The 3D Printing Panic: Why IPR isn’t really the problem

A lot of managers start biting their nails whenever they hear that 3D printing will ignite democratized production. This could indeed leave everyone free to copy and print whatever they want, while making IPR (Intellectual Property Rights) Management extremely complicated – if not impossible.

However, what many don’t realize is that the fulfillment of this prophecy depends on predictions that are relatively far fetched and even if they do come true, history shows us how companies can still thrive when an industry goes digital, despite the piracy potential.

Let’s look into the story of a classic industry gone digital and then look at the situation of the manufacturing industry in order to see why managers can start growing back their nails.

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The Music Industry IPR example

If we assume that all requirements are fulfilled and it becomes relatively easy for anyone to print almost anything: What happens then, as the wider manufacturing industry goes digital? Well, as Genis Roca explains, the story of when the music industry went digital can act as a good representative of what is to come for other industries.

The substitution

The digitization of the music industry started when the digital CD format was pushed forward by the industry to substitute the analog vinyl standard, mainly due to the outlook of cost savings. Soon enough music albums were being ripped, burned and distributed freely from peer to peer as mp3 files with the help of the internet – which was clearly bad for album sales. The industry was basically disrupted by its own eagerness to exploit the digital opportunities.

The transformation

After multiple failed attempts to battle illegal distribution of music, companies had to face reality: Avoiding piracy completely was impossible. What happened next is very interesting, as the industry had been forced to reconsider the underlying logic of how to create and deliver customer value superior to the piracy choice. This meant that new service-oriented business models successfully emerged, as is exemplified by the various music streaming services such as Spotify. In recent years, these business models have been exhibiting the highest growth, as music subscription revenue was accelerating at 51% already in 2013, according to IFPI. The music industry has seen the transformation in new business models towards more servitization that serves as a viable and convenient alternative to illegal downloads.

In conclusion, the consequence of going digital is a change in the composition of revenue streams, since overall income from physical album sales decreases relatively, while revenues from licenses and royalties etc. increase. And yes, there will always be individuals who keep track of all the new music releases and spend their time locating and downloading the latest albums from torrent sites. But as it turns out, millions of people just want access to the music they like in an easy and fast way, which leaves room for service solutions. So, in spite of all the reasonable piracy concerns, it appears that there are still ways for companies to flourish in the post-digital music industry.

The general rule: Think service and platform instead of product.

A digital manufacturing industry

After putting things into perspective, let’s now look at the digitization of the manufacturing industry, and just how likely the proclaimed democratization of production really is. In order for mass market consumer 3D Printing to become a viable, convenient and attractive alternative, a number of technical and consumer behaviour related barriers are present.

The technical requirements, or rather barriers, speak for themselves. To name a few, there is a lack of available materials, no real established standards or certifications and the quality generally cannot match conventional standards. Plus, a lot of post-processing is needed in most cases if you want to get anywhere near a decent result. The cheaper consumer 3D Printers will most likely never completely overcome these barriers. Consequently, even very smart and technically gifted consumers with a lot of time on their hands will still not be able to compete technically in a guesstimate around 90% of product categories.

Even if all of these mentioned technical barriers will be overcome with time, 3D Printing will not – and I repeat – will NOT substitute conventional manufacturing completely. The outlook of the technology ever becoming cheap and fast enough to battle out the efficiency of conventional methods for large series production is so nano-thin, that I dare bet my right arm it will never happen. And I’m saying that as a righthanded person.

Instead of complete substitution, it makes a lot of sense to use 3D Printing in a complementary way, 

for instance to fabricate key product components with special geometric, functional or customization needs.

The 3D Printer in your cupboard

The other category of requirements is the need for a change consumer behaviour, since most people are simply neither capable of or interested in producing their own stuff. It just takes too much energy and time to print for instance your own lamp or cutlery at home. Sure, there are people who love tinkering around with 3D Printers and will insist on making some things themselves – but according to the widely accepted principles behind the Technology Adoption life Cycle, these ‘techies’ or ‘innovators’ account for less than 3% of the population.

Moreover, one of my favourite analogues to this change in consumer behaviour is the classic juicer example by Joris Peels. Remember the time not so long ago, when people were so enthusiastic and felt so empowered by the thought of making their own fresh juices and smoothies every morning? Sounds good, doesn’t it? The juicers and mixers were simply ripped of the shopping shelves! And today, how many do you reckon gets up every morning to make their freshly mixed smoothiejuices? That’s right, no one is doing that. And if you are, then wow, you are quite something out of the ordinary! In the same way, consumer 3D Printers will in for way too many people likely end up next to the dust-collecting juice-machine in the cupboard.

Surely, the maker movement is great and it is growing day by day. But even so, other normal people’s consumption habits are very hard to change, even if they want to. And let’s face it – if you can’t compete with a bunch of guys in a garage, you’re becoming a dinosaur.