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7. CAD software history, 1998-99

PDM, the Internet and PLM...

1998 was the year in which DEC, after a decade of struggling to regain its glory of the 1980s, was acquired by the "PC clone" maker Compaq. The message that DEC's acquisition sent across all software markets, including the CAD software market, was in a sense confirmation of what was already a well established fact: if it did not run on Windows then it probably did not run. The market had come a very long way in just two decades.

The CAD software market in the late 1990s was marked by three main developments, each of which was driven by the basic premise that it was no longer possible for the leading CAD software vendors to compete and grow simply on 3D CAD software revenues. The three developments were:

  1. acquisitions and consolidation,
  2. the rush to gain share in the PDM market,
  3. the stampede to become "Internet enabled".

Dassault Systemes started the run of acquisitions when it bought SolidWorks in 1997. In the same year EDS-Unigraphics acquired SolidEdge from Intergraph and Dassault also acquired Deneb Robotics (founded in 1985) the leader in the manufacturing visualization market. The biggest shake-up of the CAD software market since its inception then occurred in 1999 when Parametric Technology, then market leader, acquired former market leader Computervision. Also in 1999 Dassault acquired Matra Datavision, another well established CAD software vendor.

Meanwhile the dot-com bubble had been triggered in May 1997 when Amazon.com had completed its successfully IPO. By the end of 1998, Amazon.com's market cap had soared to $17billion and showed no signs of slowing its rate of ascent. In all industries, including the CAD software industry, vendors were devising strategies to become "Internet-enabled", benefit from the enormous B2B revenues that were then being predicted and of course have their share price benefit from the stock market's craze for Internet stocks.

Although a few companies (such as Alibre founded in 1997) were soon announcing client-server Internet enabled 3D CAD software which would allow full 3D modeling across the Web, the main focus was to enable viewing of 3D models in Web browsers and building Internet/intranet browser interfaces to PDM systems. One of the leaders was Dassault Systemes, which benefiting from its experience of integrating CAD software across networks for the Boeing 777 project, had already made its first move toward Internet enabled CAD software in 1996 with its CATIA Conferencing Groupware, which enabled review and annotation of CATIA models across the Internet. In 1997 Dassault released its CATWeb Navigator which provided enhanced Web based viewing of CATIA 3D models and assemblies and then in early 1998 created its ENOVIA subsidiary to develop the PDM II system (which could use the CATWeb Navigator module to provide Internet enabled PDM).

In 1998 EDS spun-off the Unigraphics and iMAN division as Unigraphics Solutions and sold 14% of the new company in an IPO. In 1999 Unigraphics Solution's President John Mazzola announced that the company was realigning itself to focus more intently on Web-enabled PDM and desktop visualization and the iMAN Web Author extension to its iMAN PDM software was launched. Also in 1999, Parametric Technology announced its alliance with SupplierMarket.com to add an ecommerce aspect to Parametric's newly launched Windchill PDM software, Dassault announced that it was acquiring Smart Solutions and its SmarTeam Web enabled PDM software and CoCreate, formerly the CAD software division of Hewlett-Packard, announced its OpenSpace Web enabled 3D portal.

Compared to the rush of acquisitions, new PDM software releases and "Internet-enabled" upgrades, the changes in 3D CAD software were few and far between in the late 1990s. Once Dassault Systemes released its long awaited CATIA Version 5; the first version of CATIA to be fully implemented on Windows; in 1999, all the leading vendors had fully implemented Windows look-and-feel CAD software with large assembly viewing capabilities, sketching and constraints management, feature-based history, etc. To upgrade its 3D CAD software offering to compete bead-on with the traditional (and newer such as SolidWorks and SolidEdge) 3D CAD software vendors, Autodesk released its new Inventor 3D CAD software based on Spatial Technology's ACIS kernel in 1999. Inventor was the first Autodesk mechanical CAD software not to be based on its AutoCAD architecture. Also in 1999 the Italian CAD software company CADLab changed its name to think3 and renamed its EurekaGold 3D CAD software to thinkdesign.

While the dominating news of the year was Parametric Technology's acquisition of Computervision and how that would affect the CAD software industry, the less obvious news was that there were no longer any fundamental technology breakthroughs being made in 3D CAD software. There were a number of new small niche 3D CAD software vendors appearing with various low-cost products based on the two major 3D modeling kernels (Parasolid from Unigraphics Solutions and ACIS from Spatial Technology; Ricoh's Designbase had effectively disappeared from the commercial 3D kernel modeler wars in 1997) but no new major technology breakthrough had appeared in over a decade since Pro/Engineer had been launched back in 1987.

37 years after Ivan Sutherland published his SketchPad thesis, the CAD software industry had clearly entered what Clayton Christensen would term its period of "sustaining technologies".

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