This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

'Making' Is the Biggest Tech Merger Ever

NEW YORK ( TheStreet) -- Technologies merge all the time. Clouds are a merger of distributed computing and virtualization. Tablets are a merger of laptops and phones.

But there are bigger technology mergers on the horizon in this decade. The biggest may be the coming merger of computing with manufacturing.

Chris Anderson , perhaps the best tech writer of my generation, recently quit the scene to join a start-up, 3D Robotics , which he told The Atlantic is at the center of all this. He calls it a "natural outgrowth" of the "maker" movement he began covering five years ago.

For investors, that movement may be a mystery, but it's simply this: Instead of producing virtual goods from computers, makers produce real goods. "Making" is where personal computing itself was 40 years ago, a hobbyist niche looking to become a mass movement.

Think of 3-D printers as being the computers of this new movement. Companies including 3D Systems (DDD - Get Report) and Stratasys (SSYS - Get Report) are what Intel (INTC - Get Report)and Texas Instruments (TXN - Get Report) were at that time, and their printers are at roughly where the Intel 4004 chip was then . Their best printers are capable of creating dental implants from wax molds or aeronautics parts from metals.

Hewlett-Packard (HPQ - Get Report) had a private labeling deal with Stratasys but ended it amid speculation it would get into this business on its own.

General Electric (GE - Get Report) recently bought two high-end 3-D printing outfits, Morris Technologies and RQM, through its aviation unit, as 3Ders, which you might call the Datamation magazine of this field, recently reported.

Both 3D Systems and Stratasys have been great investments over the last few years.

There are short-term worries about 3D Systems , Seeking Alpha writes, which is increasingly going to court to protect its niche. Those will work themselves out.

The uptrend in Stratasys seems more secure, as it seems to have a better handle on differences between the prototyping and production areas of the business, but both companies should do well.

The real excitement is on the low end, with start-ups like MakerBot , which is based in Brooklyn, N.Y. The company deliberately focuses on the consumer market, producing both hardware and software, encouraging the growth of the hobbyist market and doing demonstrations such as a 3-D "photo booth" that produces small sculptures of your head from a photograph.

Its Replicator 2 can turn plastic filament into finely detailed parts for about $2,200.

Think of these, however, as being like HP calculators back in the day. They're cool, and if you're a college student or an engineer you're going to be jazzed. Events like the Maker Faire have the vibe of the old West Coast Computer Faires from the 1970s, complete with young long-haired geeks speaking a language their parents don't understand.

It's from this cohort that the big breakthrough will come. We're still awaiting the Apple II or the Radio Shack TRS-80 of the maker revolution. Something and someone, in the next few years, is going to transform 3-D printing from a niche market into a mass market, into something every business has to have in-house and every family will want to own. Vast new markets in software, materials and products will result from that.

What Anderson's adventure is pointing to, however, is something even bigger. That is, the merger of making with motors. 3D Robotics is in the business of build-your-own drones , smaller versions of the war machines that have transformed the war against al-Qaeda from a defensive struggle to an offensive one.

But that's just the tip of the iceberg. Where it all leads is unknown, and that's the most exciting place for any business to be, at the bleeding edge. It's enough to make a great writer put down his pen.

At the time of publication, the author had positions in INTC and GE.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
DDD $17.69 0.00%
GE $30.75 0.00%
HPQ $12.27 0.00%
INTC $30.28 0.00%
SSYS $24.47 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs