3D Service Provider Consolidation

nvidiaThanks to Ken Smerz and Michael Raphael for the tip on this interesting article that attempts to make a case for consolidating the 3D laser scanning service providers in the U.S. I was approached about 6 months ago by a group that claimed they were going to make this happen, but it seems to have fallen apart.

The author, Jon Ritter has done a lot of thinking about this business model. I like his organization of companies into four primary service areas:  architectural scanning, industrial part scanning, film/VFX/games-based modeling and architectural heritage. He thought the national scale entity should focus on AEC and industrial parts or metrology.

Jon commented that, “Consolidation should take place because it would be an engine for growth based on the cost efficiency and the breadth of service offerings that a larger, better funded organization with deeper resources can bring to its customers.” We have recently seen this approach occur in the airborne lidar market with the results not being that positive.”

He notes, “The challenge when working with privately held companies is that you can’t just pull up some public filing and analyze their numbers. What we ultimately concluded was that in order to roll up enough scanning companies for the plan to make sense from a venture capital perspective, we would need too many companies.”

He concludes, “In addition, rather than a single set of transactions to consolidate top companies in the industry, I suspect that a more organic approach over time may ultimately be what occurs.”

It’s a well written and thought out analysis, but I have to question whether a large, national entity would be able to provide the high level of customer service offered by today’s smaller, highly responsive service providers.

What might be of greater value to the industry is a trade association that educates the public, provides standards, certifications and national scale marketing.

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