I want to discuss today what is a potential new playbook for SaaS, AI, and the future of engineering platforms for PTC.
I’ve been following PTC’s moves for many years, and every once in a while, the company makes a decision that signals something deeper than what we see in the press releases. The recent sale of ThingWorx and Kepware is one of those moments. On the surface, it looks like a step back from industrial IoT, especially after a decade of heavy investment in platforms, analytics, edge connectivity, and the vision of connected factories. Many analysts read it exactly this way. You can check some of their articles – PTC’s IoT dream ends with sale of ThingWorx and Kepware. But speaking about new “tech-trend following,” while I agree that the IoT trend has been replaced by a massive AI wave, I see PTC at an interesting intersection — with an intriguing opportunity that isn’t just about chasing the next trend.
If you look more carefully, the move points to a sharper and more focused PTC, one that is choosing to bet on its engineering, lifecycle, cloud, and (of course) AI future. This shift raises an important question. If PTC is no longer aiming to be an IoT platform company, then what should it build or buy next? And even more interesting: in a decade that will be shaped by data first, manufacturing networks, AI-native PLM architectures, modern data modeling, and digital thread intelligence, where should PTC place its next strategic bets?
That’s what I want to explore in this article.
A Post-IoT PTC: What Comes Next?
PTC’s move to sell its IoT and connectivity assets isn’t simply a correction. It represents a certain maturation of their digital thread strategy. A decade ago, the thinking was simple: to own the digital thread, a vendor needed to own the IoT platform that streams data from machines and assets. Ten years later, the market has taught us that IoT platforms by themselves don’t create lifecycle value unless they are deeply connected to engineering and service data. Most IoT projects stayed isolated or became integration-heavy science experiments.
In other words, IoT without a deep lifecycle context is just telemetry.
PTC seems to be acknowledging this by refocusing on the engineering core: CAD, PLM, SaaS platforms, ALM, and service lifecycle. The question now is not how to collect more machine data, but how to contextualize the data companies already have and turn it into intelligence that supports design, manufacturing, service, and supply chain.
This shift also suggests that the next decade of PLM will look very different from the last one. I expect it to be defined by multi-tenant data models, continuous context building, flexible relationships between lifecycle elements, and AI systems that sit on top of clean and well-managed information. PLM is getting ready to evolve from document workflows and siloed systems to something more integrated and intelligent.
What the Divestment Really Signals: A Cleaner, Sharper Strategy
As I think about PTC’s trajectory, I see three big shifts that explain why selling ThingWorx and Kepware actually sets the stage for a new kind of platform.
The first shift is from OT data to engineering lifecycle data. For years, the PLM industry chased the dream of connecting sensors and machines directly to engineering processes. While interesting, the complexity, cost, and fragmentation of IoT implementations slowed everything down. The new focus seems much more pragmatic. Instead of owning connectivity protocols and gateways, PTC can focus on unifying design, manufacturing, and service data (data first). This type of data is already clean, structured, and deeply relevant to product lifecycle decisions.
The second shift is the renewed push toward SaaS-first platforms, including Onshape and the SaaS versions of Windchill and Creo. PTC’s original plan was to “SaaSify” the portfolio by 2025. Some progress was made, but the vision needs a refresh.
I found the confirmation of PTC commitment to the Unified SaaS portfolio on their website:
What’s emerging now is a realization that SaaS isn’t only about hosting software in the cloud. It is about introducing new data architectures that were not possible in the old PLM era. Multi-tenant storage, instant collaboration, flexible data schemas, and cloud-native extensibility all become part of the picture. Onshape already brought some of these qualities into PTC’s portfolio. The question is how to expand them across the entire platform.
The third shift is the rise of AI as the next competitive frontier. Everyone in the PLM market talks about AI, but there is still a gap between the slogans and what engineering teams actually need. The real opportunity is not generic AI tools but intelligence embedded inside engineering workflows: design assistants and review, simulation helpers, change-impact systems, and automated lifecycle insights. PTC has a unique advantage here because it owns assets like Onshape that were built around modern multi-tenant architectures, plus Windchill and Creo where deep institutional knowledge exists. With the right data foundation, PTC could make AI something more practical than what most PLM vendors are promising.
Four Market Domains PTC Must Address (A–D)
Thinking about the next step for PTC means looking across a few domains where the company can create the most influence. I see four important areas, each with different market dynamics and opportunities.
A — AI-Augmented Engineering and Lifecycle Intelligence
This is the top priority. AI will reshape every part of the engineering process. It will change how engineers design, review, validate, simulate, collaborate, manage BOMs, prepare data for manufacturing, and release revisions. This market alone could exceed $20–30B in the next decade. However, AI is only as useful as the data it sits on. Without a clean, connected, contextualized data and lifecycle model, AI turns into clever chat demos.
The biggest competitive advantage in PLM over the next decade will not be CAD or even PLM features by themselves. It will be the ability to build an AI-ready data foundation, make PLM data ready for AI and provide AI-native lifecycle intelligence, powered by a modern, connected data model. This is something legacy architectures simply cannot do well. It’s where PTC has an opportunity to leap ahead.
B — Digital Transformation for SMB Manufacturers
This is my second priority, and for a good reason. SMB manufacturing is the largest-volume market in the world. While enterprise PLM gets most of the headlines, SMBs represent the biggest opportunity for growth. They need cloud-native, simple-to-deploy, multi-tenant tools that connect CAD, BOMs, suppliers, and ERP. Many SMBs still operate with spreadsheets and email threads, which means they are one step away from adopting lightweight, modern, SaaS-native lifecycle tools.
Onshape already gave PTC a strong entry point into this segment. However, the PTC Onshape strategy needs a boost, and it’s unlikely to come from simply combining the two Velocity products (Onshape + Arena). Their main competitor, SolidWorks—although troubled by 3DX issues—remains very strong, and the five years since the Onshape acquisition make me think that PTC needs to empower Onshape much more if they want to win over SolidWorks customers.
In my view, to win the SMB digital transformation market, PTC needs a more complete lifecycle platform. It needs cloud PDM option, simple multi-disciplinary BOM collaboration, supplier and ERP integration, and automation. This is a fast-moving category, and the companies that solve it will see very strong adoption.
C — Multi-Domain Lifecycle, MBSE and Systems Engineering
The third domain is multi-domain and model-based lifecycle management. Products are getting more complex. A modern device blends mechanical components, electronics, software, firmware, connectivity, and service logic. PLM must integrate all of these elements into one lifecycle. PTC already made some progress with ALM and model integration, but there is more to do before mechanical, electrical, and software development live inside the same connected platform.
The opportunity here lies in providing unified multi-domain data, traceability, configuration, and model-based workflows. This area is important for aerospace, automotive, robotics, and medical devices. It is not the largest overall market, but it is a high-value one and fits well with PTC’s long-term direction.
D — Interoperability, Supply Chain Collaboration, and Manufacturing Readiness
The final domain becomes especially relevant after PTC decided to exit the IoT arena. Manufacturers today need cross-company workflows more than ever. They need to connect engineering with suppliers, share BOMs with contract manufacturers, exchange cost and sourcing data, and integrate PLM with ERP and MRP systems. This is not the glamorous part of digital transformation, but it is the foundation of the digital thread.
Interoperability, supplier collaboration, and manufacturing readiness are all essential as PTC expands its SaaS PLM offering. These capabilities usually don’t represent large standalone revenue streams, but without them, no cloud PLM can scale across an extended enterprise. This is the plumbing layer that makes the digital thread real.
Priority Order Explained: Why A > B > C > D
When I look at the market and at PTC’s portfolio, I see a clear order of priorities.
AI-native engineering platforms should come first. AI amplifies every part of PTC’s offering. It connects CAD, PLM, ALM, SLM, and service into one intelligent lifecycle. It is the largest market opportunity, and it is the strongest differentiation point for the next decade. Companies that build an AI foundation into their lifecycle platforms will define the future of PLM. However, PTC must be careful to “bolt-on” some AI solution without going strong on a data foundation.
SMB digital transformation comes next. It is the fastest-growing and highest-volume opportunity. It also fits naturally with multi-tenant SaaS architectures, making it ideal for a modern cloud strategy. Onshape gives PTC a strong foothold, but the platform needs additional layers to cover PDM, BOMs, contractor, ERP-integrations, manufacturing, and service.
Multi-domain lifecycle management comes third. It is important for enterprise customers and regulated industries. It anchors PTC’s enterprise credibility and supports long-term systems engineering trends. Combined with AI, this domain can offer powerful cross-disciplinary capabilities.
Interoperability and supply chain collaboration come last, but not because they are unimportant. They are the connective tissue for everything else. They are the infrastructure layer that turns engineering designs into manufacturable and serviceable products. But they are best delivered as part of a broader lifecycle platform rather than a standalone market.
The Missing Layer: A Modern Lifecycle Data Platform
As PTC thinks about where to go next, I believe the missing piece is a modern lifecycle data platform. Traditional PLM architectures were never built to be multi-tenant (Onshape acquisition was a strong sign PTC understood the weakness of old architecture PLM hosting). They were built for on-premise deployments, document control, and complex customizations. Even with cloud hosting, the core data models remain rigid, SQL schema-bound, and siloed.
The next generation of lifecycle platforms needs a very different foundation. It requires a multi-tenant data fabric, flexible schemas, xBOM online services, graph-based relationships, granular permissions, and contextualized data that can fuel AI. It must support cross-company collaboration and real-time data sharing. It must be API-first, extensible, and able to integrate with ERP, MRP, and supply chain tools without heavy customization.
PTC already made an important step in this direction by acquiring a cloud-native data management platform (Onshape). The architecture behind it introduced many of the principles that PLM platforms will need going forward. But to fully leverage this advantage, PTC will need to expand and extend this architecture. It needs to be connected to AI foundations and tailored to SMB digital transformation. And it needs to serve as the backbone for lifecycle intelligence, not only CAD data.
This is where I see PTC’s biggest opportunity. Building or acquiring capabilities that align with this modern lifecycle platform vision will allow the company to stay ahead of competitors and define a new category in PLM.
What PTC Should Buy or Build Next
To deliver on this strategy, PTC should look across several categories. I’m thinking here about needs rather than vendors. PTC should explore AI engineering assistants that help design, simulate, validate, and manage changes across disciplines. They will need cloud-native PLM and digital thread platforms that embrace multi-tenant data, flexible schemas, and lifecycle intelligence. Data interoperability layers are essential for connecting engineering with ERP, MRP, and supply chain systems.
There is also a growing need for vertical and SMB-focused SaaS engineering and manufacturing solutions. These are the systems that solve the everyday problems of midsize manufacturers: BOM management, cost and sourcing workflows, compliance, supplier collaboration, and manufacturing readiness.
On the multi-domain side, PTC could benefit from systems modeling and MBSE capabilities. As products become more integrated, the ability to connect models, requirements, and configurations becomes essential. Knowledge graph or semantic lifecycle tools could also accelerate the move toward a connected digital thread.
And finally, lightweight ERP/MRP connectors and cloud-native configuration and change engines will be needed to support the breadth of workflows from design to manufacturing.
What is my conclusion? — The Next Phase of PTC’s Transformation
As I look at PTC’s strategic position after the IoT divestment, I don’t see a retreat. I see clarity. The future of PLM is no longer about owning gateways and edge devices. It is about owning the data and the intelligence that sits at the center of product development, manufacturing, and service. The next decade will belong to vendors that build AI-enablers and multi-tenant, data-first lifecycle platforms. These platforms will connect engineering, manufacturing, and supply chain into a single coherent digital thread.
PTC has a chance to lead this transformation. The company has the portfolio, the market reach, and the engineering depth to execute on this vision. But to do so, it must invest in the foundational architecture that will support AI, collaboration, and SMB growth. This strategy will allow PTC to expand its enterprise footprint and, equally important, to leap forward into the SMB market where the potential for growth is enormous.
The question is no longer what PTC sold, but what architecture it will build next—and who will shape the next digital thread.
Just my thoughts…
Best, Oleg
Disclaimer: I’m the co-founder and CEO of OpenBOM, a digital-thread platform providing cloud-native collaborative and integration services between engineering tools including PDM, PLM, and ERP capabilities. Interested in OpenBOM AI Beta? Check with me about what is the future of Agentic Engineering Workflows.
With extensive experience in federated CAD-PDM and PLM architecture, I advocate for agile, open product models and cloud technologies in manufacturing. My opinion can be unintentionally biased.
