PTC held their annual media and analyst day on the day “Snowmaggedon” was supposed to hit the Boston area. It amounted to not much of anything but did keep a few participants and a speaker or two away, and sent several people scurrying by mid-afternoon. Those of us who stuck it out heard PTC’s vision for its future and the future of PLM — and, not surprisingly, how PTC sees itself square in the lead.
COO Jim Heppelmann started things off, saying that "it feels like what’s happening at PTC isn’t happening across the PLM industry,” referring to the fact that PTC reported 137% license growth in its PLM offerings in the December quarter while it expected DS to report a decline (as did indeed happen after PTC’s remarks were made). Neither Heppelmann nor CFO Neil Moses mentioned that this growth was on top of a number that had declined 25% the prior year and so was an easy comparison — but it’s still an impressive number given general IT spending trends in 2009.
What was compelling about Heppelmann’s story (and it was a narrative that was woven through the day) is that PTC is seeking a PLM leadership position on a number of fronts, not just financial. Each facet is a dig at a specific competitor: financial leadership was aimed at Dassault Systemes, technology leadership (defined as having the “broadest capabilities on a superior architecture”) at DS’ ENOVIA and Siemens PLM’s Teamcenter, thought leadership (“ahead of the curve at anticipating needs”) at DS and Siemens, and value leadership (“masters at helping customers realize value”) at Autodesk.
Competitor-bashing is a favorite sport at these events, but PTC did actually have a compelling story of its own to tell, led by the fact that the customers buying Windchill are not necessarily Pro/E users. In fact, the domino account strategy targets companies whose revenues exceed $10 billion in target verticals (industrial, high tech/electronics, aerospace, automotive, life sciences, retail/consumer) and who are not current PTC customers. The interesting part of this is that it’s a great strategy on two fronts: a domino account contributes a relatively modest amount to revenue in year1 but then is an annuity (recurring revenue) for years after. From a marketing perspective, each domino win is an endorsement of PTC’s strategy and induces other companies, perhaps in the domino’s supply chain, to consider a Windchill implementation.
On the thought-leadership front, PTC spoke about a number of recent and forthcoming releases that do seem to better integrate PTC’s disparate platforms. This is not a comprehensive list, but what I found most interesting:
• PTC is taking green very seriously, with the acquisition of InSight and Planet Metrics, creating ways in which designers can assess the impact of design changes, do trade-off studies, and test assumptions around substitute materials, packaging, suppliers and the like. No demo, but a very good PowerPoint!
• The strategy for managing products’ embedded software inside PLM relies heavily on open-source products that PTC will help to improve. To highlight the importance of softare in today’s “mechanical” devices, PTC’s Chad Hawkins told us that an unnamed automobile company has 3,000 mechanical and 3,000 electrical engineering — but 12,000 software engineers to support a typical “premium” car with 100,000,000 lines of code. PTC plans to build its “Application Lifecycle Management” solution on the most widely-used open source tools (Bugzilla, Eclipse, Subversion), integrated under the Windchill umbrella.
• PTC appears to be combining Arbortext and Isodraw into a web-based mechanism to deliver lightweight 3D visualizations for technical manuals. It’s strategy around “service information”, supporting a "bill of service" that is tied to design and manufacturing data, has shown solid ROI for customer Komatsu, and should be very attractive to many other companies.
• ProductPoint (a Windchill-based data management and collaboration offering on Microsoft SharePoint) seems to be doing very well. In the year since its release, ProductPoint has been sold into 130 companies; the goal for this year is 300. It’s not yet an important revenue component because it’s being sold into small/medium-sized companies in small installations, but PTC sees it as having the potential to penetrate into the SolidWorks user community with release 2.0.
Completely missing from the day until the audience asked during the Q&A session, was mention of the vast array of MCAx-y products also sold by PTC. It turns out that there will be new releases for all brands, with the most interesting new developments being
• CoCreate 17.0, focusing on usability
• a new release of Arbortext, with 3D publishing and more links to Windchill
• two new releases of Mathcad, the next release in traditional stream plus the first release of a redesigned product named Mathcad Prime
• a new CADDS release for the shipbuilding vertical.
(I’m sure there’s a planned release of Wildfire in there somewhere, but it didn’t come up during PTC’s PLM-centric day.) Of course, I wish there had been more MCAx, but, as COO Heppelmann said, paraphrased, when asked about CAE: "Our PLM business is on fire – why spend time talking about anything else?"
In all, it was a fascinating day. PTC’s swagger is back — if it ever was truly gone. It may actually be deserved this time, if there products “shown” (again, all in PowerPoint at the media day, so YMMV) deliver on their promises.
Updated to add: PTC did provide coffee, lunch and tchotchkes to all meeting attendees but did not compensate Schnitger Corp. for the contents of this blog. Still getting used to this rule.