Innovation and technology can make things cheaper. This is an interesting trend we are observing for the last few decades. Consider that – computers are 1000x time cheaper than 3 decades ago.
I picked up few data points about how technology changed the cost of things. It is pretty amazing numbers. Navigate to the following article to learn more – Six Things Technology Has Made Insanely Cheap. Among all these things, I found a chart about price of software very remarkable.
Computer software now costs 0.7 percent of what it did in January 1980. Since some of the world’s most-used software today is free, this is no surprise.
It made me think about enterprise and PLM software. What technology can make it more affordable. I discussed Cloud PLM cost and lessons from Uber few months ago. Although cloud PLM made a difference in terms of upfront cost and IT resources, large cloud PLM project is still might come with six figures price tag.
High cost is one of the biggest reasons of PLM low adoption among wide range of manufacturing companies. Clearly one size doesn’t fit all, but when it come to $1M price tag, engineering IT will try to explore alternatives or just slam breaks and postpone the decision to acquire PLM systems. In other words, if uber cloud PLM taxi is so expensive, I can take a bus.
What can make a difference is actually cloud PLM technologies. Today cloud is a buzzword used by all PLM vendors. But, as I mentioned earlier, the type of architecture and the way it uses resources can make a difference. When you host traditional PLM products on IaaS platforms you can get a hit of resources utilization. Cloud was designed for sharing of resources and not for having database server to sit in the cloud underutilized.
What is my conclusion? Multi-tenant architectures and resource sharing can make a difference for future PLM technologies. This is where born in the cloud PLM will be able outperform existing single tenant hosted systems. The next question – will manufacturing companies move to the cloud to optimize their IT and software cost? This is a very good question to ask. Just my thoughts…
Best, Oleg
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