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3D Systems to Acquire Digital PlaySpace

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After a series of acquisitions, strategic partnerships and lower preliminary results, 3D Systems Corp. (DDD - Free Report) is back in news for its decision to acquire Digital PlaySpace, a proprietary, innovative and immersive digital play platform that connects brands, retailers and consumers to 3D printable play activities. The financial details of the transaction were not disclosed.

Through this acquisition, both the companies intend to offer a unique experience for children as well as parents by enabling them to create a prototype of the digital Dollhouse or the Dreamhouse that they have created using the digital play platform.

Digital PlaySpace is essentially a game design and development studio that offers a portal that creates engaging play across multiple platforms. The company has two offerings under its platform. The first is Digital Dollhouse, a virtual dollhouse where one can create ones Victorian or modern Beachhouse by decorating photo-realistic 3D dollhouses with a range of items from wallpapers and paint to furniture and accessories. Digital Dollhouse was launched in 2008 and has over 6 million virtual rooms created to date.

The Dreamhouse Designer on Facebook is a similar concept, which allows players to become virtual designers and create multiple types of rooms by pulling in items from all over the Web and sharing them with friends and family.

3D Systems and Digital PlaySpace intend to make this possible through Cubify – the digital portal of the former for all things 3D. It can be termed as a virtual shop for the best 3D printed goods, design with apps and tutorials on 3D printing at home. It’s a place where 3D printing turns ideas into real objects. A customer can create own designs and print on the Cube or CubeX 3D printers or have the company printed.

Increasingly, designing and 3D printing technology as per individual preferences are expected to gain popularity, moving forward. This technology has a presence in almost every field such as manufacturing toys and candies, consumer products and electronics, automotives, home décor, MedTech and jewelry among others.

The greater adoption of 3D printing technology is also being supported by IDC’s growth estimates for the worldwide 3D printer market. The research firm expects 3D printing revenues and units to grow at a CAGR of 29% and 59%, respectively, for the 2012–2017 period. Further, IDTechEx Market Research estimates the market for printed electronics (under $5 billion in 2012) to grow rapidly to $35 billion in 2020 and an astounding $300 billion by 2030.

Moreover, according to Taiwan Industrial Economics and Knowledge Research Center (IEK), the global 3D printer market will reach 100K units in 2014, and increase to approximately 6 million units by 2018.

These estimates are a positive for 3D Systems as it is a leading provider of 3D printing design-to-manufacturing solutions including 3D printers, print materials and cloud-sourced on-demand custom parts for professionals and consumers. The company’s solutions currently work on materials like plastics, metals, ceramics and edibles.

3D Systems expects that its portfolio of new and innovative products to lead to more than 30% organic growth in the next couple of years, thereby enhancing its margins and earnings.

Moreover, synergies from the recent acquisitions and recent collaborations with Hasbro (HAS - Free Report) and The Hershey Co. (HSY - Free Report) are added positives for the company. In addition, the company’s innovation in the medical products market was commendable. On Feb 18, 3D Systems had printed a hybrid Exoskeleton robotic suit by partnering Ekso Bionics, a robotic exoskeleton company. The 3D printed Ekso-Suit was made for a patient who was paralyzed from waist down after a skiing accident.  

3D Systems currently has a Zacks Rank #3 (Hold). Other better ranked stock includes Hewlett-Packard (HPQ - Free Report) having a Zacks Rank #2 (Buy). 

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