PTC’s recent $112 million acquisition of ThingWorx steers it directly into the path of the Internet of Things (IoT), an era where increasingly smart and connected products generate real-time operational data streams that can be captured and analyzed to fuel innovation and generate new revenue streams.
ThingWorx is an early-stage company delivering a platform that enables companies to build and run applications for monitoring, maintaining, and operating products. Using the ThingWorx platform, companies in such industries as oil and gas and manufacturing are developing IoT applications that track the flow of products or physical assets through the factory, manage the performance of individual machines or systems in the field, as well as monitor systems and products as part of a predictive maintenance strategy.
Pundits and industry analysts are bullish on the potential of the IoT, heralding the technology as a disruptive force that can spawn a new era in manufacturing and business productivity. According to May report from McKinsey Global Institute called, “Disruptive Technologies: Advances that will transform, life, business, and the global economy,” IoT is among the top 12 disruptive technologies, with the potential to connect up to 1 trillion things across industries such as manufacturing, health care, and mining, including 100 million global machine to machine (M2M) device connections across sectors like transportation, security, health care, and utilities.
With expectations that between 80% to 100% of manufacturers will be leveraging the Internet of Things by 2025, McKinsey Global Institute predicts the technology could have a potential economic impact of $2.7 trillion to $6.2 trillion annually in that timeframe.
PTC sees the IoT and specifically, the ThingWorx technology, fitting squarely into its vision around Service Lifecycle Management (SLM) and Product Lifecycle Management (PLM). PTC President and CEO Jim Heppelmann called improved service strategies and service delivery the near-term “killer app” for the IoT and a natural complement to its own vision.
“Our mission is to provide technology solutions that transform the way products are created and serviced,” he said. “As smart products gain an IP address and wireless capabilities, there is an explosion of possibilities as service and operational information can be gathered and put to use in real time.”
For example, as part of its SLM vision, PTC sees a world where manufacturers create applications for delivering proactive service, keeping a piece of industrial equipment or an aircraft operating flawlessly rather than having to initiate repairs after the fact, Heppelmann explained. From the PLM standpoint, this real-time operational data could help engineers better understand product quality and reliability, helping to drive more innovative designs while improving manufacturing efficiencies, he added.
Prior to the ThingWorx acquisition, PTC was moving quickly down the IoT path. The company had an active internal R&D effort codenamed “Jolt,” which was a concept for a “Product Cloud” where products could be remotely monitored in real time, drawing on the usage information and service needs to trigger proactive service events.
PTC’s Product Cloud “would provide a means by which these smart products could connect to a shared cloud that would contain business applications that monitor their sensor data streams for service-related needs and events, control the products remotely, and even maintain their software versions as software bugs were addressed or security features added,” Heppelmann explained. “Product Cloud will add a new dimension of capabilities to our SLM apps in the form of proactive service capabilities, to our ALM (application lifecycle management) apps in the form of remote software management and distribution, and to our PLM apps in terms of real-time quality monitoring and analysis.”
While the internal PTC team was hard at work on Project Jolt, PTC happened upon ThingWorx, which was pursuing a similar concept, but was much further along. “By acquiring the ThingWorx company, we have accelerated our time to market for this exciting concept by several years and have secured a strong leadership position,” Heppelmann explained.
The Jolt project is getting merged into the ThingWorx organization so there is a single effort focused on the IoT. PTC will also begin selling the ThingWorx existing rapid application platform this quarter and will work in parallel to integrate ThingWorx into its existing SLM and PLM suites.
In this video, ThingWorx CEO Russ Fadel provides a basic backgrounder on the company along with his vision for the Internet of Things and the ThingWorx technology.