Now in looking back on 2010, I believe that the tipping point was attained. What does that mean? Read on...
Parametric Technology's finances are improving, but is the stock over priced?
Autodesk’s revenues in the most recent quarter rebounded more than its peers in the engineering-software business who depend on PLM.
July 29, 2010 – Dassault Systèmes (Paris: DSY) reported a 24 percent rise in revenue (in euros) and a 90 percent increase in net income for the quarter ended June 30, 2010. However, this seemingly stellar performance was not the result of increased demand for Dassault Systèmes engineering-software products. Most of the rise appears due to two factors: the acquisition by Dassault Systèmes of IBM’s PLM marketing business and the eight percent drop in the value of the euro compared with the US dollar.
July 27, 2010 – Parametric Technology Corporation’s new license revenues soared 36 percent compared with the like quarter a year ago. New licenses are a harbinger of better times, because consulting and annual maintenance are almost sure to follow. During the economic downturn, large customers delayed big software projects, from which PTC derives a growing share of its business.
Late on the evening of October 26, IBM announced its intention to sell its "IBM sales and client support operations encompassing DS's Product Lifecycle Management (PLM) software … customer contracts and related assets" to Dassault Systèmes. Since 1982, IBM has sold and supported Dassault Systèmes CATIA and related software. The announced sale, which is expected to close in the first half of 2010, ends that relationship.
IBM will receive $600 million in cash for its PLM business. Approximately 700 IBM employees, including PLM general manager Al Bunshaft, will join Dassault Systèmes.
Dassault Systèmes' competitors, Siemens PLM Solutions, Parametric Technology, and Autodesk, are likely to blow the current transaction out of proportion, claiming that Dassault Systèmes has lost a major sales advantage. In reality, this deal is likely to have modest impact on both companies.
IBM will be shedding a relatively small part of its software business that doesn't fit with its main strategy ...