CIMdata Reports cPDm Market Undergoes Explosive 62% Growth to Exceed $2.8 Billion in 2000

    ANN ARBOR, Mich.--March 1, 2001--According to figures released today from consulting and research firm CIMdata, Inc., the worldwide collaborative Product Definition management (cPDm) market grew 62% to reach $2.86 billion in 2000. Investments in software jumped to $1.23 billion, comprising 43% of the total market and exceeding the growth rate for service revenue for the first time in years.
    CIMdata forecasts overall cPDm investments to continue at a significant pace over the next five years. The firm predicts the market will exceed $4 billion in 2001 and increase at a compound annual growth rate of 43% through the year 2005, when they expect the market size to exceed $13 billion.
    Exceptionally strong growth in 2000 is attributed to widespread adoption of cPDm as a way for companies to operate more effectively in increasingly competitive global markets. A significant driver has been the adoption and implementation of e-business strategies across the manufacturing enterprise. "Clearly, the cPDm industry has reached a major turning point in its acceptance and demand, with industrial organizations worldwide committing record levels of investment," says Ed Miller, president of CIMdata.
    "Organizations and their executives today have a well-founded sense of urgency in realizing that business approaches and work processes absolutely must be changed to maintain market strength, especially in today's volatile economy," explains Miller. "Companies must develop and deploy effective integration of both their physical, and intellectual supply chains. Those operating as they have in the past run the risk of being overtaken by agile, more aggressive competitors, across town and around the world."
    According to Miller, there is a growing awareness that product innovation is a critical element of competitive differentiation - embracing improvements in time-to-market, quality, collaboration, and cost management. This recognition is fueling investments in collaborative product innovation and visualization-focused initiatives - the heart of cPDm, which is a primary enabler for collaborative commerce.
    "For an increasing number of companies, the key to achieving such improvement is cPDm, a strategic business approach to collaboratively manage the product definition lifecycle across the extended enterprise," explains Miller. He noted that cPDm is provided through a combination of best-practices processes and a full suite of technologies such as product data management, collaboration, visualization, collaborative product commerce, enterprise applications integration, components supplier management, and others.
    "In this way, cPDm enhances the business performance of the enterprise by supporting initiatives such as supply chain management, concurrent engineering, integrated product development, design collaboration, and globalization: initiatives that can make or break a company," Miller says. "Because it enables businesses to bring innovative and profitable products to market effectively, cPDm and the collaborative capabilities it provides are rapidly transitioning from a competitive advantage to competitive necessity. With so much at stake, companies are implementing cPDm in record numbers."
    Miller says that because of these business drivers, the core market is experiencing tremendous expansion as cPDm programs become mainstream and are targeted as enterprise-wide initiatives. Additionally, the continually expanding and overlapping scope of related technologies offers companies a broader array of capabilities to address their problems.

    Diverse Market Sectors

    "A wide range of vendors supply cPDm-related software and services," explains Ken Amann, CIMdata Director of Research. "The overall cPDm market has different sub-segments, each with its own set of technology suppliers, many of which do not directly compete but rather complement one another."
    According to Amann, the overall market is comprised of four major sectors: comprehensive cPDm technology suppliers, visualization/collaboration vendors, system integrators/resellers/VARs, and specialized application providers.
    Comprehensive cPDm technology suppliers (e.g., SDRC, PTC, MatrixOne, SAP, etc.) comprise 48% of the market and had significant revenue growth in 2000. "Increased investments are fueled by the expanding scope of enterprise-wide implementations, readily scalable base technologies, the proliferation of web-based technologies, newer visualization/collaboration technologies that enable value to be achieved quickly, and the development of Internet portal exchanges," explained Amann. "The growth of supplier developed "packaged solutions" focused on specific industry problems enabled sales and implementations to be completed at a much faster pace."
    Visualization/collaboration suppliers (e.g., EAI subsidiary of UGS, Centric, CoCreate, Cimmetry, etc.) saw impressive growth in 2000 as these technologies matured and companies began to recognize their tremendous potential in improving process efficiency in engineering organizations. Although this sector generated only 7% of the overall market, suppliers are poised for explosive growth over the next few years and are clearly a driving force in the acceptance and value of overall cPDm initiatives.
    Systems integrators/resellers/VARs (e.g., Accenture, PricewaterhouseCoopers, EDS, etc.) comprised 30% of market investments in 2000 and experienced major growth as both the scope and pace of implementations expanded dramatically. Demand for implementation services outgrew the ability of the technology suppliers to deliver, and the major service suppliers are filling that role. "These suppliers are having a huge impact on the market, with most of the major firms establishing focused programs to address cPDm opportunities that complement and expand their e-business/strategy, supply chain management, and collaboration initiatives," stated Amann.
    Specialized application suppliers (e.g., i2, Documentum, and others) accounted for 15% of cPDm investments as these vendors -- most notably those focused on Customer Supplier Management (CSM), Supplier Relationship Management (SRM), and document management -- have begun to acquire and integrate core cPDm technology into their overall product suites. This trend will likely continue, with these vendors (some quite large) focusing increasing portions of their business on the cPDm market.

    Vendor Rankings

    According to CIMdata revenue statistics compiled for 2000, the market leader among the top ten comprehensive cPDm technology suppliers is SAP followed by PTC, SDRC, IBM (Enovia), UGS (including EAI), MatrixOne, Intergraph, Ariba (including Agile), NEC, and Eigner+Partner.
    Many of the suppliers provide technologies through their own field sales and support organizations. Others also heavily leverage system integrators, resellers, and other partners for additional sales. These combined core and partner revenues greatly expand the visibility and impact of these suppliers on the industry, generating a significant market presence for these major suppliers. Based on these combined revenues, CIMdata statistics indicate that the vendor with the greatest "cPDm market presence" is SDRC, followed by SAP, MatrixOne, PTC, UGS, IBM, Intergraph, Ariba Agile, Eigner+Partner, and Smart Solutions.

    Activities of the Major Players

    Vendors in the list of top ten comprehensive cPDm technology suppliers and leading market presence suppliers maintain their strong market positions through numerous continuing efforts and strategies that are quite different for each company.
    SAP achieved the top spot among comprehensive cPDm technology suppliers by generating over $220M in direct revenues. This dramatic accomplishment was achieved almost quietly, with most of their implementations launched as extensions of SAP's enormous customer base and thus requiring no significant competitive benchmarking. Also, SAP is one of the few suppliers generating significant revenues in both the discrete manufacturing and process industries, with overall revenues larger than either specific industry group would immediately recognize. A major portion of SAP revenue derives from central Europe where they hold a dominant market position. However, their growth in other major regions is accelerating, especially in North America, and the firm is leveraging existing relationships with major system integrators to continue expansion of cPDm business within its customer base.
    SDRC maintained the leading position in overall market presence based on the total revenue that they and their partners create in the industry. Their existing customer base is substantial and includes some of the world's largest corporations. As these implementations have been expanded (with the help of many systems integrators and SDRC partners) investments around the world in the "Metaphase economy" have expanded significantly, totaling almost $365M in 2000.
    PTC continues to show major growth in their Windchill program, with impressive revenue growth in both software and services, where they ranked number two in both categories. Their impact on the market, and their overall visibility, are tremendous. Through their market activities, they are playing a major role in educating the industry and increasing cPDm business for themselves as well as their competitors.
    MatrixOne demonstrated overall impressive growth, jumping to the number three spot in market presence and number four in software revenues during 2000. Their market presence and visibility are greater than their company revenues indicate, as they have effectively leveraged partners and systems integrators to generate a substantial economy built on their technologies.
    UGS is still a relatively "quiet" competitor as they continue to expand their business. Historically a significant portion of growth came from within their existing CAD/CAM customer base, but they are gradually becoming more visible in the "open" market. Their acquisition of EAI boosted total revenue numbers for 2000, placing them number five in both market presence and overall revenues, and number three for software revenues.
    IBM's growth continued, with much of the increase achieved by leveraging their existing CAD/CAM customer base. Additionally, they are one of the largest suppliers of services among the major technology suppliers. They are ranked fourth in overall revenue among the comprehensive cPDm technology suppliers.
    Intergraph is a major supplier to the process industries and holds a dominant position in the process and plant sectors. Among the top ten overall suppliers worldwide, they are the only one to totally focus on the process industries.
    Ariba- Agile is one of the real success stories of the industry. Their clear focus on a primary market sector enabled them to differentiate themselves and expand their business significantly. Their market presence has been visible for the last three years and in 2000 they generated enough revenues to break into the list of top ten revenue generators.
    NEC has been a major force in the Japanese market for the last few years and continues to expand their business presence. They finished 2000 ranked ninth in total revenues among comprehensive cPDm technology suppliers.
    Eigner+Partner has developed business beyond the original home location of Germany, and is beginning to establish a presence in North America as well. In 2000, they are ranked tenth in revenues and eighth in market presence based on their strong relationships with key partners.
    Smart Solutions has shown impressive growth in both revenues and market presence over the last year. They provide their technologies primarily through partners, and gained a spot in the top ten of the overall market presence for the first time in 2000.

    Expanded Market Service

    Additional information on the cPDm market is available through CIMdata's Market Service covering the latest trends, events, and issues surrounding the rapidly changing industry. Subscribers receive periodic reports analyzing cPDm market events and trends, a monthly industry news compilation, daily late-breaking industry news, a comprehensive Market Opportunities Analysis with revenue and sales statistics, access to teleconferences discussing issues and events relevant to the market, and a level of telephone support.
    A longer version of this press release complete with graphs and more details on market statistics is available at www.CIMdata.com

    April Industry Conference

    Information on the cPDm market, technology, and applications will be presented at the CIMdata 2001 annual conference "Solutions and Strategies for Collaborative Engineering through the Supply Chain" April 3-5 in Palm Springs, California. The event is the world's largest exposition totally focused on managing the full product definition lifecycle in the extended enterprise. More than 1,200 delegates are expected to attend, and over 35 suppliers will demonstrate solutions in an exhibit hall and schedule meetings in private suites.
    The keynote address by Kirk Gutmann, Global Develop Product Information Officer at General Motors, will focus on the impact of e-business at automotive companies. User presentations, tutorial sessions, industry panels, and discussion groups will focus on product data management (PDM), collaborative Product Definition management (cPDm), B2B initiatives, collaborative design and manufacturing, collaborative product commerce, integrated product development, eBusiness globalization, digital manufacturing, and product maintenance management.
    A panel discussion devoted to supply chain collaboration in the automotive industry brings together OEMs, suppliers, technology providers, and industry consultants to discuss PDM interoperability, design collaboration, the Covisint e-business exchange portal, and go over case studies from companies in the automotive supply chain.
    Cost is $995 for the two-day conference and an additional $400 for the one-day tutorials. Exhibits only and group rates are available. Contact CIMdata at 3909 Research Park Drive, Ann Arbor, MI 48108, U.S.A. Tel: +1 (734) 668-9922. Fax: +1 (734) 668-1957. Or visit the CIMdata website: www.CIMdata.com.

    About CIMdata

    CIMdata helps companies develop innovative and profitable products in the evolving global e-business environment. The company accomplishes this through its worldwide strategic consulting services and in-depth research, targeted for industrial organizations and suppliers of technologies and services.
    CIMdata provides world-class knowledge and expertise on the use of collaborative Product Definition management (cPDm) solutions that utilize best-practice methods, and related technologies. These include product data management (PDM), visualization, collaboration, collaborative product commerce (CPC), document management, component supplier management (CSM), configuration management (CM), software configuration management (SCM), enterprise application integration (EAI), computer-aided design/manufacturing, and numerical control (NC).
    In addition to consulting, CIMdata provides industry education through international conferences in the U.S., Europe, and Japan, which focus on management of the product or plant definition lifecycle. The company also conducts focused research and produces several commercial publications. CIMdata serves clients worldwide from locations in North America, Europe, and the Pacific Rim.
    For more information, contact CIMdata at 3909 Research Park Drive, Ann Arbor, MI 48108, U.S.A. Tel: +1(734) 668-9922. Fax: +1(734) 668-1957. Or visit the CIMdata website: www.CIMdata.com