|  | 2008 market forces
Cambashi analyses AEC Market in Europe, Mideast, Africa
In its latest figures, engineering and enterprise IT applications market research and analysis consultants, Cambashi, estimates that in 2007 the revenues of all disciplines’ engineering applications software providers in the European, Middle East and African (EMEA) region grew 7% to nearly Euro 3.0 Bn. In 2008, Cambashi forecasts similar growth, to over Euro 3.2 Bn.
The engineering applications software market includes tools to assist mechanical, architectural and infrastructure design. Architecture, engineering and construction (AEC) is the fastest growing and second biggest segment of the market. In 2007, it grew 16% to nearly €460m. Cambashi forecasts that, in 2008, it will increase by 11% to around €510m.
Focus on Architecture, Engineering and Construction
Cambashi believes that the market is growing quickly because of two related factors. First, users are beginning to transition from 2D “electronic drawing board” technology to 3D building information modeling (BIM) technology.
Secondly, users in the AEC industry are demanding that the different software tools used by different design disciplines integrate better.
Mike Evans, Director of Research at Cambashi, comments: “With users adopting building and plant modeling, they want a more integrated approach to design. The providers of design and draughting software like Autodesk and Bentley want to provide a more integrated approach for complementary design disciplines such as structural analysis. They are extending their portfolios to include software tools.”
Acquisitions to integrate engineering disciplines
Recently, the biggest software developers in the AEC space have acquired niche applications software developers that develop tools for complementary engineering disciplines. They understand the need for seamless data integration to help users obtain benefits from BIM.
Cambashi’s research suggests that many users already have multiple design tools available on their desktops. The challenge for users in the next few years will be to decide the balance between a best of breed and a single integrated supplier strategy.
Autodesk – Pervasive technology, executing well
In 2007, Autodesk’s AEC software revenues, which include building and civil, but exclude the use of AutoCAD and AutoCAD LT in AEC, grew by 18% to €94m. In 2008, Cambashi predicts growth of over 25% to €120m.
The 3D products, Revit and Civil3D, with their increased focus on BIM are generating this spectacular growth. Recent acquisitions of complementary technologies, like ROBOBAT (France) and NavisWorks (UK) will generate further growth.
Bentley - Building relationships
In 2007, Cambashi estimates that Bentley generated around €103m in AEC revenues including building, civil and plant applications. In 2008, Cambashi forecasts that revenue will grow 8%.
This figure is not directly comparable with Autodesk’s as the two companies have divergent business models. Bentley increasingly is building direct relationships with its larger users, with a subscription priced on an estimate of the enterprise’s overall use. Autodesk primarily sells units of software via resellers though they too are introducing subscriptions at the per user level.
Bentley has an aggressive acquisition strategy to extend its portfolio in complementary technologies. Already in 2008 it announced three acquisitions: ECT promise and Hevacomp in the UK; and LEAP Software in the USA. These add components such as electrical and heating, ventilation and air conditioning (HVAC) to the building information modeling platform.
Nemetschek – Central European champion
Nemetschek, with AEC revenues of over €121m for 2007, is the largest European-based AEC competitor to Autodesk and Bentley. Following the early 2006 acquisition of Graphisoft, based in Hungary, revenue in EMEA grew 38% in 2007. In 2008, Cambashi predicts growth of around 8%.
Nemetschek has also made a series of niche developer acquisitions over the past few years to add structural steel and civil engineering applications to its portfolio. SCIA International (Belgium) is an example of this.
AVEVA – pushing for plant leadership
In 2007, AVEVA, the UK-based plant and marine specialist, grew 18% to revenues of over €72m. In 2008, Cambashi expects growth of around 6%.
Growth outside EMEA is even faster and AVEVA’s results have consistently exceeded expectations.
The high oil price is generating new investment in plant hence creating demand for plant design software. The well judged acquisition of Tribon (Sweden) in marine engineering and shipbuilding and continuous expansion of the product portfolio into areas like commissioning combine to position AVEVA to satisfy changing demand. AVEVA maintains an active interest in further acquisitions.
Intergraph PPM – Quietly private force
Cambashi estimates that Intergraph PPM, now a private company acquired by Hellman & Friedman and Texas Pacific Group in 2006, had EMEA revenues of €47m in 2007. In 2008, Cambashi forecasts growth of around 5%.
Cambashi regards Intergraph PPM as a continuing force in plant and marine, especially in utilities. Out of the public gaze Cambashi believes it is focusing on maximizing profitability rather than chasing after growth. |
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