PLM Cloud Interest and AAA PLM Players

The interest to cloud PLM is growing these days. At the beginning of this year, I discussed future PLM business model during the PLM Innovation conference in Munich. You can navigate to my historical post here. You can see lots of conversations about cloud these days. However, until now, only one from major PLM players – Dassault, was playing cloud game. As it was mentioned by Bernard Charles during DSCC 2011 event, Dassault invested 2B into building of the unique online cloud platform. This is not true any more. Earlier last week, Siemens PLM announced the availability of TeamCenter on the cloud. Navigate here to read Siemens PLM announcement. According to Siemens PLM:

Teamcenter on the cloud enables companies to move some, or all, of their computing infrastructure to a third-party cloud service provider versus investing in their own hardware. This gives customers cost effective access to enterprise grade IT infrastructure and resources without the need for capital expenditure. Siemens now supports Teamcenter on three of the leading cloud services, Microsoft Windows Azure, IBM SmartCloud™ Enterprise+ and Amazon Web Services. The company has completed a certification and enablement program for Teamcenter delivered on each of these service provider’s IaaS offerings.

I found an interesting writeup about TeamCenter on the cloud made by PJ of TEC. Navigate to this link to read -Siemens Teamcenter Going to the PLM Cloud. PJ is analyzing what is behind TeamCenter cloud announcement. This is an important passage, in my view, which explains that:

While the benefits such as faster time to value, dynamic scalability, and lower TCO are indisputable, this is just the typical first cloud-enabling step of moving the infrastructure to the cloud. Certainly, there is also the benefit from accessing the PLM system from the Internet, and at the analyst event, we also saw a demo of a mobile user interface (UI) in the cloud. But our understanding was that Siemens is not yet going to provide a subscription model or a multitenant cloud.

At the same time, PJ concludes that despite cloud announcement, TeamCenter is not adopting ‘cloud PLM’ business by moving towards subscription model. I didn’t find any mentioning of subscription prices as well as information about future announcement. Siemens PLM press release mentioned only “business flexibility”, as was mentioned by TeamCenter cheif Eric Sterling. Here is the quote:

“The key benefit of Teamcenter on the cloud is the business flexibility it provides,” said Eric Sterling, Senior Vice President, Lifecycle Collaboration Software, Siemens PLM Software. “In today’s ever changing global landscape, the flexibility to dynamically manage infrastructure on the cloud gives customers the ability to scale up computing resources with demand and more importantly, scale down costs if demand decreases. This enables organizations to effectively manage IT budgets as an operating expense versus capital expense which can improve profitability.

AAA PLM?

I learned an interesting term in PJ’s article – “Triple A” PLM players. As I mentioned in my earlier article, Open Source and subscription-based model used by cloud PLM apps are two major PLM business disruption forces. PJ summarized it by calling three vendors – Aras, Arena Solutions and Autodesk PLM (AAA):

Siemens acknowledged that its main interest is still the perpetual license play. The vendor admitted that the so-called Triple A PLM players—Arena Solutions, Aras Corp., and Autodesk 360 PLM— are disruptive forces in terms of PLM deployment and licensing. Siemens pledged to be responsive to the market—i.e., it is constantly reviewing its practices—but everything needs to be good for both the vendor and its customers. Term-based licenses and Siemens Finance Services were suggested as possible options in the meantime.

PLM cloud awareness

I usually do my “reality check” on Google trends. You can see that now “PLM cloud” is now a visible trend. At least, you can see it on Google’s trends, which confirms the growing cloud interest from players and customers in engineering and manufacturing space. Even it is not saying much to prove the adoption and customer experience with cloud PLM, it is a confirmation of the trend and strategic direction.

plm-cloud-google-trend.png

What about PTC / Windchill?

After TeamCenter cloud announcement, PTC Windchill is the only product (vendor) that didn’t refresh their interest in a cloud PLM play. Windchill has long time an agreement with IBM about hosting of Windchill on IBM servers. You can see this offering is available here, but I PTC didn’t provide any recent updates about that offering as well as a preview about future availability of Windchill on the cloud. You can only see IBM application on demand delivery model here.

What is my conclusion? In my view, customers are starting to recognize the value of the cloud technologies for PLM. It comes in multiple aspects – IT infrastructure optimization, business models allowing to pay for services as you need them, global access and many others. It would be interesting to see how cloud technologies and product offering will be developed by PLM vendors in coming years.

Best, Oleg

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2 Responses to PLM Cloud Interest and AAA PLM Players

  1. Oleg,

    Interesting comments from Siemens about allowing flexibility for IT scale up and down. “In today’s ever changing global landscape, the flexibility to dynamically manage infrastructure on the cloud gives customers the ability to scale up computing resources with demand and more importantly, scale down costs if demand decreases.”

    So lets all cheer for IT scale and total cost of ownership! So does this intellectual model also apply to the licenses you bought when PLM deploys more slowly, you reduce the supply base or you decide to reduce a project or two? Not so fast and simple…..

    I can’t wait until the BBB players (Big Budget Burden) wake up and realize that if they can open the business model and offer solutions that can scale rapidly across the enterprise technically and from a business perspective the value of PLM might actually take off and positively impact US GDP.

    Good to see you last week and for full disclosure I’m not kissing up to Autodesk with this post!

  2. @David, I think, Siemens was stressed to provide an answer to “cloud strategy” question. So, IaaS announcement about TeamCenter was born :). Let see if somebody from Siemens will comment on that… Best, Oleg

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