PTC Rockwell tie-up “more important” than GE

[ Editors Note see: Rockwell investing $1B in Massachusetts software company PTC  ]

At the company’s LiveWorx show in Boston this week, PTC CEO Jim Heppelmann filled in some key details on the software company’s deal with the industrial automation giant, signed last week.

“We do have a partnership with GE, but frankly, that partnership is not as active, because in the era of a new CEO, GE has retrenched a little bit when it comes to their own digital aspirations,” Heppelmann told Internet of Business.

“So at this point, I would say that the Rockwell partnership is many times more important to us than the GE partnership, but the GE partnership remains technically in place.”

Reach is the key, and with Rockwell’s sales teams on its side, PTC will be much better able to get a foot in the doors that count, not just with the discrete manufacturers where it already has many customers, but also in process manufacturing, where it is less well connected.

As Heppelmann explained, most of PTC’s smart factory sales have been handled by the company’s own direct sales group, which numbers around 330 sales teams. But only around 25 of these are focused specifically on factory environments.

Rockwell, by contrast, has over 1,000 sales teams that work specifically with factories, and a strong presence in key process manufacturing sectors, particularly pharmaceuticals. In other words, this deal could help PTC sell its three most relevant industrial IoT applications (all acquired technology) into a far broader base of manufacturers.

Internet of Business says

It was very clear that the real focus for future growth at PTC is in smart factories and industrial IoT.

The company’s IIoT software business, said Heppelmann, is growing at around 40 percent annually. In revenue contribution terms, it’s already as big as the company’s longstanding product lifecycle management (PLM) business, represented by the Windchill line, and will overtake that business next year.

While still not as big as the company’s CAD software business, Heppelmann expects IIoT to overtake CAD in 2020.