Rapid Prototyping Equipment Financing
Forced Retirement
One practice that is pretty much universal in any technologically based equipment is an effort by the manufacturer to kill off its own older machines (and competitors' older systems, too). They do this in at least two ways.
On the positive side, they offer new models with improved capabilities, systems that are more attractive to customers than prior products. This practice is universally received with appreciation, even if it means that owners of older RP systems have to adjust to the fact that their platforms have been upstaged. The best recent example is 3D Systems' Viper, which has effectively replaced a large number of SLA 250's.
An upgraded laser can turn an SLA-500
into an SLA-5000 class platform
High-end systems are not the only ones that can bump off very old platforms. Objet RP platforms have also displaced SLA 250 machines, not only taking out old equipment but also putting users on a different low-end, low-cost path.
On the negative side, a manufacturer can enforce re-licensing of software, which means that when a platform changes hands, the software licensed by the former user will not travel with the machine and the new user must pay the vendor another license fee for the software. Vendors can also undermine older systems if they institute inappropriately expensive maintenance programs, trim the supply of spare parts and otherwise add friction to the support system.
These practices are controversial, because they reduce the availability of perfectly functional RP systems that, if not state-of-the-art are at least a lower cost option. When an RP platform is scarce, its price will be higher than when abundant supplies are available, as long as there is demand.
In the long run, the artificial scarcity of used platforms leads to a correction, and the way this plays out is pretty simple. Buyers who simply cannot afford a new high-end system and cannot find a used one at a reasonable price will try to use a low-end system. Because RP systems generally keep getting better, emerging low-end systems eventually are put to work doing jobs that formerly were only done using high-end systems. Users of these low-end systems may have to make some compromises, or make an extra effort to get acceptable results from their low-end systems, but, driven by necessity, if they can do this they will. When this happens, it spells trouble for vendors whose health depends on the sale of high-end RP platforms.
We are not saying that a change in practices by the makers of high-end RP systems would stop the incursions made by low-end systems. Rather, we want to point out that the pace at which low-end systems can eat into the high-end market may be affected by the size of the middle ground, the market for used high-end platforms at attractive prices.
2055 Reading Road, Suite 240
Cincinnati, Ohio 45202
Phone: (513) 333 0221
Fax: (513) 333 0887