The Impact of PTC’s Acquisitions and Partner Strategy on Product Development

Since the $112 million acquisition of ThingWorx in 2013, PTC has spent more than US$2 billion on acquisitions and strategic partnerships. These activities have solidified PTC’s place as an IIoT software powerhouse when it comes to digital transformation. This Insight analyzes PTC’s recent acquisitions and partner activities over the last 24 months in the context of its product development and GTM to inform how the industrial software leader’s product portfolio will evolve.

In October 2019, PTC acquired Onshape (see IN-5645), a Software-as-a-Service (SaaS)-native product development platform, for US$470 million. Onshape is relevant to other business areas such as Vuforia (PTC’s augmented reality (AR) solution), Creo (computer-aided design (CAD)), and ThingWorx because the underlying Onshape technology will underpin PTC’s SaaS platform, Atlas, which all PTC products will be deployed on over time. Other notable components of PTC’s IIoT offering that will benefit from this SaaS strategy include Solution Central, Solution Central Edge, and Flow. 

In February 2020, PTC made an IP acquisition from Vimana, an industrial analytics provider. The IP acquired supports advanced calculations of time-windows, which is highly relevant for driving analytics solutions for manufacturing and service efficiency because of the ability to correlate and compare both sequential and concurrent events. This codebase will be incorporated into ThingWorx and used primarily in the portfolio of solutions that will continue to be available on the platform.

In April 2020, PTC made another IP acquisition of PCUBED from McKinsey to support the workflow management elements of the Digital Performance Management solution that will be released in September 2021. The assets acquired will not be used directly in the DPM solution but are being used to guide and inform its creation.

In December 2020, PTC announced its largest acquisition to date (after OnShape) by picking up Arena Solutions, a provider of SaaS-based product lifecycle management (PLM) (see IN-6024). The Arena acquisition further prepares PTC for the shift to SaaS-based PLM platforms and enables a CAD and PLM proposition that gives customers a variety of deployment options: on-premises CAD (Creo), SaaS-based CAD (Onshape), on-premises PLM (Windchill), and SaaS-based PLM (Arena).

This combination of acquisitions allows PTC to better support manufacturers across discrete and process industries, in addition to utilities and transportation. The most significant is the acquisition of OnShape, since the platform will underpin PTC’s future SaaS efforts, followed by Arena. PTC has also formed strategic alliances with Rockwell Automation, Microsoft, and Ansys, which cannot go overlooked.

In the case of Rockwell Automation, the FactoryTalk Innovation Suite includes ThingWorx, Kepware, Vuforia, FactoryTalk MES, and FactoryTalk Analytics (see IN-5989). Rockwell Automation sales teams re-sell ThingWorx, Kepware, and Vuforia, and the arrangement has been extended through FY23.

As for Redmond, Microsoft is PTC’s preferred industrial cloud provider, and PTC co-sells ThingWorx on Azure with Microsoft. Part of PTC’s broader alliance with Microsoft includes Augmented Reality/Mixed Reality development, most notably Vuforia for Microsoft HoloLens.

Ansys fills the simulation gap. By doing so, it gives PTC a seat at the table with other simulation vendors such as Altair, Autodesk, Dassault Systèmes, Hexagon/MSC Software, and Siemens (see CA-1317), and allows it to compete for more deals. This strategy means that in some cases PTC can compete head on with vendors in adjacent spaces; other times, partners own the relationship and act as resellers of PTC capability. Like the Microsoft and Rockwell Automation, the arrangement with Ansys is a little bit of both.