In retrospect perhaps not the most surprising development, 3D printing giant 3D Systems has discontinued the Cube, their flagship consumer 3D printer option. Why did this happen?
A press release states that the device will be moved to end of life status, and manufacturing will be discontinued. However, the USD$999 device will continue to be sold as inventories permit.
The company also announced they’re shutting down their Cubify brand at the end of January. The Cubify.com site was their central point for managing consumer-related 3D printing activities, including not only selling Cubes, but also selling materials, providing a wide range of 3D model generator apps, support and more.
All of this will be gone on January 31st.
For those still owning and operating Cubes, including a great number of educational institutions, materials for the desktop machines will still be sold by 3D Systems, just not from the soon-to-be-defunct Cubify site. This is a critical item, as The Cube requires proprietary materials cartridges to operate, available (mostly) only from 3D Systems. It’s not clear for how long 3D Systems will supply cartridges, but we suspect by the time they run out, most Cube owners will have moved on to other equipment.
So why did this change in focus occur?
The press release states:
Management believes a greater focus on manufacturing applications and delivering new and enhanced manufacturing systems can drive adoption, yield higher returns on investment and increase earnings. As part of this shift away from consumer products, management expects revenue to be impacted by less than 2% and profitability to improve. In addition, management expects to record a charge in the fourth quarter in the range of approximately $19 million to $25 million related primarily to inventory write downs and related purchase commitments.
In this case, “management” means the new guys who are directing 3D Systems after the recent departure of long-time CEO Avi Reichental, whose strategy to develop consumer-based 3D printing options is now all but gone.
The company is redirecting their efforts to focus on higher-revenue industrial applications, which is not a surprise to us. We've heard rumors of vast stocks of unsold Cubes stored in warehouses, but could not verify this was the case. If true, this would have been one of several reasons 3D Systems chose to switch focus. Many 3D printing companies have been switching focus in the past two years due to the lack of growth in the consumer sector, in spite of considerable efforts by large companies.
While smaller desktop 3D printer manufacturers switch focus from consumers to educational and professional markets for their lower-cost equipment, 3D Systems has decided to simply cut out the consumer segment and rely on their existing (and more profitable) commercial and industrial market segments. It’s an easy move for them, but tells much about the state of the consumer 3D printing market.
Indeed, their consumer competitor MakerBot does not even have a dedicated booth at the upcoming Consumer Electronics Show, implicitly suggesting they are no longer a consumer product. It seems now that 3D Systems is sending the same message, albeit a lot more bluntly.
However, 3D Systems DOES have a booth booked for CES - by far the largest one in the 3D Printing area, as you can see in this floor map. What will they display? One thing we know is that they won’t be featuring The Cube.
More analysis to come…
Via 3D Systems