To reach market dominance you need to find the market capable of bringing large revenue numbers. This means PTC bought the market expansion and now can lure all customers looking for SaaS solutions into Arena (Jim’s electric car allegory works great here). Even functionality of both (Windchill and Arena) might have the same name (BOM, change management, etc.), Windchill and Arena have almost zero overlaps in the market. I think, tactically, this approach is brilliant.
It’s the same with SaaS: people who want a SaaS PLM won’t look at Windchill but will look at Arena.” People who want an electric car aren’t even going to look at combustion engines. As PTC Ceo Jim Heppelmann put it (paraphrasing here): “It’s like buying a car. Until then, Arena plus Onshape will offer those clients who are interested in SaaS a way of engaging with PTC.
One thing is clear from PTC investor day last week, just after the Arena acquisition was announced: PTC sees Arena as enabling it to offer a SaaS PLM product while they work on getting Windchill onto a SaaS architecture. Here is the passage I took from Monica’s blog: But Arena’s revenue is insignificant when it comes to the overall cPDM revenue (based on CIMdata assessment, it is almost $7B for 2019).Īccording to Jim Hepplemann PTC will be working on new SaaS offering and meantime selling Arena SaaS solutions. Arena Solution is most probably representing the biggest chunk of SaaS PLM revenue (~$50M ARR according to PTC) delivered in the traditional segment such as aero, defense, auto, industrial, high-tech, electronics. The article made me think about the second portion of the question – SaaS dominance in PLM. I like the thought process about PTC trajectory in solution building between Windchill and Arena delivery each own channels and PTC Atlas is building a new formation of yet to be discovered PTC SaaS PLM.
Monica Schnitger is asking a question about SaaS dominance in PLM following the PTC acquisition of Arena Solutions.
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