If you consider PTC's moves over recent years, it would be easy to weave a story around reinvention. With a two-decade heritage in engineering-oriented product design tools, the company later branched out into service and support software along with other areas like technical documentation applications and embedded software management platforms.
More recently, PTC has been on a rapid-fire, razor-focused mission to become a dominant force in the internet of things market. Yet rather than viewing this as a pivot, PTC officials contend the move is part of an ongoing strategy to do what PTC, IoT related or otherwise, has always done: help companies create, manufacture and service products.
"If you think about where we come from and what we do, we help companies create digital prototypes of products before bringing them into the physical world," explained Mike Campbell, PTC's executive vice president of ThingWorx product management and a veteran of its computer-aided design (CAD) business. "As IoT came to light and companies started thinking about smart, connected products and operations, we saw it as the space PTC was already in. Sometimes people say, 'PTC is a CAD company, what in the world are you doing in IoT?' Of course we need to be in IoT. It's just another way to do what we've done."
Mike Campbellexecutive vice president of ThingWorx Platform, PTC
While PTC has historically delivered tools to help engineers design and build products, its prior portfolio of software pretty much loses touch with a product once it's delivered into the field. With IoT, a new generation of smart, connected products can churn out near-real-time data, which can be collected and analyzed for insights using the ThingWorx product suite. As a result, manufacturers can understand what's happening with a product when it's out in the field, Campbell said, allowing them to predict over time, for example, when a wind turbine blade might encounter deformation from over usage, or when an aircraft engine has a problem that might require service. The same capabilities can be applied to sensor-equipped plant floor equipment, allowing manufacturers to do preventative maintenance to minimize downtime along with real-time data collection and analysis to optimize operations. Engineers can also take advantage of IoT intelligence to improve subsequent product designs, which is far more effective than designing from a set of idealized requirements, Campbell said.
"Without IoT, companies would only understand what was going on with their product when a customer picked up the phone and called to report a problem," he explained. "If you can instrument a product and understand how it's used, that's gold."
PTC + IoT = Staying ahead of the pack
PTC has taken its IoT mandate seriously, putting its money where its mouth is. Since 2013, the company has spent more than $500 million on acquisitions of companies with IoT-related technology, including ThingWorx, its flagship IoT application development platform, Axeda for connecting devices and sensors securely to the cloud along with monitoring capabilities, ColdLight for analytics and machine learning, Vuforia for augmented reality, and Kepware for connectivity capabilities in the area of industrial automation. PTC has also forged a number of strategic alliances to bolster its IoT play, including one with GE Digital to meld ThingWorx capabilities with GE's Brilliant Manufacturing Suite, and with Bosch Software to integrate ThingWorx into the Bosch IoT Suite.
While the PTC IoT suite came together via acquisition, the firm has spent a tremendous amount of time and money integrating the technologies so they work as an integrated platform, Campbell said. "What people don't want is a toolbox they have to put together," he explained. "The value of ThingWorx is that it's fast and easy."
So far, ThingWorx is still a relatively small part of PTC's business, running at annual revenues of around $100 million, but PTC's goal is to grow this to $250 million by 2020. Already, PTC is giving the competition -- what research firm IoT Analytics estimates at 360-plus IoT platform providers -- a run for their money. IoT Analytics said the IoT platform market is estimated to grow at a CAGR of 33%, bouncing from a mere $298 million in 2015 to a $1.6 billion opportunity by 2021. The current IoT platform leader is PTC, IoT Analytics found, with an 18% market share of a still relatively small market.
Beyond growing its customer base, PTC also sees a role for ThingWorx in reimagining its own traditional software suite, Campbell said. It's incorporating some of the ThingWorx IoT capabilities into its core tools like the Creo CAD package and Windchill product lifecycle management (PLM) platform to deliver new capabilities that are relevant to its traditional base of users. Consider, for example, the relatively new PTC Navigate, which facilitates data access between enterprise systems for non-Windchill users by leveraging the ThingWorx connectivity capabilities for improved integration and connectivity. Since it was released five quarters ago, PTC Navigate has already generated $18 million in sales, Campbell said.
"Things can be anything -- a device, a Raspberry Pi, a washing machine or an enterprise system," Campbell said. "ThingWorx will go off and pull information in from other enterprise systems and present it in meaningful ways."
In addition to the strength of its ThingWorx IoT platform, Joe Barkai, an industry consultant and author specializing in PLM and IoT, said PTC has an opportunity to differentiate itself in a crowded market by leveraging IoT to extend the reach and influence of PLM, particularly for product service and maintenance applications.
"I sometimes refer to this as putting the 'L' back in PLM," explained Barkai, author of The Outcome Economy: How the Industrial Internet of Things is Transforming Every Business. This should be a natural for PTC. "IoT should not be positioned as something new or a replacement to PLM," Barkai added.