3D Printing is all the rage these days, and for good reason. Those skeptical of the companies manufacturing these products believe the stocks are overvalued. Those bullish on the industry believe the sky is literally the limit, with regards to how transformative 3D printing could be in any number of industries. I tend to come down on the side that valuations today do not matter for companies such as 3D Systems (DDD) and Stratasys (SSYS). These companies have just scratched the surface in a market that nobody today could even begin to give a realistic estimate of how big it could become in the future. However, I would not touch these companies as an investment. I feel investors are overlooking the fatal flaw in the business models of companies that compete in this field. The flaw is that ultimately, the products that can be created through 3D printing have the possibility of being used for nefarious reasons. These range from the mundane copyright or patent infringement issues to the extreme where products are printed with the purpose of causing harm to people. The liability for companies such as 3D Printing and Stratasys, when their products are used for illegal purposes or to cause harm, are just as incalculable as the future growth prospects.
3D Printing Opens Pandora's Box
With the unlimited potential for creating objects allowed by 3D printing, the ability to blaze new paths, as well as copy existing products. However, both the creation of original objects and copying of existing objects pose risks to the 3D printing industry. For purposes of brevity, this article will just deal with the topic that went mainstream in the last 72 hours: the ability to print 3D guns that work.
It was widely documented previously that the potential to compile the plastic pieces needed to assemble a gun using a 3D printer hypothetically could happen. As recently as January 2013, a company dedicated to hosting the blueprints or CAD type files for creating 3D objects pulled all files related to gun parts. That will not, and has not stopped, others from continuing to attempt to create a usable gun using a 3D printer. Now, it appears one man has succeeded and plans on releasing the blueprints on the internet, so that anyone who wants them will be able to do just as he has. This is a game changer.
The question becomes what will happen next. The answer is legislation, outrage from concerned citizens, questions from authorities, and ultimately it will all be aimed at the companies that make 3D printers. You will not be able to stop those who have the capability to create a weapon using a 3D printer. The only way to stop this will be to attempt to regulate the industry. One way or another, there will be a cost involved for the 3D printer manufacturers.
The ultimate cost will come when someone creates a gun, or any other object, that is used to cause harm or damage. Those who are damaged will not look to sue the individual who created the design or created the object used to inflict damage. They will attack the deep pockets, which in this case will belong to the company that manufactured the 3D printer.
Many will probably scoff at the notion that the 3D printing companies could be liable if someone were to print a gun and then use it to harm another person. Those same people would argue that if this liability were to exist, then every gun manufacturer would already be out of business. The reality is that, until recently, it was a very real possibility for gun manufacturers to be sued when their weapons were used in a crime. There were lawsuits and settlements paid by the gun manufacturers associated with the Washington D.C. sniper case just in the past 10 years. However, the difference between gun manufacturers and 3D printers is night and day. The reason is the clout of the National Rifle Association "NRA" and legislation that now exists specifically to protect gun manufacturers. The passion for guns and the special interest money existed to create this legislation. There is not a chance that the same passion or money exists to protect 3D printer manufacturers.
The capabilities of 3D printers are almost breathtaking. The various fields of use are endless. The companies at the forefront of this revolution, such as 3D Printing and Stratasys have equally endless potential to profit from the products they make. However, until I have clarity on how these companies and lawmakers intend to deal with the inevitable criminal use of the products I would hesitate to invest in either of these companies. The risk of debilitating restrictions on sales, as well as liabilities arising from acts such as gun violence tied to 3D printing, leave me more than a little concerned about what I would be investing in.