PTC buys Intland (Codebeamer)
Among other things, Intland is known for Codebeamer, a tool for requirements management. Intland has now been bought by PTC. This type of acquisition is not unusual and is reminiscent of the purchase of Polarion by Siemens in 2015. What does PTC expect from this and what does it mean for systems engineers? An analysis:
The acquisition was completed one week before the ReConf and was a frequent topic of conversation there. Even though both PTC and intland were there as exhibitors, the colleagues could tell me little more than what was in the Press release was to be read. For example, that PTC paid an amount of $280 million.
Consolidation of the market
Five years ago, there was a small wave of interesting Acquisitions and a certain amount of consolidation in the market, things have recently become somewhat quieter. This certainly has something to do with the fact that the market for Systems engineering tools is comparatively small. In addition, comparatively little has changed in the state of the art.
Concrete example: Tools for requirements management hardly developed at all in the 90s and 2000s. IBM DOORS (classic), Borland Caliber, or MKS Integrity were popular. Then came a new wave of web-based tools in the 2010s: Polarion, Jama, DOORS Next and, yes, Codebeamer. There are also a number of quite respectable solutions, but they can hardly keep up with the big players in terms of market share. Visure and R4J should be mentioned here as examples.
Integration is the killer feature
Even if the tool manufacturers like to pretend otherwise, the leading tools all have a similar set of features. What is more important to customers today is seamless integration into the IT landscape. Accordingly, the topic of integration dominated the press release. PTC is a portfolio company that already includes a whole set of tools for product development. These include Windchill (PLM), OnShape (CAD) and many others.
Siemens added an RE tool to its portfolio in 2015 with Polarion. Now PTC is getting an RE tool with Codebeamer.
What about Windchill RV&S (formerly Integrity Lifecycle Manager)?
However, PTC already has an RE tool in its portfolio, namely Windchill RV&S, better known under the old name Integrity. But Integrity is now over 20 years oldis not web-based and was also added to the portfolio via an acquisition. PTC has probably been able to realize a few major deals in the automotive industry in recent years. PTC has also made the user interface at least partially web-enabled. So why not continue with Integrity?
I suspect that PTC thinks it makes more sense to phase out Integrity in the medium term. It's probably cheaper and less risky to buy a good product than to try to turn an ancient product into a useful one. In addition, Codebeamer has had a lot of success in the automotive industry in recent years. If PTC is smart, this deal will add significant value to the PTC portfolio.
This thesis is also supported by the fact that Windchill RV&S is not mentioned at all in the press release. Two years ago, PTC began to use the name Integrity no longer to be used. Instead, they present a holistic solution.
Who is left?
Of the "four big" RE tools, three are now part of portfolios: Polarion, DOORS Next and Codebeamer. Only Jama Software is the only company left that only sells a single product.
Jama Software has already received 2018 an investment of $200 million from Insight Partners
Insight Partners
Jama received a cash injection of $200 million four years ago. This certainly explains in part why PTC did not acquire Jama. Based on the 2018 investment, the purchase price today would certainly be many times higher than the $280m that PTC paid for Intland. That even makes Intland a bargain.
I doubt that Jama will remain independent for much longer. After all, it is part of Insight Partners' business model to only support companies for a limited period of time.
