In yet another reminder that we're not out of the economic woods yet, CIMdata revised its forecast for the PLM software market in 2009 and beyond, saying it now expects a decline of 2.1% in 2009 from 2008 revenue levels and a 3.5% compound annual growth rate from 2009 to 2013, to just under $31 billion in 2013. The company estimated the 2009 market at $25 billion.
In March, the research house had predicted 3.8% year-over-year growth in 2009 and 6.3% compound annual growth over the next five years — which would have pushed the market to $36 billion in revenue in 2013. Stating in a mid-year report released this week that ''the global economic situation has been even more severe than anticipated,'' the PLM consulting and research firm said it circled back to include data from the first half of 2009 in its figuring.
CIMdata said that ''comprehensive PLM,'' which includes ''the full product definition over the entire product lifecycle and across all industries,'' suffered a slowdown in new license sales in the back half of 2008, though services continued to be strong as users maintained existing programs.
Despite the downbeat forecast, the company said the longer-term outlook remains positive. CIMdata expects the PLM market to stabilize during 2009 and early 2010, and return to growth during the last half of 2010.
More specifically, the design tools sector, which performed above forecasts in 2008, is expected to grow at a rate of 3% over the next five years to reach $19.6 billion by 2013.
Collaborative product definition management (cPDM) technologies fell short of expectations in 2008, though the segment expanded 8.9% year-over-year to reach $8.2 billion. The 2009 picture won't be as rosy, as CIMdata predicts flat sales or a slight decline in growth. After that, however, annual growth to the tune of 4.2% is expected, with revenue rising to $10 billion by 2013. Digital manufacturing, which CIMdata describes as a ''key point of integration between PLM and the factory floor,'' rose more than 9% in 2008 to $530 million, but is expected to dip 2% in 2009. A return to growth thereafter is expected to produce a 4.4% compound annual growth rate, with revenue topping $630 million in 2013.
The short-term trend sees companies focusing on the ''bottom-line benefits of PLM for controlling costs and improving operational efficiencies,'' the report states. ''Even as these short-term priorities dominate the current market, long-term strategies still continue at many companies that are focusing on using PLM to best position themselves competitively for when the world emerges from the current economic chaos.''
Some of the long-term drivers CIMdata points to are ''harmonizing global processes, managing the increased complexity of products and value chains, effectively managing the growing range of compliance issues, and improving competitiveness and pricing structures by improving product quality and lowering costs.''
