Cloud-Based CAD — The Predictions and the Reality9 Jun, 2015 By: Robert Green
CAD Manager Column: A recent survey by the Business Advantage Group highlights the gap between forecasts and real-world adoption rates.
Several of the CAD management sessions I've taught recently have spawned extended conversations about cloud-based CAD technology adoption, and I've been quite surprised by how negatively my colleagues feel about cloud-based systems. Coincidentally, I also received a news release from the Business Advantage Group at about the same time, announcing the release of results from its Worldwide CAD Trends 2015 survey that delved into some very interesting statistics about CAD in the cloud.
In this edition of the CAD Manager’s Newsletter, I'll discuss some of the statistics presented in the survey and provide some conclusions based on my conversations with CAD managers.
What Does the Survey Data Reveal?
For the purposes of the survey, Business Advantage Group used this description of cloud-based CAD: "Rather than software being deployed and used locally, cloud-based solutions enable the software to be loaded and run somewhere else, but be accessible anywhere with an Internet connection." (This definition will be important to consider in an upcoming section, so keep it in mind as you read the survey results.)
In the graphic you see below, the actual usage of cloud-based CAD systems is broken down by AEC and manufacturing industry segments for the past two years, and then in terms of forecasted usage over the next two years. The extremely low adoption rate — 7% and 8% in 2014 and 2015, respectively — is generally representative of what I see in the field with my clients.
Hopping forward to the forecasted usage in the next year shows a large jump in usage, with 3–5 year projections showing more moderate, but still substantial, growth. It's important to note that the survey states that forecasted CAD-in-the-cloud usage statistics are derived from asking 635 engineers, designers, and general software users their opinions — not by compiling data from IT/engineering/CAD management personnel, who are more likely to influence actual implementation.
Seeing the forecasts for cloud-based CAD usage in this study made me wonder about the forecasts for past years. According to the survey results, growth for cloud-based CAD did not meet predictions last year:
The 100%+ growth predicted last year was not achieved in 2014 and this held true across all sectors. Cloud-based CAD has seen low overall growth during the past year (7% to 8%). However, there were significant differences in growth across sectors. The AEC sector saw 22% growth over last year (usage increased from 9% to 11%) whilst manufacturing did not show any change over the previous year.
Another way to put this is that the same companies that predicted a doubling in growth of cloud-based CAD tools only saw an 11% increase at best — with many experiencing less than that. This makes me wonder how much growth will actually be seen in coming years. (I suspect it will be much lower than forecast.)
Why the Disconnect?
The survey spelled out some additional data points and conclusions that are very telling about why the predicted adoption of cloud-based CAD has been higher than the actual adoption rate:
Awareness: Cloud-based CAD has "high awareness" (51%) among CAD users, managers, and executives, and offers new business and delivery models for CAD, CAM, CAE, product data management (PDM), and product lifecycle management (PLM) software companies.
Importance: Compared to a number of the other trends, cloud-based CAD earned a relatively low importance ranking (with a mean score of 4 out of 10). This may indicate that sufficient return on investment isn't yet obvious to all users. Importance varies by sector, with AEC users rating this trend at 4.3 out of 10 and manufacturing users rating it at 3.7 out of 10. At the present time, cloud-based CAD appears to be more important to AEC users, where the greater need for "mobility" within the AEC sector contributes to the higher importance rating.
Perceived benefits: The top perceived benefits and productivity changes over all sectors are higher mobility (66%), ease of updating software (45%), cost reductions (39%), and increased storage capability (31%), but these vary considerably by sector. For example, higher mobility scored 74% in AEC and 58% in manufacturing, cost reductions scored 28% in AEC and 49% in manufacturing, and increased storage capability scored 38% in AEC and 16% in manufacturing.
Who benefits: The survey conclusions state that "It is not yet obvious whether this trend will best serve users or software companies wanting to switch users to subscription-based revenue models."