Still interested in SSYS as a potential investment. But I don't yet understand what their moat really is. It seems like there are a whole bunch of companies out there in the 3D printing space (not just SSYS and DDD). And SSYS may have a leading market share right now....and a first mover advantage. But what do they have that really amounts to a moat? Is there some part of the business that they own and have enough IP that others can't enter it? OR are there high switching costs that can be maintained over time?I spent some time investing in fiber optics companies right as they were taking off during the first internet boom. I learned the hard way that market share and first mover advantages do not automatically mean you have a moat.Again, I'm not pretending to be an expert. Just want to get some responses.Cheers,J
My guess is that these companies invest in specific material development for specific applications and that makes them leader in those applications. It's likely that you have to use the material supplied by same company to build product effectively. Although this advantage may go away later, at-least in the begining, such razor/blade model is feasible. (fiber optics didn't have razor/blade to my understanding).I have cursorily read about it but not really researched to find out if this can be counted into moat. This is just a guess. I am am interested in learning if the 3D design tool would have ability to build moat. I can't think of any company other than AutoDesk for such CAD tools. It seems like that space is also in early phase and not many public companies in the space.
Well, here is a good example of the bear case:http://www.fool.com/investing/general/2012/07/10/save-yourse...if there is no moat, then commiditization is a problem.Also if open-source is an actual competitor- then I would also say there isn't much of a moat.For me, I only invested in SSYS because want to be investing in the high cost/high margin. I have no hard numbers on this, but I get the sense DDD is going more for home/small business, while SSYS is targeting more large busuiness.I believe the home/small business will be under pressure from cheap/ open-source options.but I can always be wrong.alexapbalong SSYS
DDD has bought a lot of companies. Maybe patents are the moat.Just speculation.
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