November 17, 2003
Off Again
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Jeff Rowe - Managing Editor

by Jeff Rowe - Contributing Editor
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Offshore outsourcing is not without issues including potential loss of Intellectual Property assets, impact on morale and productivity of remaining US workers, and difficulty of managing remote operations in different cultures. There are also political and economic consequences for the US as a whole. What happens if the US winds up losing its technological edge? Will the US tax base be further gutted as well-compensated US technology professionals lose their jobs? "Outsourcing solely to lower costs because one's competition is doing it" displays a lack of imagination.

What will be the impact on MCAD vendors, if large numbers of mechanical engineering and design jobs move overseas? What price can be commanded for MCAD products, when end users offshore are being a paid a third the salary of US and European engineers? Will CAD vendors themselves look to capitalize on lower cost software talent overseas? In July PTC signed a 39 month outsourcing software development deal with ITC Infotech worth an estimated $54M.

It's All In The Name

EDS announced its PLM Solutions business has changed its name to UGS PLM Solutions, effective immediately. UGS PLM Solutions expects its new name and logo will start appearing in marketing collateral the next few weeks.

UGS PLM Solutions provides product lifecycle management (PLM) software and related services to approximately 41,000 customers. In 2002, UGS PLM Solutions reported US$879 million in revenue and US$138 million in operating profit. The company's new name combines two key elements. UGS represents a well- known brand in the PLM space. PLM Solutions represents the family of companies -- including the former operations of Structural Dynamics Research Corporation (SDRC), Engineering Animation Inc. (EAI), the MCAD business of Intergraph and UGS -- now fused together into one.

UGS PLM Solutions selected its new name and logo after conducting an analysis of its brand and seeking out and reviewing feedback from customers, employees, and other parties.

"The name and logo of the new UGS PLM Solutions capture the natural evolution of our business and reflect what we do best today -- help clients transform their process of innovation," said Tony Affuso, president and CEO of UGS PLM Solutions. "The UGS part of our new name symbolizes the stability and strength we represent in the PLM space as the industry continues to change."

"At the same time, the PLM Solutions part of the name represents both our heritage and our direction and expanded focus. Together, the two components of our name serve as a metaphor for the evolution of the PLM industry, which has evolved from one focused on product design to one also enabling product data management and collaboration," Affuso said.

I'm all for name changes that clarify the position and direction of a company, but I'm having a bit of trouble comprehending exactly what the advantages and implications are that this name change provides. It's now pretty common knowledge that EDS would like to spin off and/or partner (on a minority basis) with someone to partially acquire its CAD/CAM business, and this name change may be a step in that direction.

Jeffrey Rowe is the editor and publisher of MCADCafi and MCAD Weekly Review. He can be reached at
Email Contact or 408.850.9230.

Letters To The Editor

This week we received feedback to last week's Letter To The Editor regarding the Commentary entitled "The Spatial Versus Autodesk Lawsuit -- Was Justice Truly Served?"

With respect to the comments made by Michael Koehler of Propulsor Technology Inc.

I am very surprised to see such an ill-informed comment published! Mr. Koehler states that both solid kernels are held by the same company that markets its own system. Wrong! Dassault, by virtue of Spatial Systems, owns ACIS, but it doesn't own the kernel they use in SolidWorks, that is, Parasolid, which it uses by license.

Furthermore, none of these kernels are proprietary, but are freely available by license to anybody wishing to develop companion technology. Therefore, the analogy with Microsoft applications is erroneous.

Any CAD system can freely choose its kernel, but it is the implementation of that component within an overall environment that delivers the various competitive advantages. Anybody taking the time to do a quick overview of the history of CAD, can see the evolution from proprietary systems to commodity, open systems, and it is a commercial impossibility to reverse that trend. The sheer number of available systems and the comparatively small number of underlying architectures already refutes the Mr. Koehler's conspiracy theory!

If it is market monopolization that Mr. Koehler fears, more discrimination of the antics of Autodesk would be a far more revealing study.
    Lorna McLachlan

    Sales Engineer

    Intercad Pty Ltd.

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