By Ira Breskin

CAD/CAM/CAE, once the belle of the ball, now is the industrial software girl without the curl. Sexier collaboration tools have recently stolen the limelight from these powerful configuration tools that generate a product's seminal mechanical design and related physical analysis. The shift comes amidst the continued weak across-the-board market for software that began more than two years ago.

Despite the lack of marketing muscle, CAD/CAM/CAE remains the largest and most important component of what has evolved into a $13.5 billion enterprise-centric industrial design software segment now dubbed product lifecycle management (PLM).

Most of PLM growth last year focused on collaborative tools and related services. This segment, with $4.2 billion in sales, represents 39% of the PLM market. Total growth will be almost 6.2% this year, less than half that reported in 2002. Gains last year came only from increases in services; software sales declined 7%, according to CIMdata.

CAD/CAM/CAE sales in 2003 will increase by about 2.5% to about $9.5 billion, says Ken Amann, research director of CIMdata Inc., a market research firm based in Ann Arbor, Mich. The gain, although modest, follows two years of flat sales, according to CIMdata.

At more than $8 billion CAD software represents the bulk of this mature market. Sales of the second largest category, CAM software, last year were about $1.1 billion, or 11.4% of the total. The third category—CAE—is small, but growing fast. Sales of computational fluid dynamics software, the second largest type of this analytic software, grew by 14% to $235 million, according to estimates from industry consultants Daratech Inc., Cambridge, Mass.

So what will drive CAD/CAM/CAE growth in 2003?

Better integration of CAD/CAM/CAE capability into a discrete CAD tool whose acceptance will readily extend beyond the engineering/design world, its core market, says John MacKrell, a CAD consultant with CIMdata.

For example, the latest tools generally improve:

· Product simulation and motion, allowing viewers to better anticipate the behavior of products as well as factory operations;

· Bundling of design and high level analysis capability so major structural problems can be addressed early on;

· Real-time collaboration by integrating some Web-based tools into CAD packages.

According to Bruce Jenkins, Daratech executive vice president, CAD users also commonly request features which:

· Enhance interoperability between proprietary CAD systems;

· Incorporate cost data so design alternatives can be more easily considered;

· Improve design process workflow to increase operating efficiency.

Given that addressing specific customer needs should translate into market share gains in this slow growth period, CAD/CAM/CAE vendors have strong incentive to continue upgrading their highly engineered products.

Editors: Larry Marion and Debra Bulkeley
Copy Editor: Deb Cooper

Author Bio:
Ira Breskin, a freelance writer based in Great Neck, N.Y., is a frequent contributor to Barron's Online, The New York Times, as well as several websites and trade magazines. He can be reached at ibreskin@optonline.net.

For more information about PLM systems, visit www.EnterprisesoftwareHQ.com. It has a detailed listing of vendors and their products. In addition, you can review hundreds of functions now provided by PLM software vendors to determine which ones would be useful for your organization's PLM efforts.