment or new use cases for the product. A good example is a phone case which is adapted for new models coming out on the market. These adaptations are outside the normal product life cycle.

• design product
• manufacture product
• distribute product
• sell product
• market changes / feedback

Collaborative Design
Due to the short lead times and small production runs, designers and customers can start collaborating on product design. Although this is a high touch and expensive design process, for certain product categories it can make sense. A good example is personalized jewelry. Sometimes, this is called Co-Creation.
There are several options how the collaborative design process can be executed:

• Designer designs, customer gives feedback / input
• Designer designs, customer modifies / improves themselves
• Customer designs, designer improves / finishes

Distributed Design
The digitization and homogenization of the production process allows for sharing of product designs or parts of a design. In turn, these shared designs can be used as a basis for a new product design. I call this distributed design.

• Select Designs
• Design Product
• Share Design

Conclusions
The impact of 3D printing on product design processes is potentially significant. It allows for quick iterations of designs and enables sharing or reuse of product designs. Designers can cooperate more closely with customers on the product design and can quickly react on changes in the market or environment. While 3D printing matures, I expect that design processes will adapt and change in significant ways. I am curious to see how it will actually affect the products itself. Will these change significantly? What is the impact on trends? Is the perception of consumers on how things are made and work going to change?