CAD/CAM market buys into PLM

Cambridge, Massachusetts – Spending on PLM (product lifecycle management) software and services -- mechanical design and management of the generated data -- is growing at around 8% year-on-year and on track to reach $13.4 billion in 2007. The market is attracting “strong investment by large and small enterprises in technologies that foster innovation,” US-based market research firm Daratech Inc. said 24 April.

Last year saw major restructuring in the PLM market, with ANSYS the no. 2 and no. 3 player in the CAE and CFD markets, respectively -- buying Fluent, the CFD market leader. Dassault Systemes strengthened its second place the PDM market with its acquisition of MatrixOne, while Autodesk bought Alias. Altair Engineering bought Mecalog and PTC bought Mathsoft -- among a series of other acquisitions.

Managements at the acquiring companies now face challenges in integrating the new businesses, which can impact sales as clients wait to see what will happen to their favorite products and staff, noted Daratech. Overall, it said, “these acquisitions also caused market growth to slow where no real slowdown is evident: US accounting rules require acquiring companies to write off part of the deferred revenue that had been on the books of the acquired companies.”

Even so, Daratech rates 2006 as a “good year.” The PLM market as a whole, grew around 8% over 2005 to reach $12.3 billion. Buyers, it said, “understand the need for and benefits of what was traditionally called CAD/CAM, adding significant analytical and advanced visualisation component even at the designer level.”

Daratech went on to forecast a 12% compounded annual growth rate for 2007 to 2010, due to “a high adoption rate of new users and thanks to new functionalities for which consumers will be willing to pay a premium.”