A year ago, when I was planning my PLM (product lifecycle management) coverage for 2007, I envisioned something similar to the tale of David and Goliath. I'd look at how the smaller vendors and relative newcomers were grabbing market shares from the industry titans by catering to the underserved manufacturing communities. I had even sketched out my plot, pitting affordable, on-demand solution providers such as Arena and Agile against the big three: Dassault Systemes, PTC, and Siemens PLM (formerly UGS).

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Surveying the battlefield, however, I have come to realize the dynamics of the campaigns have changed. The big three have spawned their own versions of David to penetrate the small and midsize businesses (SMBs). Two of them — Dassault and PTC — are brandishing their own on-demand and software-as-a-service (SaaS) products. So I'm updating my script. It isn't about David and Goliath. It's about the giants that are learning to be nimbler, gentler, and friendlier to the little guys that can help or hurt their bottom lines.

The New Battlefield

With a sizable IT budget and a large resource pool, a Fortune 500 company may be willing to tolerate — or even prefer — a lengthy, tailor-made PLM implementation that can be refined and perfected over several years. But money and time are luxuries the SMBs don't have. They're likely to find software implementations that cost less and promise a quick return on the investment more appealing. For the speed gain and affordability, they may even be willing to put up with some minor limitations (an interface that's less than ideal for their industry-specific needs, for example). Consequently, when on-demand PLM vendors such as Arena Solutions and Agile appeared on the scene, SMBs were delighted.

It wasn't long before the big three in PLM realized they were missing out. Now, each has come out with its own SMB bundle. The emphasis is on speed, as apparent in the names and the marketing literature: CATIA PLM Express from Dassault; Quick, Easy, Affordable PLM from PTC; and UGS Velocity Series from Siemens PLM.

Agile has been acquired by another giant. Not a PLM giant but an enterprise software giant: Oracle. Oracle and SAP (Oracle's nemesis) have been inching toward the PLM market for some time now, and each has its own PLM package. With Agile safely tucked in its pocket, Oracle has an affordable product to pitch to the SMB crowd. However, it's unclear whether that's Oracle's target market. During the Oracle OpenWorld conference in November, the company announced that Agile, now rebranded as Oracle's Agile Enterprise PLM, is "being designed to be extended through open, standard-based [application integration architecture] to different enterprise components such as manufacturing and shop floor capabilities, ERP applications, supply-chain planning functionality . . ." Oracle's press office didn't respond to inquiries on the fate of the pre-existing Agile Advantage program, aimed at SMBs or Agile OnDemand.

Testing the Water with On Demand