Built from the ground up, Onshape is the industry’s first pure SaaS platform that unites robust CAD with powerful data management and collaboration tools. PTC made headlines this month when they announced their $470m acquisition of Onshape. Since the announcement, there has been speculation about what this means for both Creo and Onshape... so let's take a look at why PTC choose to make this acquisition - and what it will mean for the industry.
Onshape’s cloud software seamlessly blends powerful 3D CAD, collaboration, and data management capabilities in a solution that runs in a browser on Windows or Mac computers. There isn't anything to install or set up. There's also nothing to administer, patch, upgrade, or backup. All of the data resides at all times in a database in the cloud, which eliminates the need for file servers or similar infrastructure for storing and sharing data. You can also get a full-featured Onshape app in both the iOS and Android app stores; which appeals to many users due to the astronomical increase in mobile use.
PTC has helped mold the CAD market into what is has become today. With that being said, they seem to have a strong sense of where it will head over time. To this day, the CAD market has mainly been an “on-premise” market. Over the past few decades CAD has migrated from mainframes and terminals, to Unix workstations, and finally to Windows PCs. In each generation, the hardware and software has been installed and maintained at the customer site. Some vendors, including PTC, offer managed services to run the software for you on their servers, allowing you to use the software as a service rather than as an asset you own. However, each customer’s system still requires someone to perform installation, install security patches, execute upgrades, and carry out other kinds of administration work. The system administration workload has simply shifted from the customer back to the vendor.
In nearly every category of business software other than product development tools, the industry has evolved a big step beyond managed services to a pure SaaS model. In a pure SaaS model, the software has an entirely different architecture. SaaS technology is very different, but so are the business processes. Up-time standards are extremely high, frequent system-wide upgrades require very careful planning and testing, and backward compatibility of external interfaces is a must.
"In my view, the acquisition of Onshape provides demonstrable proof of how deeply PTC cares about our CAD and PLM future. We want to capture market share now, and we want to ensure our long-term sustainability as a CAD and PLM vendor as the market shifts toward SaaS over time. We will continue parallel innovations in Creo and Onshape for as many years as I can foresee. We’ll look for opportunities to share technology back and forth between the different platforms," states CEO and President of PTC, Jim Heppelmann.
PTC plans to make Onshape a full-featured SaaS complement to Creo. Not only does Onshape release new capabilities every three weeks, but the entire customer base is upgraded with each release. Every customer is on the latest version, immediately benefiting from all new feature innovations and patches - and the best part is, they didn’t have to do anything to get themselves there.
Both ThingWorx and Vuforia were smaller than Onshape when PTC acquired them, but have rapidly grown to be extremely large today. In each case, PTC has been able to accelerate the technology roadmap through higher investment levels and additional skill sets: to increase visibility through broader sales and marketing, provide the safety factor that startups really need to give comfort to customers, and even make additional tuck-in acquisitions to help round out the functionality. ThingWorx IOT business has grown 60-fold since PTC acquired it 6 years ago. Additionally, the Vuforia business has grown 10-fold in a much shorter time. PTC plans to achieve the same growth with their most recent acquisition of OnShape.
On November 1st, the CEO and President of PTC, Jim Heppelmann, released an open letter about the adoption of OnShape; which you can read here.