|
upFront.eZine |
|
|
a
publication from |
|
|
Issue #590 : : February 3, 2009 |
|
|
In this issue:
Readers Respond: The Dream of a Low-Cost Provider
|
Write the editor. Make him smile! Through Paypal, consider donating $25 in support of upFront.eZine. Or else... We're trendy. We have a Weblog. WorldCAD Access. |
|
|
|
|
PTC is the first CAD vendor to report each quarter on its business, and so becomes the canary for the coal mine in which we all labor. The company took a 25% hit on its share price when it earlier warned that revenues would be flat. To be punished so much for maintaining sales in this time of difficulty! This being times of difficulty, PTC went straight in its quarterly conference call with financial analysts to Q&A -- doing without the mind-numbing preamble in which company CEOs and CTOs read through the quarter's financial statistics.
Q&A On the $5 million drop in maintenance [subscription] revenue: that's mainly due to "currency headwind" [strengthening of the US dollar]; revenue is actually up 4%. Some 915,000 seats on maintenance. On the channel [reseller] business: up 6% without CoCreate, up 4% with CoCreate. On the difference with Autodesk, where one analyst expects greater maintenance attrition: Pro/E has perpetual seats + maintenance, whereas Autodesk sells seats and largely sells upgrades, which is very easy to opt out of for another year. On the negative incentive customers have to keep paying for maintenance: "A customer can't cancel maintenance now and start it up again two quarters down the road. We don't allow that. If you stop maintenance, you're off the train. The only way to get back on the train is to re-buy the software. So then they're in a situation of having to pay essentially five times the price to re-buy the software and then get back on maintenance again so this problem doesn't re-occur." On customers asking for lower maintenance fees: they're asking, and we're resisting. On giving more liberal financing: we're testing 0% financing, as well as 24 months of extended payments for transactions of $500,000 or more. On the sales headcount being down dramatically: headcount is NOT down dramatically [analyst then admits to being mixed up]; probably take some non-performers out of sales. No reduction in R&D. On large upcoming sales in the pipeline: they continues to be encouraging; problem is the ability to convert the pipeline into license revenue -- that's challenging. On sales in geographies [world regions]: down in Japan, flat in North America, up everywhere else, up 7% in China in constant currencies [to exclude the effect of the stronger US$]. On competitors in China: Autodesk is at the low-end, Siemens at the high. On piracy in China: as high as with anyone else; "Pirate away," because we convert them to paid licensees when we find them. On encouraging PTC resellers: We have a whole vision around our product development system, versus competitors in the low end who sell almost disposable CAD seats. On the difference between large and small corporations handling the recession: we see no difference in size of company; the difference is in industry: automotive is "smacked pretty hard," aerospace and defense not so hard. On license revenues in future quarters: down 29% in Q1, down 40% in Q2, smaller seasonal spike in Q4, down 36% for the year.
"We actually think from a competitive standpoint, if you look how we did in the December quarter our Q1, versus Autodesk (Siemens is no longer publishing the numbers), but we actually did better than the competitors in terms of our growth or growing slower, or the reduction of the growth not being as fast," concluded cfo Cornelius Moses. phx.corporate-ir.net/phoenix.zhtml?c=116312&p=irol-irhome Readers Respond: "Recession-proof CAD products? I don't think so! "Mark these words: There will be no largesse for CAD vendors in the infrastructure stimulus budgets that may lie ahead. CAD is part of an industry that has risen with the tides over the years and has not made the waters come, as its proponents would have you believe. "Nowadays it's all about making rain and catching water in big buckets. The only rain made by CAD vendors in the last decade was the money earned by dealers during the channel years. But they are being consumed on one hand by a bad economy and on the other by their trusted suppliers. The rest of the business is taking their profits now while they can. "With no rain to float their boats, this year will end with scores of CAD salespeople furtively searching for wet spots in the rough rather than seeding clouds for future rainfall. CAD is now a mature business held up to the same standards as the rest of the B2B [business to business] world and subject to the same stupidity that governs the business world at-large. "More appropriately, the qualitative change wrought forth by CAD has already been made, hence everything else from this point on is incremental. It's the adoption of the screwdriver followed by all of its various iterations up through and well into the current century. "No late adopters left, the curve behind us, the paradigm shift over; it's now business as unusual." - - - "Interesting times indeed. I think most companies, large and small, are going to sit tight with whatever they have, rather than gamble on adding risk (potential incompatibility, training, deployment and maintenance) to their environment. NO cost is always more prudent than lower cost. Many places are facing layoffs, so ANY new spending is just suicidal to suggest. "I wish I could go into some of the more interesting, if not questionable, practices I've seen from some of the [technology] vendors lately at my company. Large enterprise customers like us seem to be the cashcow target of subscriber-drained vendors looking to buffer their shrinking revenue streams. Some are getting downright mean with their language and legal tricks. It's really showing us their true nature. "When the economy turns around, I can see some of those vendors will be kicked to the curb with little notice. Some of them have been our suppliers for over a decade. You would think vendors would be more flexible and helpful when times are like this, but I'm not seeing it at all." - - - "Thanks for picking up on this recessionary trend and the blog. You seem to be suggesting that customers respond to the recession and the opportunity to get advanced technology for little or no cost by burying their head in the sand and taking a pass. By sticking with old 2D technology, CAD users are passing up on the opportunity to greatly improve their productivity and reduce their costs. "3D design technology is much more productive than 2D, this has been proven many times by the ExpensiveCAD vendors, including Autodesk for Inventor. Take a look at our AutoCAD to Alibre Design Transition Survey at www.alibre.com/products/mechanical/autocad_to_alibre_design.asp . On average our customers saved ~20% by using Alibre Design and some reported costs savings as high as 95%. "You also say that 'This time around... Companies looking to cut costs will look at technology that costs nothing,' but fail to note that Alibre Design Xpress is the most popular free 3D CAD program in the world. (Alibre's low-cost business model is driven (or fed) by folks that start with our free product. This freemium model is also used by Google SketchUp and most of the other free software products in the market today.) "And while companies are retrenching, what happens to the trained engineers and designers that work for them? Some of them will be laid off and many others will take steps to prepare for a worst-case scenario. Steps that include equipping themselves with a low cost design platform and starting a side business or doing design consulting. Regardless of which, they become new customers for a low cost design platform. "In today's market, CAD seats are owned by companies and used by employees who have no right to use the software for their own benefit. In the future, CAD software will be like other productivity software such as word processing, spreadsheets, and personal finance, they will be owned by the individuals that use them. This is the market that Alibre is targeting. "Manufacturing companies seldom switch from one CAD package to another. Rather they get stuck and stay there. Hence the roughly 20 percent market share of each of the ExpensiveCAD vendors. New CAD seats are created and market share is gained whenever an event (historically technology advancement to a new platform with compelling benefits) occurs and a new leader emerges. Think Pro/E in the 80's and SolidWorks in the 90's. Clearly we believe that the emergence of a very low cost design platform combined with the recession is another generational event." The editor replies: "There is a cost associated with switching. I should have suffixed my sentence with 'costs little or nothing to implement.' "I feel bad for those who will suffer from layoffs, having gone through it myself, although at a young enough age for it to be more an irritation than a time of suffering. For some, it is a time of opportunity, such as when I got laid off as a civil engineer in mid-80s, and then 1.5 years later began with 'CADalyst' magazine. We all know what happened after that!"
COADE updates PVElite 2009 software for pressure vessel and heat exchanger design and analysis. It now models round, circular, and square vessel clips at different loads; flange design option; new MDMT calculation configurations; and support lug analysis for hydrotest cases. info.coade.com/content/PVEliteRelease Jimmy Bergmark tells me he's udpated his JTB FlexReport with improved network license reporting for FLEXlm/FLEXnet and IBM LUM. The revision history describes what is new in this release. Write info @ jtbworld.com for a no-charge time-limited version. Esperient imports Google SketchUp models directly into Esperient Creator v3.5 to create animated, interactive real time scenes. Prices range from free to $500. www.esperient.com The Open Design Alliance releases DWGdirect v2.7 with improved rendering performance and a beta SpaModeler module (for integrating Spatial ACIS 3D modeling). Meanwhile, DGNdirect v2.7 is better at handling MicroStation's V8 XM files. www.opendesign.com Geometric announces 3DPaintBrush v1.2, a visualization and rendering tool that create near photo-realistic images, animations, and videos from 3D models in real-time. www.3dpaintbrush.com Delcam has no-charge demo versions of ArtCAM Express and ArtCAM Insignia artistic CADCAM software. www.artcam.com ASCON Group now rents out its KOMPAS-3D software "from" e75 per month, and its 2D KOMPAS-Graphic "from" e30 / month for 3, 6, 9, or 12 months. After that, you can buy the software for the difference in price. For details, write to contact @ ascon.net SYCODE now has DWG and DXF import add-ins for SpaceClaim. www.sycode.com/news/09_01_21.htm Delcam CRISPIN splits its orthotic insoles design software into two: OrthoModel for design and OrthoMill for manufacture, respectively. www.delcam.com And Autodesk is showing a new rendering technology at its labs. Project Newport makes it easier to generate animated renderings of architectural projets. labs.autodesk.com/technologies/newport/ - - - These were some of the news items that were posted during the last week at the WorldCAD Access blog < worldcadaccess.typepad.com >:
And at the Gizmos Grabowski blog < worldcadaccess.typepad.com/gizmos/ >:
Seminars & Conferences SolidWorks World 2009 is Feb. 8-11 in Orlando FL USA. www.solidworks.com/pages/swworld09/index.html Geomagic's Convergence 2009 conference is Feb 24-26 in Savannah GA USA. www.geomagic.com/Convergence2009 2009 Civil Engineers' Summit & Expo is Apr 21-22 in Los Angeles CA USA. www.CENewsSummit.com ODA World Conference 2009 is Apr 27–29 in Leiden, The Netherlands. No Web page yet, but the planning committee is calling for presentations through www.opendesign.com/contact AEC Technology Strategies 2009 is Jun 11-12 in Las Vegas NV USA. www.aectechstrategies.com
Magazine/eZine/Weblog Updates DS SolidWorks updates SolidWorks 3D ContentCentral 2009 online self-publishing tools and new social networking components. www.3dcontentcentral.com/ First Trace launches its online Engineering Survival Center "to assist Engineering Enterprises through these difficult economic times" with articles on how tough the economy is, plus tutorials on using their document management software. www.firsttrace.com/survival-center Avatech Solutions offers its Online Seminar Learning service of training seminars "designed specifically to meet the current economic and competitive challenges." It consists of short sessions that instructor-led, low-cost, and topic-specific. www.avatech.com/training/seminar Siemens PLM Software opens its online resource center at www.siemens.com/plm/answers/smb for small manufacturing businesses.
People/Companies on the Move Bentley Systems appoints Pieter Neethling to the new position of solutions executive, mining and metals. Mr Neethling is the former IT manager of AngloGold Ashanti. think3 appoints Silvano Joly as new its new vp of worldwide marketing. Delcam appoints Randy Wightman as vp of dental business development in North America. Surfware promotes Greg Schils to product manager of all Surfware product development. The Novedge online CAD/CAM store is now a distributor of Aftercad Software's Aftercad Online service that integrates XML and CAD data. www.aftercadonline.com Autodesk completes its purchase of ALGOR for $34 million.
Market News Not all are in a downturn. Geometric reports that its revenues increased 31.6% over last year and 6.9% over last quarter to US$33.3 million.
New Books/eBooks "SolidWorks 2009 for Designers" "NX 6 for Designers" "Solid Edge ST for Designers" Published by CADCIM Technologies - - - "Doctor Walt’s KEYCREATOR 8 Workbook"
"Revit MEP 2009 Tutorial Series"
"Tailoring AutoCAD CUI 2009" (3th Ed.) WorthWhile Web http://www.guardian.co.uk/technology/2009/jan/28/not-safe-for-work-techcrunch-arrington
http://dezignstuff.com/blog/?p=1532#more-1532
http://www.theregister.co.uk/2009/01/29/fannie_mae_sabotage_averted/
Letters to the Editor Re: Orbita Web Site "I have to tell you that the Orbita web link also hammered my work laptop! It took me two days and multiple calls to tech support to finally get me back up and running. It must a sign of the times when so-calle 'trusted' Web sites still have these problems. "BTW, thanks for being a voice of reason and calmness in this often confusing business we're in. Keep up the great work of keeping the CAD community informed."
"Always good to hear what is going on in the world of CAD. Obviously I don't expect you to have control over other companies' web sites. Hopefully [the Orbita site's trojan horse] just a false positive, but you never know. Keep up the good work (1 out of some 300 or so newsletters is a pretty good average)." - - - Re: "This email is sent on 100% Unused Paper": "One of my brothers' email signature includes the line 'Contents subject to the terms and conditions printed on the reverse.' One of the IT people signs their's, 'There are 10 kinds of people in the world: those who understand binary and those who don't'." - - - Re: Note from the editor: this issue is shorter than usual, due to the editor recovering from the flu. "Thank heavens! I was afraid you'd laid yourself off!"
Spin Doctor of the Moment "Microsoft believes there needs to be greater openness and choice for customers in the mainframe market."
Notable Quotable "YAHOO = Yet Another Hiring Over and Out"
Copyright 2009 by upFront.eZine Publishing, Ltd. All rights reserved worldwide Article reprint fee US$250.0 and up.
All
trademarks belong to their respective holders.
"upFront.eZine," "Talking About CAD," and
"the business of CADg" are trademarks of
upFront.eZinePublishing, Ltd. |
|
|
|
|
|
|
|