Some random thoughts on a summer day

Continuing to reflect market response to laser trends

The mini-business of publishing reports on the global industrial laser materials processing market seems to be growing, as more market research companies are attracted to the industry. Industrial Laser Solutions and our sister Strategies Unlimited are also participants, one for a fee (SU) and the other for free (ILS). Not to claim grandfather rights, but ILS—then called Industrial Laser Review—was first in 1985. That year, we estimated the market for industrial lasers to be about $106 million; today, we estimate $2,631 million for an unadjusted inflation compound annual growth rate (CAGR) of about 4.7%.

ILS—unlike a half-dozen widely advertised reports—did not and still doesn't project revenues beyond the next year. We leave that to the professional market research organizations that have their own methods of measuring market activity. I raise this only because some current reports suggest the market revenues will grow over 6% CAGR through 2020—about the same as projected global machine tool growth. So, two thoughts: industrial laser revenues now appear to be tracking machine tool revenue growth rates (a point we have been making for the past few years) and laser growth does not appear to be a function of deeper penetration into markets now held by machine tools; rather, the laser suppliers are finding new markets to feed revenue growth. Case in point-laser additive manufacturing (3D printing).

Another summer-day thought relates to editorial content in ILS. Over the three years ending this December, ILS will have published specific laser-related editorial as follows: CO2 lasers – 26%, fiber lasers – 30%, solid-state lasers – 35%, and other lasers (mostly diode) – 9%. These percentages do not include editorial that covered more than one laser type; for example, precision processing of medical devices being served by both solid-state and fiber lasers.

I had reason to do this review because some feedback suggested that ILS seemed to be shifting more toward fiber laser processing than in the past. There is some truth in this because our editorial philosophy has been to reflect the market response to laser trends. The market revenue numbers in the three-year period support the vigorous growth of fiber lasers, often at the expense of the other laser types. Thus, we apportion editorial space that reflects this market feedback.

What wasn't a surprise was the stronger position allotted to solid-state lasers, dominated by ultrafast lasers for micromachining. I believe, as do the authors of all these papers focusing on microprocessing, that this will be the growth application for the next few years, as the technical benefits of the process closely match the needs of companies sizing production demand for manufacturing in the near future.

My last thought on a warm day at the lake—have you noticed the increased filing of intellectual property regarding laser processing from Chinese companies? Starting in January, my daily LexisNexis reports have typically had several notations of recent filings. Looks like these companies are reacting to suggestions made by central government that they establish IP rights to allow them to compete globally. They make interesting reading, as they sort of give clues as to where these companies plan to compete.

David A. Belforte
belforte@pennwell.com

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