Future PLM face to face: Open Source vs. Cloud

I was thinking about future options for PLM in today’s computing environment. In this fast moving world, there are two spaces that not widely experienced by the creators of PLM software. I’m referring to (1) Open Source; (2) Cloud Services. Using some legendary analogies, I can align each of these options as the role of David in his fight against Goliath. Both of them can be considered definitely as weak characters facing  enterprise giants. The PLM community has two clear representatives of both OSS and On-Demand options (Aras and Arena Solutions). So, I want to analyze and discuss – from your standpoint, what is the more appropriate option for the future of PLM?

Cloud Software and Services

In my view, cloud computing definitely shows a very promising future as a software model. Providers of cloud software can provide two big advantages – work better at a lower cost. At the same time, potential users of clouds have consistent concerns such as lack of control, security and, lack of flexibility, the latter being of particular concern for PLM. Still, time is still needed to create established communities around the upcoming cloud services and platforms. These will include infrastructure, management, research and development. Some of them are showing progress but they are very far from being mature. Future investment in cloud data centers can make this faster. In the PLM eco-system, the only company that has created a long-running Cloud-based offering is Arena Solution. However, in my view, they haven’t developed a real economy of scale on the cloud. Together with traditional security concerns and the significant lack of integration with existing enterprise and design software, Arena wasn’t able to scale up and compete with existing PLM kings, in my view.

Open Source

I already discussed Open Source Software for PLM in one of my previous posts < Open Source: Is the Game Changing for PLM? >. Open Source can provide two major advantages for PLM implementation compared to what we have today in PLM – a low entry cost and significant flexibility. These advantages need to address the regular concerns of enterprises in front of open source software such as certification, legal issues etc.  Therefore, I see Aras’s experience in open source as something very interesting, and it requires future investigation and learning.

Alternative Combination: Open Source on Cloud

Of course, this discussion is not complete without discussing the combination of Open Source and Clouds (with Open Source running on a Cloud). I have to say that today’s cloud services software, especially in the consumer domain, is pretty much based on OSS.   The so- called “LAMP stack” is one of the most used combination of open source infrastructure. What will happen in the future when enterprise PLM providers (ERP and dedicated PLM vendors) start moving towards one of these options? This is still not clear.

So, I’m very interested to hear your voices. Pros and Cons? What is your winning option?

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  • Oleg, I thought I might share a comment or two on this (re:Arena).

    You said: “However, in my view, they haven’t developed a real economy of scale on the cloud. Together with traditional security concerns and the significant lack of integration with existing enterprise and design software, Arena wasn’t able to scale up and compete with existing PLM kings, in my view.”

    I’m curious what you view “scale” to be. The have hundreds of customers, and 10’s of thousands of users. And given the cloud delivery, single instance, multi-tenant they are able to enjoy very nice economies of scale.

    As to competing with the “kings”, I don’t think that’s their goal. They would be, I believe, very happy to displace “The King” — excel. In this regard, the are aiming to serve the masses, rather than the ones with mass. Also, given the market they serve, they actually do cover all of the relevant integrations, at much lower cost and ease of install than the so-called Kings.

  • Mark, I think this is important comment and point of view. I agree, Arena is serving a specific market niche. My point was that I haven’t seen Arena dominant provider of “cloud PLM services” if you will. As you mentioned “displacement of Excel”, I think, Arena cannot massively displace Excel because of lack of flexibility compared to what you have in Excel. I agree, this is potential goal and I’m sure they did a lot in displacing Excel for their customers. – Regards, Oleg

  • I agree on the comment about the massive displacement of excel — although I would contend that it will be even harder for the “Kings” to do so. The niche that Arena serves is “only” 100’s of thousands of small to midsize manufacturers out there. Sort of like salesforce, it can be a large opportunity.

  • Mark, completely with you… “Kings” of PLM are not competing with Excel. They try to co-exist… Best. Oleg

  • Hi Oleg,

    Do you have any statistics on how common the LAMP stack is?

    Our experience is that the enterprise desktop is almost 100% Microsoft, 80% IE, and the backoffice is about 50% Microsoft. Except for “small” niches like web servers, most non-MS servers are running legacy unix environments like Solaris, HP-UX, and AIX.

    I believe that the future is bright for LAMP, but, a strong market share especially in the PLM space is several years out. Comments?

    Tom Gill

  • Brian Pye

    Hi Oleg,

    We are looking at PLM systems to help bring a more mature environment to our design group. At present there is no way that we would touch cloud services due to the uncertainties which you note.

    We are seriously investigating Aras as a solution due in part to the lower entry cost than traditional PLM offerings, though what really impresses me is the flexibility of the solution (once you really appreciate how Innovator is put together).

    The community content, supplied free to extend Aras Innovator, from other Innovator users is a tremendous benefit to all and in my mind points to the most impressive potential of a system like this. Anyone can develop and submit a solution which is then available to anyone else. With potentially thousands of developers covering a vast number of markets a good open source solution should be able, in time and with sensible marshalling by the solution conceiver, to contend on the same footing as the “Kings”.

    Aras has a way to go with market take up but I for one hope that the market realises the potential of open source systems and starts to really support them on a wider basis.

    Brian Pye.

  • Tom, I don’t have a specific market share numbers for LAMP. I assume you numbers are from enterprise market and I think you are right. On the other side of the world (http://www.slideshare.net/anantshri/introduction-to-lamp-stack) LAMP stack serves successfully very big companies from Google to Flickr. So, I see potential opportunity for OSS, but it still not happens in my view. Regards, Oleg.

  • Brian, Thank you for your comment and welcome to plmtwine! I appreciate your insight and I think it reflects a specific market situation we have today. Best regards, Oleg.

  • mwynn

    My experience is that no manufacturers are going to put proprietary data onto a cloud. They instst on keeping it in house.
    Manufacturers want to manufacture competitive products, not employ open source programmers.

  • Mr. mwynn, Thanks for your comment and welcome to plmtwine!
    I believe manufacturers want to decrease cost of IT solutions. I believe cloud is one possible option to do so. What set of curcumstances can move manufacturers in their decisions? Best, Oleg.

  • dasteph

    I agree with mwynn. I don’t know too many organizations willing to put their intellectual property out on a cloud. Actually had the experience just the other day on an ERP system of an organization willing to spend about $1K/seat rather than go out to a cloud.

    Also, I’ve had a little experience with the Aras solution and the Aras community. It’s all been very positive and if you think of how many small and medium companies have a MSoft server in the back room… this should be a no brainer.

  • Dasteph, I think you are right. Most of the companies have MS server ready to deploy At the same time, companies can use some mixed strategies to keep data on cloud and physical files on secured vault locations inside of company. I’m not sure it make difference, but this is can be potential alternatives. In addition, I think this is different for different industries and segments of the market. For example, companies can be less sensitive if this is related to released products – you can buy products and reverse engineer them. I think in many cases IT use Intellectual Property topic as defense strategy to keep IT in the company. Regards, Oleg.

  • Paul Bock

    I think the cloud should come down a bit and be closer to the company involved. Like a fog. My company’s IT group keeps thinking in centralized terms. They really like their singular “big boxes”. I think the future is distributed data, distributed storage, and distributed computing. By distributing these things over a company’s existing local resources, you sidestep all the issues surrounding storing proprietary data on remote machines.

  • Paul, I think you mentioning very valid point- how to bring cloud to IT without position it as a competitive curve. I hear many discussions about public vs. private cloud. I think, in the end, cost and security are two major drivers for cloud in enterprise. If companies will assume cloud is secured enough and IT will see a significant difference between running their “big boxes” vs. Amazon (or whoever else) boxes, it will be done deal. But, I don’t believe we are there… In my view, cloud today is an option for smaller companies. Thank you for your comments! Best, Oleg

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  • Rahul Kulkarni

    Now. Come to the reality. We do need a sustainable development. Oil will be end in few year and so the automobile sector , or heavy manufacturing sector.
    There will be many users who will work individually on products. May be a home industry.
    We need a platform to bind them together. So that can come with an alliance.
    Think of changing society and them PLM.

  • Rahul, Thanks for commenting! I think, PLM can definitely support a sustainable development. The ability to control all aspects of product data (from design to disposal) can be beneficial to achieve sustainability goals. Best, Oleg

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