DataQuest

DataQuest

DataQuest

n n a company of

MMMM TheDun&BradstreetCorporatK

February 13, 1986

CAD/C3iM INDUSTRY SERVICE

FILING INSTRUCTIONS

TITLE:

PUBLICATION TYPE:

MARKETS AND ANALYSES BINDER

New Binder

TITLE:

PUBLICATION TYPE:

PAGES;

FILING INSTRUCTIONS:

IOTI«>DUCTIC»J TO THE SERVICE

Tab

T h i s t a b i s now i n y o u r Volume I b i n d e r a n d

s h o u l d be moved t o t h e new Market a n d

A n a l y s e s b i n d e r .

TITLE:

PUBLICATION TYPE:

PAGES:

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INTRODUCTION TO THE SERVICE

S e r v i c e S e c t i o n

18

This service section dated 1 July, 1986, is now in your Volume I binder. It should now be moved to your Market and Analyses binder directly behind the Introduction to the

Service tab.

1290 Ridder Park Drive, San Jose, CA 95131-2398, (408) 971-9000 Telex 171973

Filing Instructions

February 13, 1986

Page 2

TITLE:

PUBLICATION TYPE:

PAGES:

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TABLE OF CONTENTS

Tab

1

The Table of Contents tab is now in your

Volume I binder, and should be moved to your Market and Analyses binder and filed directly behind the Introduction to the

Service, section.

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TABLE OF CONTENTS

Service Section

8

This service section dated 15 Jan. 1986 should be filed in the Market and Analyses binder directly behind the Table of

Contents tab. The Table of Contents dated

24 Aug. 1984 should now be discarded.

TITLE:

PUBLICATION TYPE:

PPtGESi

FILING INSTRUCTIONS:

1 INDUSTRY OVERVIEW

Tab

1

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Contents, dated 15 Jan. 1986.

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AUTHOR:

1.1 INDUSTRY OVERVIEW

Service Section

6

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1986 in your Market and Analyses binder, directly behind the the 1 Industry Overview tab.

David Burdick

Piling Instructions

February 13, 1986

Page 3

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AUTHOR:

1.2 APPLICATION OVERVIEW

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d

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1986 in the Market and Analyses binder directly behind the 1.1 Industry Overview section dated 15 Jan. 1986.

David Burdick

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1.3 GEOGRAPHICAL OVERVIEW

Service Section

18

Pile this section dated 15 Jan. 1986, in the Market and Analyses binder directly behind the 1.2 Application Overview section dated 15 Jan. 1986.

David Burdick

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1.4 PRODUCT TYPE OVERVIEW

Service Section

10

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David Burdick

TITLE:

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2 MECHANICAL APPLICATIONS

Tab

Filing Instructions

February 13, 1986

Page 4

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Overview section dated 15 Jan. 1986.

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PAGES:

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AUTHOR;

2.1 MECHANICAL DEFINITIONS

Service Section

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1986 in the Market and Analyses binder directly behind the 2 Mechanical

Applications tab.

Mike Seely

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2.2 MECHANICAL EXECUTIVE SUMMARY

Service Section

2

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1986 in the Market and Analyses binder directly behind the 2.1 Mechanical

Definitions section dated 15 Jan. 1986.

Mike Seely

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2.3 MECHANICAL MARKET OVERVIEW

Service Section

10

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1986 in the Market and Analyses binder directly behind the 2.2 Mechanical

Executive Summary section dated 15 Jan.

1986.

Mike Seely

Filing Instructions

February 13, 1986

Page 5

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2.4.1 TOTAL MECHANICAL CAD/CAM

Service Section

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1986 in the Market and Analyses binder directly behind the 2.3 Mechanical Market

Overview section dated 15 Jan. 1986.

Mike Seely

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AUTHOR:

2.4.2 MECHANICAL MARKET SHARE

Service Section

4

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1986 in the Market and Analyses binder directly behind the 2.4.1 Total Mechanical

CAD/CAM section dated 15 Jan. 1986.

Mike Seely

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AUTHOR:

2.4.3 MECHANICAL REGIONS

Service Section

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1986 in the Market and Analyses binder directly behind the 2.4.2 Mechanical Market

Share section dated 15 Jan. 1986.

Mike Seely

TITLE:

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2.4.4 MECHANICAL PRODUCT TYPE

Service Section

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February 13, 1986

Page 6

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FILING INSTRUCTIONS:

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File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 2.4.3 Mechanical

Regions section dated 15 Jan. 1986.

Mike Seely

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3 AEC APPLICATIONS

Tab

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Product Type section dated 15 Jan. 1986.

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3.1 AEC DEFINITIONS

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Mike Seely

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3.2 AEC EXECUTIVE SOM*ARY

Service Section

2

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1986 in the Market and Analyses binder directly behind the 3.1 AEC Definitions section dated 15 Jan. 1986.

Mike Seely

Filing Instructions

February 13, 1986

Page 7

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AUTHOR:

3.3 AEC MARKET OVERVIEW

Service Section

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 3.2 AEC Executive

Suimiiary

section dated 15 Jan. 1986.

Mike Seely

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AUTHOR:

3.4.1 TOTAL AEC CAD/CAM

Service Section

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1986 in the Market and Analyses binder directly behind the 3.3 AEC Market Overview section dated 15 Jan. 1986.

Mike Seely

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AUTHOR:

3.4.2 AEC MARKET SHARE

Service Section

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1986 in the Market and Analyses binder directly behind the 3.4.1 Total AEC CAD/CAM section dated 15 Jan. 1986.

Mike Seely

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3.4.3 AEC REGIONS

Service Section

Filing Instructions

February 13, 1986

Page 8

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FILING INSTRUCTIONS:

AUTHOR:

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 3.4.2 AEC Market Share section dated 15 Jan. 1986.

Mike Seely

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3.4.4 AEC PRODUCT TYPE

Service Section

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1986 in the Market and Analyses binder directly behind the 3.4.3 AEC Regions section dated 15 Jan. 1986.

Mike Seely

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4 MAPPING APPLICATIONS

Tab

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Product Type section dated 15 Jan. 1986.

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4.1 MAPPING DEFINIT1C»IS

Service Section

2

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1986 in the Market and Analyses binder directly behind the 4 Happing Applications tab.

Eileen Barth-Lynch

Piling Instructions

February 13, 1986

Page 9

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PASES:

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4.2 MAPPIira EXECUTIVE SOJBIARY

Service Section

hWrnORi

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1986 in the Market and Analyses binder directly behind the 4.1 Mapping Definitions section dated 15 Jan. 1986.

E i l e e n B a r t h - L y n c h

TITLE:

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PAGES:

FILING INSTRDCTIONS:

4.3 MAPPING MARKET OVERVIEW

Service Section

AUTHOR:

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 4.2 Mapping Executive

Summary section dated 15 Jan. 1986.

Eileen Barth-Lynch

TITLE:

PUBLiChriM T£Pt:-''

PAGES:

PILING INSTRUCTIONS:

4.4.1 TOTAL MAPPING CAD/CAM

Service Section

AUTHOR:

Pile this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 4.3 Mapping Market

Overview section dated 15 Jan. 1986.

Eileen Barth-Lynch

TITLE:

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4.4.2 MAPPING MARKET SHARE

Service Section

Filing Instructions

February 13, 1986

Page 10

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FILING INSTMJCTIONS:

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1986 in the Market and Analyses binder directly t}ehind the 4.4.1 Total Mapping

CAD/CAM section dated 15 Jan. 1986.

Eileen Barth-Lynch

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AUTHOR:

4.4.3 MAPPING REGIONS

Service Section

6

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1986 in the Market and Analyses binder directly behind the 4.4.2 Mapping Market

Share section dated 15 Jan. 1986.

Eileen Barth-Lynch

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4.4.4 MAPPING PRODUCT TYPE

Service Section

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Eileen Barth-Lynch

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5 EDA APPLICATIONS

Tab

1

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Product Types section dated 15 Jan. 1986.

Filing Instructions

February 13, 1986

Page 11

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PAGES:

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5.1 EDA DEFINITICWS

Service Section

2

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1986 in the Market and Analyses binder directly behind the 5 EDA Applications tab.

Beth Tucker

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5 . 2 EDA EXECUTIVE SUMMARY

Service Section

2

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 5.2 EDA Definitions section dated 15 Jan. 1986.

Beth Tucker

TITLE:

PUBLICATION TYPE:

P A G E S : • '•;••-:•'•=

^

'•' •

FILING INSTRUCTICWIS:

AUTHOR:

5.3 EDA MARKET OVERVIEW

Service Section

-10- "'

Pile this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 5.2 EDA Executive

Summary section dated 15 Jan. 1986.

Beth Tucker

TITLE:

PtJBLICATION TYPE:

5.4.1 TOTAL EDA CAD/CAM

Service Section

Filing Instructions

February 13, 1986

Page 12

PAGES;

PILING INSTHDCTIONS:

AUTHOR:

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 5.3 EDA Market Overview section dated 15 Jan. 1986.

Beth Tucker

TITLE:

FILING INSTRUCTIONS!

5.4.2 EDA MARKET SHARE

This service section was not available at the time of publication. It will be sent out as soon as it becomes available.

TITLE:

PUBLICATION TYPE:

5.4.3 EDA REGIONS

Service Section

PAGES:

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AUTHOR:

TITLE:

File this service section dated 15 Jan.

1986 in the Market and Analyse"^< binder directly behind the 5.4.1 Total EDA CAD/CAM section dated 15 Jan. 1986. c -"^

.* r

5E Beth:Tacke-r's -:;'^: •aJ^t^rT:)!'x73|.f, .-"-^uV'

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5.4.4 EDA PRODUCE TYPES

Service Section PUBLICATION TYPE:

PAGES:

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1986 in the Market and Analyses binder directly behind the 5.4.3 EDA Regions section dated 15 Jan. 1986.

AUTHOR:

Beth Tucker

Filing Instructions

February 13, 1986

Page 13

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P2^ES:

FILING INSTRUCTIONS;

6 IC APPLICATIONS

Tab

1

File this tab in the Market and Analyses binder directly behind the 5.4.4 EDA

Product Type section dated 15 Jan. 1986.

TITLE;

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PAGES:

FILING INSTRUCTIONS:

6.1 IC DEFINITIONS

Service Section

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 6 IC Applications tab. v

TITLE:

6.2 IC EXECUTIVE SUMMARY

PUBLICATION, TYPE:

PAt^S: ." .1

Service Section

ii 5

bm -:^ - •

, r ^ :

c'_ E-A- .;. - t

FILING INSTKJCTIONS:

F i l e thi^^i^iser^iee s e c t i o n dated 15 Jan.

1986 in the Market and Analyses binder

d i r e c t l y behind the 6 . 1 IC D e f i n i t i o n s

^YsectidiBi dated 15 J a n . 1986.

AUTHOR;

Beth :Tucker

TITLE:

PUBLICATION TYPE:

PAGES:

FILING INSTRUCTIONS:

AUTHOR:

6.3 IC MARKET OVERVIEW

Service Section

10

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 6.2 IC Executive

Summary section dated 15 Jan. 1986.

Beth Tucker

Filing Instructions

February 13, 1986

Page 14

TITLE:

PUBLICATION TYPE;

PAGES:

FILING INSTRUCTIONS:

AUTHOR:

6.4.1 TOTAL IC CAD/CAM

Service Section

File this service section dated 15 Jan.

1986 in the Marlcet and Analyse binder directly behind the 6.3 IC Marlcet Overview section dated 15 Jan. 1986.

Beth Tucker

TITLE:

PUBLICATION TYPE:

P^ES:

••i ' ~ •

PILING INSTRUCTIONS:

AUTHOR:

6.4.2 IC MARKET SHARE

Service Section

4

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 6.4.1 Total IC CAD/CAM jS^BCtion .dated cl5 Jan. 1986.

Beth Tucker -, .

.• -r.

„,- •-!-,..-., ,-.c.;'.j

TITLE:

PUBLICATION TYPE:

6.4.3 IC REGIONS

.^^Sei:vice Section u.

:£ki(C':70K"^5K3

m^-i^.

PAGES:

FILING INSTRUCTIONS:

AUTHOR:

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 6.4.2 IC Market Share section dated 15 Jan. 1986,,

Beth Tucker

TITLE :•

6.4.4 IC PRODUCT TYPES

Filing Instructions

February 13, 1986

Page 15

POBLICATIOi TYPE:

PACSIS:

FILING INSTBUCTICWS:

AUTHOR:

Service Section

6

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 6.4.3 IC Regions section dated 15 Jan. 1986.

Beth Tucker

TITLE:

PUBLICATION TYPE:

PAGES:

FILING INSTRUCTICaJS:

7 PCB APPLICATIONS

Tab

X

File this tab in the Market and Analyses binder directly behind the 6.4.4 IC Product

Typie section dated 15 Jan. 1986. ^

TITLE:

POBLICATICW TYPE:

PAQBS:

FILING INSTRDCTICaJS:

AUTHOR;

7 . 1 P C B TJEFlNI-rtOMS

S e r v i c e Sefction'-'^"

2 sp^oirtP" :J r ,f .f* •

File this service section dated 15 Jan.

1986i^^in'%he" ifeMcet and Analyses binder directly behind the 7 PCB Applications tab.

Beth Tucker

TITLE: •" ^ ' '

7.2' PCB EXECUTIVE SUMMARY

FILING INSTRUCTIONS:

This service section was not available at the time of publication. it will be sent out as soon as it becomes available.

TITLE;

7.3 PCB MARKET OVERVIEW

F i l i n g I n s t r u c t i o n s

February 1 3 , 1986

Page 16

PUBLICATION TYlPE:

PACSS:

FILING INSTRUCTIONS!

AUTHCHt:

Service S e c t i o n

a

File this service section dated 15 .iJ^n.

1986 in the Market and Analyses binder directly behind the 7.1 PCB Definitions section dated 15 Jan. 1986.

Beth Tucker

TITLE:

-'"'

PUBLICATION TYPE:

PAGES:

FILING INSTRUCTIONS:

AUTHOR:

7.4.1 TOTAL PCe CAD/CAM

Service Section

4

File this service section dated 15 Jan.

1986 in the Market and Analyses binder

•^jfEiePitly, behind the 7.3 PCB Market Overview section dated 15 Jan. 1986.

Beth Tucker " ^ "\ L'

TITLE:

PUBLICATION TYPE:

PAGES:

FILING INSTRUCTlCaJS:

AUTHOR:

7.4.2

IK:B MA^OKE^

SHARE

Service S

rS.r'"T:t;

4

'

• • • " ' ^

'^''-'^

^ c 17;;:);,:,lejq

File .this, service section dated 15 Jan.

1986 ,|n tihe' Market''%na"AftMyses ^binder directly beliiha the 7.4.1 Total PCB CAD/CAM section dated 15 Jan. 1986.

Beth Tucker

TITLE:

PUBLICATION TYPE:

PAGES:

7.4.3 PCB REGIONS

Service Section

6

Filing Instructions

February 13, 1986

Page 17

FILING INSTRDCTIOTIS:

AOfHOftj ; ? ,

• -l .^^ .3

F ' : :

TITLE:

PUBLICATION TYPE:

PASES:

FILING INSTRUCT!d»S!

AUTHOR:

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 7.4.2 PCB Market Share section dated 15 Jan. 1986.

Beth Tucker

7.4.4 PCB PRODUCT TYPES

Service Section

File this service section dated 15 Jan.

1986 in the Market and Analyses binder directly behind the 7.4.3: iPGB Regions section dated 15 Jan. 1986.

Nf

'-'j/^

Beth Tucker

TITLE:

r

PUBLICATION TYPE:

PILING INSTRUCTICWS:

New S p i n e

• - • • • • ' ' • > r T (' ;<-,s

P l e a s e ra&ove t h e s p i n e frora y o u r Volume I

.binder and i n s e r t this new s p i n e .

i •:'./-i:'xfij^ ,';T'-J t '

TITLE:

6^1^st- '•'^'•

PtfBLICATION TYPE:

New S p i n e ''•

' •'^•JPILIMG INSTPUCSIpKSj '^

P l e a s e remove t h e s p i n e ' frem y o u r Volume I I

• • "" Uic''- ,(. ^ T «,.:

birider and I f i S e r t t h i s new s p i n e . i k . , - ^ - ^

8K-

; h ':;^^i/'il*ll^ipig Tnasfoctloivs

i^^-:'- FS^MAVY 1 3 , 1986

• ::r«Vf^pfcpf6'-18 •* .

NOTE . . i - .

P l e a s e i ^ l e t e j f h e f o l l o w i n g Cbrpoi:||^e^Pei^^ tafejis from your

Cocporat:<f(^ Profile;>Si|ider (old Voliai# I ) . Wesare n«i"4iisnfli^ t h e s e (xmpwi\i«i:'''r^"''''^' " -k^'- ^'t - ".^^• • > •

• ' • - . t • -.i' .t-K 'V^V

A p o l l o CoBtputer • . '•'•-'

Data General .'• •

D i g i t a l Bcpi^ip^^nt -

Evans & S u t h e r l a n d

, Gould

. .T H o n e y w e l l

I n f o r m a t i o n D i s p l a y Syst^Bs

I(SI Logic

Pexkin Elmer'

• •• •• VTt : - • ' T^.

'.

CAD/CAM Industry Service

Markets and Analysis

Dataoyest

3Gonipanyof

The Diin&Bradsbeet Corporation

1290 Ridder Park Drive

San Jose, California 95131

(408) 971-9000

Telex: 171973

Fax: (408) 971-9003

Sales/Service offices:

UNITED KINGDOM GERMANY

DATAQUEST UK Limited DATAQUEST GmbH

144/146 New Bond Street Rosenkavalierplatz 17

London WIY 9FD D-8000 Munich 81

United Kingdom West Germany

(01) 409-1427 (089) 91-1064

Tfelex: 266195 Telex: 5218070

Fax: (01) 491-2790 Fax: (089) 91-2189

FRANCE JAPAN

DATAQUEST SARL DATAQUEST Japan, Ltd.

41, rue Ybry Tkiyo Ginza Building

92522 Neuilly-sur-Seine Ced«c 7-14-16 Ginza, Chuo-ku

France Tokyo 104, Japan

(1)47.58.12.40 (03) 546-3191

Tfelex: 630842 Telex: J32768

Fax: (01)46.40.11.23 Fax: (03) 546-3198

The content of this report represents our interpretation and analysis of information generally available to the public or released by responsible individuals in the subject companies, but is not guaranteed as to accuracy or completeness. It does not contain material provided to us in confidence by our clients.

This information is not furnished in connection with a sale or offer to sell securities, or in connection with the solicitation of an offer to buy securities. This firm and its parent and/or their officers, stockholders, or members of their families may, from time to time, have a long or short position in the securities mentioned and may sell or buy such securities.

Printed in the United States of America. All rights reserved. No part of this publication may be reproduced, stored in retrieval systems, or transmitted, in any form or by any means—mechanical, electronic, photocopying, duplicating, microfilming, videotape, or otherwise—without the prior written permission of the publisher.

© 1986 Dataquest Incorporated

Also © 1981, 1982, 1983, 1984, 1985 Dataquest Incorporated

m m

CAD/CAM Industry Service

Volume I

Marketing Analyst's Sourcebook

Dataquest

1290 Ridder Park Drive

San Jose, California 95131

(408) 971-9000

Telex: 171973

Sales/Service offices:

UNITED

K I N G D O M

GERMANY

DATAQUEST UK Limited DATAQUEST GmbH

144/146 New Bond Street In der Schneithohl 17

London WIY 9FD D-6242 Kronberg 2

United Kingdom West Germany

(1) 409-1427 06173/6921-23

Telex: 266195 Tfelex: 410939

FRANCJl JAPAN

DATAQUEST SARL DATAQUEST Japan, Ltd.

' 41 rue Ybry Azabu Heights, Suite 410

92522 Neuilly-sur-Seine Cedex • 1-5-10, Roppongi, Minato-ku

France Tbkyo 106, Japan

(1) 758-1240 (3) 582-1441

Ifelex: 630842 Telex: J32768

The content of this report represents our interpretation and analysis of information generally available to the public or released by responsible individuals in the subject companies, but is not guaranteed as to accuracy or completeness. It does not contain material provided to us in confidence by our clients.

This information is not furnished in connection with a sale or offer to sell securities, or in connection with the solicitation of an offer to buy securities. This firm and its parent and/or their officers, stockholders, or members of their families may, from time to time, have a long or short position in the securities mentioned and may sell or buy such securities.

Printed in the United States of America. All rights reserved. No part of this publication may be reproduced, stored in retrieval systems, or transmitted, in any form or by any means—mechanical, electronic, photocopying, duplicating, microfilming, videotape, or otherwise—without the prior written permission of the publisher.

© 1984 Dataquest Incorporated

Also © 198i, 1982, 1983 Dataquest Incorporated

TABLE OF CONTENTS

CAD/CAM INDUSTRY SERVICE

Markets and Analyses

Title Page

INTRODUCTION T O THE SERVICE*

Need for the Service

Service Structure and Terminology

Service Organization and Coding

Service Features and Procedures

Service Staff

Subscription Terms

TABLE

O F C O N T E N T S

1 INDUSTRY OVERVIEW

L I Market Overview

L2 Application Overview

1.3 Geographical Overview

1.4 Product Type Overview

2 MECHANICAL CAD/CAM APPLICATIONS

2.1 Mechanical Definitions

2.2 Mechanical Executive Summary

2.3 Mechanical Market Overview

2.4.1 Total Mechanical CAD/CAM

2.4.2 Mechanical Market Shares

2.4.3 Mechanical Regions

2.4.4 Mechanical Product Types

3 AEC CAD/CAM APPLICATIONS

3.1 AEC Definitions

3.2 AEC Executive Summary

3.3 AEC Market Overview

3.4.1 Total AEC CAD/CAM

3.4.2 AEC Market Shares

3.4.3 AEC Regions

3.4.4 AEC Product Types

4 MAPPING CAD/CAM APPLICATIONS

4.1 Mapping Definitions

4.2 Mapping Executive Summary

4.3 Mapping Market Overview

4.4.1 Total Mapping CAD/CAM

4.4.2 Mapping Market Shares

4.4.3 Mapping Regions

4.4.4 Mapping Product Types

* Titles in capital letters signify tabs.

CCIS Markets © 1986 Dataquest Incorporated Jan. 15

Table of Contents

CAD/CAM INDUSTRY SERVICE

Markets and Analyses (Continued)

5 EDA CAD/CAM APPLICATIONS*

5.1 EDA Definitions

5.2 EDA Executive Summary

5.3 EDA Market Overview

5.4.1 Total EDA CAD/CAM

5.4.2 EDA Market Shares

5.4.3 EDA Regions

5.4.4 EDA Product Types

6 IC CAD/CAM APPLICATIONS

6.1 IC Definitions

6.2 IC Executive Summary

6.3 IC Market Overview

6.4.1 Total IC CAD/CAM

6.4.2 IC Market Shares

6.4.3 IC Regions

6.4.4 IC Product Types

7 PCB CAD/CAM APPLICATIONS

7.1 PCB Definitions

7.2 PCB Executive Summary

7.3 PCB Market Overview

7.4.1 Total PCB CAD/CAM

7.4.2 PCB Market Shares

7.4.3 PCB Regions

7.4.4 PCB Product Types

' Titles in capital letters signify tabs.

tf ©1986 Dataquest Incorporated Jan. 15 CCIS Markets

Table of Contents

CADlCAM INDUSTRY SERVICE

Corporate Profiles

INTRODUCTION TO CORPORATE PROFILES*

Introduction to Corporate Profiles

Scoreboard

Five Year Overview

1983-1979 Scoreboards

Adage, Inc.

Apollo Computer

AppUcon Incorporated

Auto-trol Technology Corporation

Cadlinc Incorporated

Calma Company

Computervision Corporation

Control Data Corporation

Daisy Systems Corporation

Data General Corporation

Digital Equipment Corporation

Evans & Sutherland Computer Corporation

Gould Inc.

Hewlett-Packard Company

Intergraph Corporation

IBM Corporation

Lexidata Corporation

LSI Logic Corporation

The MacNeal-Schwendler Corporation

McDonnell Douglas Automation Company

Mentor Graphics Corporation

PDA Engineering

Personal CAD Systems, Inc.

Prime Computer Inc.

The Perkin-Elmer Corporation

Racal-Redac Limited

Scientific Calculations, Inc.

Synercom

Tektronix, Inc.

Telesis Systems Corporation

Valid Logic Systems Incorporated

VLSI Technology Incorporated

* Titles in capital letters signify tabs.

CCIS Markets © 1986 Dataquest Incorporated Jan. 15

Table of Contents

CAD/CAM INDUSTRY SERVICE

Data Base

Title Page

VOLUME II - INTRODUCTION*

Introduction to the Sendee

APPENDIX A FORECASTS

Appendix A — Forecasts

A . l Forecasts — All Companies

A. 2 All Standalone Products

A.3 All Host-Dependent Products

A.4 All Personal Computer Products

APPENDIX B MARKET SHARE

Appendix B — Market Share

B.l Market Share — All Companies

B.2 All Standalone Products

B.3 All Host-Dependent Products

B.4 All Personal Computer Products

APPENDIX C HISTORICAL COMPANY DATA

Appendix C — Historical Company Data d Historical Data — By Company

APPENDIX E

Economic Data and Outlook

* Titles in capital letters signify tabs.

4: © 1986 Dataquest Incorporated Jan. 15 CCIS Markets

Table of Contents

CADlCAM INDUSTRY SERVICE

Newsletters 1985-Present

NEWSLETTERS*

DATAQUEST's Semiconductor Industry Conference: Snapshot of an Industry in Transition

ADEE East Show: Partners at Work

Computer-Aided Inspection: Measuring Up to Quality

Engineering Workstation Market Heats Up in Japan

Daisy Systems Wraps Digital's VAX Products Into Fold

Sharing the Expertise: The Semiconductor and Electronic CAD Markets Team Up for

Automated Design

New 68020 Workstations . . . Right On Track, But for How Long?

The 22nd DAC: The Industry Shakes, Rattles, and Rolls in Las Vegas

AE Systems 85 Low-Cost Drafting Pencils Versus Integrated Solutions

The Ultimate IC Design Tool Race Rages On

The Generation Gap—An Update on 32-bit Microprocessors

16-Bit Microprocessor Market in 1984

1985 CAD/CAM User Survey Results

CAE Systems' PC Strikes at Standalone Market rphe Wait is Over—Digital Unveils the MicroVAX II

Whitechapel Computer Works' MG-1—A Personal Workstation

. Personal Computer-Based CAD/CAM—Miracle or Mirage?

Communications/Networking in Design Automation: A Vital Link

Calma Announces Low-Cost GDSII

3-D Graphics Terminals—Perceptions Change as Costs Fall

Tektronix Prepares to Test EDA Vendors

A Silicon Valley Start-Up Takes on the CAD Market Goliaths

Titles in capital letters signify tabs.

CCIS Markets © 1986 Dataquest Incorporated Jan. 15

Table of Contents

CADlCAM INDUSTRY SERVICE

Newsletters 1981-1984

NEWSLETTERS*

Daisy Systems Acquires Vulcan Software Platform for Electromechanical Strategy

McDonnell Douglas's GIMTECH and IBM . . . Not Just Another VAR

Auto-trol Eyes Data Structure Technology; Buys Tricad

CAD/CAM Software: Forecasts and Analysis

Digital Announces Its Most Powerful Performer—The VAX 8600

Solids Modeling: Market Potential Still Untapped

Sun Microsystems Expands Product Line

Intergraph—Four New Significant Products

Autofact 1984

Adage: The New CAD/CAM Turnkey Vendor With the CADstation 2/50

IBM Announces New Graphics Products; Opens Door for Graphics Standards

Daisy Systems Corporation: The Growth of a Company

IBM Announces Awesome New Products

Saber Technology Combines Design Innovation and Systems Integration

The Ridge 32—Reaching New Levels of Computing Price/Performance

The Design Automation Conference is the Premier EDA Show

CV Acknowledges the VAX and Ushers in Medusa

Personal Computer-Based CAD/CAM Systems: Market Trends

Silvar-Lisco: A Software Company or a Turnkey Company?

The Second Big Gun Explodes

Calcomp's New 32-Bit Standalone System 25 for the AEC Market

SST Systems—New Levels of Price/Performance For Plant Analysis

Computer Graphics Tokyo '84

Parallax to Unveil High-Speed Graphics Controllers at NCGA

Prime Computer Acquires Joint Co-ownership of Medusa Software

Major Product Announcements From Mentor Graphics

The Boom in Semiconductor Start-ups

CAD/CAM 1983: Momentum

Electronic Design Automation Year-End Summary

CAD/CAM User Survey

Computervision Announces Strategic Product Plan

The Evolution of the Printed Circuit Board CAD Market Part 2

Apollo Delivers Non-68000 Based Systems

The Evolution of the Printed Circuit Board CAD Market Part 1

The Choice is Right: Calma Positions Itself With a Choice of Product Lines

IRIS—The Integrated Raster Imaging System

Real Time Displays and CAD/CAM: The Weitek Approach

Input Devices Report

Data General Announces the Eclipse MV/4000 For Industrial and Office Automation

Computervision Changes Vertical Integration Direction Announces IBM System

Graphics at Work: NCGA '83

Auto-trol Reborn: Company Shows Renewed Interest in AEC

CAE Electronic Design Automation System Slotted for Fall Delivery

Summary of the Design Automation Conference and the National Computer Graphics

Association Conference, 1983

Titles in capital letters signify tabs.

§, ©1986 Dataquest Incorporated Jan. 15 CCIS Markets

Table of Contents

CAD/CAM INDUSTRY SERVICE

Newsletters 1981-1984 (Continued)

NEWSLETTERS* (Continued)

Apollo Computer Introduces the DN300 Networked Engineering Workstation

Electronic Design Automation (EDA) and Application-Specific Integrated Circuits (ASIC)

CAD/CAM in Japan

Gould Moving Toward Factory Automation?

Graphics Price/Performance Update

Piping in AEC, Part 2

Plotters in CAD/CAM Market Forces Give Rise to New Market Segmentation

Hewlett-Packard Unveils HP 9000 Engineering Workstation

Piping in AEC: More Developments Needed to Meet Industry Needs

Emerging Market for Personal Computer-Based CAD Systems

Summary 1982: Adjustments to the Economy and a Plethora of Product Offerings

Update: Integrated Circuit Design Automation Market

SoUd Modeling: A Key to Success in Mechanical CAD/CAM

HP Announces Reorganization

Prime Computer Acquires English Software Company

Metheus Introduces New Generation VLSI Development System

Computervision Acquires European CAD/CAM Companies

Computer Companies in CAD/CAM: Prime Computer Cuts Workstation Prices

CAD AM: Software For IBM and IBM Plug-Compatible Machines

Turnkeys Address the IC Workstation Market

The IBM and IBM Plug-Compatible Graphics Display Market for CAD/CAM Applications

Array Processors and CAD/CAM: The Intergraph Approach

New Performance Levels for Graphics Systems in CAD/CAM

Full House Dealt from DEC

CAD Address the Gate Array Market

The 32-Bit Computer and Its Impact on the CAD/CAM Industry

Ultra High-Performance GPMC Market Update

IBM Announces Reorganization

Start-up CAD Companies Aim at the Engineer

General Electric Unfolds Plans for Factory of the Future

Titles in capital letters signify tabs.

CCIS Markets ©1986 Dataquest Incorporated Jan. 15

Table of Contents

(Page intentionally left blank)

1986 Dataquest Incorporated Jan. 15 CCIS Markets

1.0 Market Overview

Chapter 1 outlines and discusses the CAD/CAM market from a high-level perspective. It is intended to be used as a summary overview for the research presented in Chapters 2 through 7 and in the Forecast volume.

The body of this chapter follows Dataquest's CAD/CAM Industry Service data base format illustrated in Figure 1.0-1. Each of the six information tiers listed at the left of the figure is discussed in order, with figures, tables, and bulletized analysis.

Figure 1.0-1

Dataquest CAD/CAM Data Base Structure

Channel

Components

Direct Indirect

Turnlcey Nonturnkey

Computers

Graphic

Terminals

Peripherals

Software Service

Applications

Mechanical AEC Mapping EDA IC PCS

Regions

North

America

UK FR

Europe

Systems

Architecture

Personal

Computer

Standalone

Far East

JA KG TA SG HK OH

ROW

Host-Dependent

Price

Less Than

$20K

$20K-$50K $15K-$80K

Greater Than

$80K

CCIS Markets

1986 Dataquest Incorporated July

Source: Dataquest

June 1986

1.0-1

1.0 Market Overview

MARKET OVERVIEW

The CAD/CAM market remains one of the most dynamic application areas in the high-technology industry. It is a melting pot of computers, graphics, and application software that, when combined, form the nucleus of a system used to design and manufacture a wide array of products and components.

60

50-

40-

30-

20

Percent

:80-t

80-

70

10-

0-

1980

1985-SLOWING REVENUE GROWTH

From a historical perspective, 1985 was a difficult year for the major turnkey

CAD/CAM vendors. As Figure 1.0-2 illustrates, the major turnkey vendors enjoyed a 40 to 50 percent year-to-year growth rate until 1985, when growth fell beiow

20 percent. Dataquest believes that this 20 percent growth rate represents a permanent correction in the marketplace. We expect that over the next five years, the CAD/CAM industry as a whole will grow at an average of 21 percent.

Figure 1.0-2

Major Turnkey CAD/CAM Percent Growth

1981 1982

1963 1984

1985

Source: Dataquest

June 1986

1.0-2 1986 Dataquest Incorporated July

CCIS Markets

1.0 Market Overview

When compared to other high-technology industries, however, the CAD/CAM industry did not fare badly. Figure 1.0-3 reveals that the adjusted CAD/CAM industry growth (discounting the sale of personal computers and nonturnkey systems) was 33 percent from 1984 to 1985. The CAD/CAM industry outperformed graphics terminals, telecommunications equipment, computers, display terminals, semiconductors, and printers. Even the 17 percent growth of the major turnkey vendors looks good compared to these other industries.

Figure 1.0-3

Selected High-Technology Industries' Growth

1984-1985

Percent

40-

30-

^Xw kxx"<">

20

10-

K X ^

^f

V.XX -t,. '1.

Si

c

-10

-20

CAD/CAM Graphics Telecom Computers Display Semiconductors Printers

Terminals Equipment Terminals

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July

1.0-3

1.0 Market Overview

VENTURE CAPITAL SLOWDOWN

The slowing infusion of venture capital is a positive factor affecting not only the

CAD/CAM industry but other areas of high technology as well. As

Figure 1.0-4 indicates, Dataquest believes that venture capital commitments to independent private firms has been brought more in line with historical investing patterns. This has helped to stem the tide of "me too" companies and products that were spawned by overly ambitious venture capital outlays during 1983 and 1984.

The downside to this slowing capital infusion is that IBM's $4.72 billion spent on

R&D in 1985 is more than double the entire $2.35 billion in venture capital outlays in 1985. The implications here are fairly obvious.

Figure 1.0-4

How Much Venture Capital Is Available?

BUliorrs of Dollars

4

1.0-4

1978 1979 1980

1981 1982 1983 1984 1985

Source: Venture Capital Journal

1986 Dataquest Incorporated July

CCIS Markets

1.0 Market Overview

FALLING WORKSTATION PRICES

A major problem facing many CAD/CAM vendors is the dramatic decline in average workstation selling prices. Through 1983, workstations averaged around

$90,000 per seat as shown in Figure 1.0-5. With the influx of personal computers and Other low-cost engineering workstations, the average selling price fell to the current $56,000 per seat. Dataquest believes that hardware prices have stabilized and most vendors have begun to realign their organizations to accommodate the changing product mix toward lower-priced systems. Therefore, Dataquest is not looking for any new dramatic market corrections as a result of lower average selling prices.

Figure 1.0-5

CAD/CAM Workstation Average Selling Prices

Thousands of Dollars

60-

50

40-

30-

a u -

80-

70-

20-

10-

n-

1980

1981 1982 1983

1

'

1984

• •

1985

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

1.0-5

1.0 Market Overview

One positive effect that has resulted from lower average selling prices is that unit demand has been highly elastic. Workstation unit shipments grew 380 percent from 1983 to 1985 while prices dropped 40 percent during the same period.

Dataquest believes that a good deal of this increased demand came from first-time

PC-based CAD/CAM buyers who ordinarily would not have purchased a CAD system unless it was priced at low "consumer-like" levels, which reduced the purchasing risk. Dataquest predicts that in the future, the majority of workstation purchases will come from repeat buyers who plan to expand the use of CAD/CAM throughout their organizations. This trend is graphically represented in

Figure 1.0-6. The implications of this trend are as follows:

• Repeat purchasers have vastly different purchasing criteria and expectations than first-time purchasers.

• Repeat purchases usually have strong requirements for data and hardware compatibility with existing systems.

• Repeat purchases often encompass a much broader range of application-solution requirements, such as linkage with manufacturing or testing disciplines.

1.0-6 © 1986 Dataquest Incorporated July CCIS Markets

Number of

Workstations

Figure 1.0-6

CAD/CAM Workstations by Type of Purchaser

1.0 Market Overview

2nd Time

Buyers

1st Time

Buyers

Time

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July 1.0-7

1.0 Market Overview

THE LEADING VENDORS' MARKET SHARE EROSION

Dataquest has also witnessed another trend in the CAD/CAM industry over the past few years—the relative market share erosion of the top 10 CAD/CAM suppliers. Through 1983, the top 10 suppliers captured more than 80 percent of the market, as shown in Figure 1.0-7. In 1985, the top 10 suppliers' share slipped to

67 percent of the market. While this is still a rather significant share, Dataquest believes that this trend is likely to continue. In other words, we believe that a greater number of companies will share in the the wealth of the CAD/CAM industry. These emerging companies may not ever reach $200 million in revenue, but we are reasonably certain that a good number of $30 million to $100 million companies will continue to erode the overall share of the leading 10 vendors.

Figure 1.0-7

CAD/CAM Market Percent Shares of Top 10 Suppliers

30

20

10

0

60

50

40

Percent loose ao^

70w^

\.

1981 1982

^ ^

V

l\

1983

.

^

1984

N^

1985

Source: Dataquest

June 1986

1.0-8 1986 Dataquest Incorporated July CCIS Markets

1.0 Market Overview

A key factor contributing to the share erosion of the top 10 suppliers is the complexity and diversity of today's CAD/CAM industry. It no longer comprises a mere handful of companies chasing after the aerospace and automotive business.

According to Dataquest's Who's Who In CADICAM, more than 500 suppliers provide products for markets such as technical publishing, garment design, consumer goods, and medical equipment. Many small companies are addressing niche opportunities by coupling application expertise with CAD/CAM technology. The

Autodesk third-party software catalog alone lists more than 100 enterprising young companies that have designed application-specific products that "piggy-back" the

AutoCAD program. Most of these companies are down in the noise level, with less than $1 million in annual sales. But collectively, the noise these companies have made has risen to a dull roar and could become much louder in the future.

ACCESS-THE NEXT WORKSTATION PRODUCTIVITY DRIVER

Throughout the 1970s and early 1980s, most C/UD/CAM system purchases were justified on the basis of delivering sorely needed computer power to critical problems in the design process. Although this application of computer power has greatly improved the productivity of an individual or discipline, it is all too apparent that what has really happened is that that CAD/CAM system has simply moved the product automation bottleneck from one discipline to another. For example, the

CAD/C/^M system installed in the drafting department has allowed the delivery of a three-foot stack of drawings to manufacturing instead of a one-foot stack. The overall productivity of the operation has not improved, however, because manufacturing cannot deal with that many drawings all at once.

Dataquest believes that the next wave of workstation purchases will be justified by longer-range plans to plug all disciplines into the CAD/CAM network to improve productivity of the entire operation (see Figure 1.0-8). We are already seeing evidence of this trend at companies such as General Motors, Hughes, Boeing, and

Rockwell.

CCIS Marlcets © 1986 Dataquest Incorporated July 1.0-9

1.0 M a r k e t Overview

Figure 1.0-8

CAD/CAM Systems Evolution

Productivity

A

Access

Function

Time

Source: Dataquest

June 1986

1.0-10

1986 Dataquest Incorporated July CCIS Markets

1.0 Market Overview

THE CADlCAM SOFTWARE HIDING PLACE

One of the biggest problems facing the CAD/CAM industry was pointed out by

William Zarecor, Vice President of Marketing for Intergraph Corp. at the

Prudential-Bache 1985 Autofact conference. As indicated in Figure 1.0-9, the declining cost of hardware is uncovering the hidden price of software. In a turnkey system, the price of the software is buried in the price of hardware. Mr. Zarecor's concern, which we also share, is the market's reaction to having to pay more for the software than the hardware. Dataquest believes that the combination of falling hardware prices, standardized hardware platforms, and smarter users will inevitably lead to the emergence of the nonturnkey market. This in turn will lead to unbundling and site licensing. There is simply not enough room in the market for two markups on hardware. CAD/CAM technology and standards have matured to the point where CAD/CAM is no longer a black art; users can now perform the necessary software and hardware integration themselves.

Figure 1.0-9

CAD/CAM Software Hiding Place

Cost

Cost of Hardware

CCIS Markets

Software

"Hiding Place"

Time

Source: Intergraph Corporation

Dataquest

June 1986

1986 Dataquest Incorporated July

1.0-11

1.0 Market Overview

CHANGING TREATMENT OF AUTOMATION EXPENDITURES

A major change is taking place within large manufacturing companies regarding the way in which automation expenditures (such as CAD/CAM) are handled. In the past, engineering and manufacturing had separate budgets to vertically automate their organizations, as illustrated in Figure 1.0-10. Very little time and dollars were spent ensuring that the automation equipment could be bridged across disciplines. Now, however, in order to ensure consistency, companies are building separate organizations headed by chief automation officers, to organize their strategic expenditures across disciplines (see Figure 1.0-11). For example, General Motors bought Electronic Data Systems to serve in this capacity.

The implications of this change are as follows:

• C/UD/CAM vendors must provide gateways or solutions that encompass a much broader range of applications.

• CAD/CAM vendors will have to deal with having their systems scrutinized in new environments and, therefore, will have to learn to speak new languages and provide support for these disciplines.

• Having CAD/CAM systems treated as strategic, as opposed to tactical, expenditures tends to raise the purchasing decision to a higher level within an organization. In other words, the decision on which company to buy from becomes more of a business decision than a technical preference.

1.0-12 © 1986 Dataquest Incorporated July CCIS Markets

Figure 1.0-10

Traditional Automation Budget Allocation

1.0 Market Overview

Engineering

$

IVianufacturing

$

Tactical

Strategic

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July 1.0-13

1.0 Market Overview

Figure 1.0-11

Future Automation Budget Allocation

Engineering

$

Tactical

Manufacturing

Strategic

$

Tactical

Chief

Automation

Officer

$

Soiirce: Dataquest

June 1986

TECHNOLOGY OPPORTUNITIES

Dataquest sees a number of key technological opportunities emerging within the CAD/CAM market over the next several years, including:

• Silicon compilation

• Desktop systems

• Expert systems

• Application accelerators

• CAD/CAM data bases

1.0-14 1986 Dataquest Incorporated July

CCIS Markets

1.0 Market Overview

Silicon Compilation

James Solomon, president of Solomon Design Associates, calls silicon compilation the "Manhattan project of the eighties." Silicon compilation is changing the way integrated circuits are designed and is shrinking design cycles from weeks and months, to days and hours. Dataquest views silicon compilation as a replacement technology for handcrafted and place-and-route systems. In 1985, silicon compiler-based CAD systems accounted for $8.8 million in revenue.

Dataquest believes that silicon compilation will grow at a 157 percent compound annual grov^h rate through 1990 when revenue is expected to top $520 million.

Desktop Systems

The desktop workstation technology area is experiencing explosive growth. The new breed of low-cost, high-performance systems from companies such as Apollo

Computer, Digital Equipment, IBM, and Sun Microsystems is spawning a new era of price/performance. The critical need to plug many people into CAD/CAM networks at an affordable cost is accelerating the installation of low-cost, desktop systems. Dataquest believes that the new low-cost, high-performance, 32-bit virtual workstations will begin to place considerable pressure on personal computers beginning this year.

Expert Systems

Dataquest believes that expert systems will begin to play a more prominent role in the design of future CAD/CAM systems. However, we do not expect CAD/CAM expert system development to employ Lisp or Prolog languages running on inference engines. Rather, we believe that expert systems as applied to CAD/CAM means separating knowledge from the application and including more advanced reasoning features to help the user solve a particular problem. Dataquest believes that these systems will be designed using standard Fortran and C languages running on Standard computer architectures.

Application Accelerators

Application accelerators that employ custom and semicustom integrated circuits will become more common in C/\D/CAM systems. Today, application accelerators have been successfully applied to accelerate circuit simulation and graphics.

Dataquest also envisions the use of accelerators to speed up finite element analysis and data base retrieval in the very near future.

CCIS Markets © 1986 Dataquest Incorporated July 1.0-15

1.0 Market Overview

CAD/CAM Data Bases

There has been a good deal of recent discussion regarding which data base technology to use in order to manage a large CAD/CAM data base that has to be accessed by many disciplines. Most commercial data base applications were designed for payroll, order entry, and inventory management applications.

CAD/CAM data bases are much more complex, primarily because they have to deal with graphical information. For example, a B-spline surface is considerably more complex than an employee record in a personnel file.

Although nothing has emerged that completely solves the myriad of problems associated with implementing large-scale CAD/CAM data bases, the approach illustrated in Figure 1.0-12 looks very promising from our perspective. SST

Systems, an AEC process plant design software vendor, developed this "software switch" concept in order to better accommodate the numerous ways that piping information has to be handled. The system utilizes a relational data base as the core holding tank and employs software switches that build data bases on demand that are suited specifically for the needs of a given application. For example, the core data base might contain all of the design and fabrication information for a single process plant. To interact with the data base, software switches are devised to extract and build application data bases with data types geared specifically for

P&IDs, piping runs, or detail drawings. Efficiency is no longer compromised when designing an application by being tied to a data structure that was designed for another purpose. Dataquest believes that this approach would also adapt easily to electronic and mechanical applications.

1.0-16 © 1986 Dataquest Incorporated July CCIS Markets

1.0 Market Overview

Figure 1.0-12

CAD/CAM Software Switch Data Base Technology

Source: SST Systems, Inc.

Dataquest

June 1986

MARKET OPPORTUNITIES

Dataquest sees a number of key market opportunities emerging within the

CAD/CAM market over the next several years, including:

• Mechanical computer-aided engineering

• Facilities management

• Integration and support services

CCIS Markets 1986 Dataquest Incorporated July

1.0-17

1.0 M a r k e t Overview

Mechanical Computer-Aided Engineering (MCAE)

The MCAE market has received a great deal of attention recently due to the emergence of two start-ups, Aries Technology and Cognition. These two companies are attempting to build and deliver systems designed to address theconceptual design problem as opposed to the more common turnkey approach, which emphasizes drafting and documentation. Dataquest believes that the MCAE market is being driven by the following factors:

• The first 5 percent of engineering dollars spent on a particular design dictates 85 percent of the committed engineering cost. MCAE helps to ensure that the early stages of the design process yield the best possible downstream results.

• It is 100 times more expensive to make design changes in the manufacturing cycle as it is in the conceptual design stage. MCAE systems can drastically reduce expensive design changes.

• MCAE tools typically are used by a small group of highly educated individuals with advanced engineering degrees in a given engineering organization. Dataquest believes that the new breed of easier-to-use MCAE systems will open up a large, new market for the remaining engineering masses who need access to conceptual design and analysis tools.

In 1985, the MCAE market (including both hardware and software) totaled

$210 million in revenue. Dataquest expects the MCAE market to grow more than

30 percent compounded annually through 1990, when revenue will reach

$753 million.

Facilities Management

The facilities management market deals with using a CAD system to manage physical assets such as buildings and manufacturing plants after they are built.

Typical functions include space allocation, furniture layout, and asset utilization.

Dataquest recently conducted a survey in the facilities management market and found that less than 2 percent of the potential market has been penetrated. The major problem in the facilities management market today is establishing clear channels of distribution. Dataquest estimates that revenue from the sale of facilities management systems reached $65 million in 1985. Revenue is expected to grow to more than $275 million by 1990, a 33 percent compound average growth rate.

1.0-18 © 1 9 8 6 Dataquest Incorporated July CCIS Markets

1.0 Market Overview

Integration and Support Services

Dataquest believes that services aimed at integrating existing CAD/CAM and data processing equipment represent a very lucrative market opportunity. The real question here is not if but how to address this opportunity. IBM has begun providing commercial CIM integration services by using its Federal Systems Group in a SWAT-team fashion. McDonnell Douglas has also established a major CIM business unit to address the area of industrial integration.

MARKET PENETRATION

Table 1.0-1 itemizes U.S. market penetration by application. Dataquest believes that only 4.7 percent of the U.S. CAD/CAM market has been penetrated thus far. Although detailed overseas census information is not available, Dataquest believes that penetration on a global level is less than 5 percent.

Table 1.0-1

U.S. CAD/CAM Market Penetration

1985

Installed Workstations

Total Available Market

Penetration Percentage

Mechanical

50,900

892,000

5.7%

*

AEC

25,200

538,000

4.7%

M a p p i n g

4,400

151,000

2.9%

Electronic Total

26.400

674,000

106,900

2,255,000

3.9% 4.7%

Source: U.S. Dept. of Labor

Dataquest

June 1986

#

CCIS Markets © 1986 Dataquest Incorporated July 1.0-19

1.1 Industry Overview

ESTIMATED CAD/CAM WORLDWIDE REVENUE

Dataquest estimates that the 1985 CAD/CAM market exceeded $4.8 billion in worldwide revenue, as shown in Table 1.1-1 and Figure 1.1-1 Revenue. The market is expected to grow at a 21.8 percent CAGR, exceeding $12 billion in revenue by

1990.

Dataquest forecasts the market to grow 21 percent overall in 1986, reaching

$5.8 billion in revenue. The key factors influencing positive growth in 1986 are as follows:

• Lower U.S. prime interest rates

• A strengthening U.S. economy

• Uncertainty over IBM's RT PC removed

• Improving overseas economic climate

• Low levels of CAD/CAM workstation penetration

Negative factors affecting CAD/CAM revenue growth in 1986 are as follows:

• Falloff in industrial production

• Slowing automobile sales

• Slowing commercial building starts

• Capital cutbacks in the oil industry

• Uncertainty over tax legislation

Table 1.1-1

Total CAD/CAM Market

(Millions of Dollars/Actual Units)

1985 1986 1987 1988 1989 1990 CAGR

Total MarI(et

Revenue 4,849 5,863 7,116 8,624 10,397 12,511 20.9X

Systems 65,212 88.769 118,891 157,873 211,532 283,682 34.2X

Workstations 82,056 107,051 139,497 180,471 234,056 304,055 29.9X

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July 1.1-1

1.1 Industry Overview

Figure 1.1-1 Revenue

Total CAD/CAM M a r k e t

Millions of Dollars

12000

10000-1

8000

6000-1

4000 iV'-vV^."*

MM

2000

A . W V

1985

1986

1987

^ ; : ^

p^

1S6S

1969

^Xvw

1990

Source: Dataquest

June 1986

1.1-2

1986 Dataquest Incorporated July

CCIS Markets

1.1 Industry Overview

ESTIMATED CAD/CAM WORKSTATION SHIPMENTS

Figure 1.1-1 Shipments illustrates Dataquest's estimate for CAD/CAM workstation unit growth. In 1985, more than 82,000 C/UD/CAM workstations were shipped worldwide. Dataquest predicts that unit growth will be nearly 30 percent in

1986, and reach 107,051 units. Dataquest estimates that unit demand will grow at a

30 percent compound annual growth rate, swelling to 304,055 units in 1990.

Figure 1.1-1 Shipments

Total CAD/CAM Market

Workstation Shipments

320000 T

280000

240000

200000-

160000

120000

60000

40000

1985

1986^

1987 19S6 1989 1990

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

1.1-3

1.1 I n d u s t r y Oveirview

MARKET SHARE

Figure 1.1-2 lists the top 10 CAD/CAM market share leaders in 1985, while

Table 1.1-2 ranks all 1985 CAD/CAM revenue by company. The market share erosion that has beset the major CAD/CAM vendors has not been equally distributed. Companies such as Daisy, Intergraph, McDonnell Douglas, Mentor, and

Prime grew at or above the normal industry average of 30 percent.

Figure 1.1-2

Total CAD/CAM M a r k e t Shares

1985

1.1-4

Control Data

2.4%

Daisy ' T

2.8% Mentor Prime Applicon

2.8% 2.9% 3-2%

Source: Dataquest

June 1986

1986 Dataquest Incorporated July

CCIS Markets

CCIS Markets

Table 1.1-2

Total CAD/CAM Market Shares

COMPANY

=s=ni==s

IBM

Intergraph

Computervision

Calma

McAuto

Applicon

Prime

Mentor

Daisy

Control Data

Heulett-Packard

Auto-Trot

Valid

Racal-Redac

Holguin-CAD

Scientific Calculations

Matra Datavision

CalcoInp

Cimlinc

Ferranti

Autodesk

Zycad

Cadnetix

Graftek

Gerber Systems

MacNeal Schuendler

Futurenet

Tektronix

Silvar-Lisco

Synercom

Cat ay

SDRC

Telesis

Gerber Scientific

Other Computer Companies

Other Europe Companies

Other Far East Companies

Other Turnkey and Software

All Companies

1985

REVENUE

$

$

$

$

$

48

36

33

32

27

27

26

25

24

22

21

20

20

137

134

116

90

65

57

51

50

870

526

441

183

170

155

140

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

i

$

18

17

16

15

15

6

229

231

570

184

1.0%

.7%

.7%

.6%

.6%

.6%

.5%

.5%

.5%

.5%

.4%

.4%

.4%

.4%

.4%

.3%

.3%

.3%

.1%

4.7%

1985

SHARE

=====

17.9%

10.9%

9.1%

3.8%

3.5%

3.2%

2.9%

2.8%

2.8%

2.4%

1.9%

1.3%

1.2%

1.0%

1.0%

4.8%

11.8%

3.8%

100.0%

Source: Dataquest

June 1986

1.1 Industry Overview

1986 Dataquest Incorporated July

1.1-5

1.1 Industry Overview

IBM

IBM was the leading CAD/CAM vendor again in 1985, recording more than

$870 million in C/yD/CAM revenue. This includes the sale of turnkey CAD/CAM systems, not the sale of IBM hardware in nonturnkey channels. Dataquest estimates that IBM received an additional $200 million to $300 million from the sale of nonturnkey hardware such as personal computers used for CAD/C/VM sold through indirect channels, and 43xx and 308x mainframes sold to end users running internally developed CAD/CAM systems.

On January 21, 1986, IBM announced the IBM RT PC, which is the company's first technical workstation. Market reaction to the RT PC has been uncharacteristically weak in the CAD/CAM application areas due to limited software availability and sub-par floating-point and networking performance.

Dataquest expects IBM to upgrade the RT PC's performance during the third quarter of 1986, which should bring the machine more in line with competitive workstation offerings.

IBM also began unveiling its EDA strategy earlier this year with the announcement of a new line of products called the Computer Integrated Electrical

Design Series (CIEDS). These products are based primarily on software products from Silvar-Lisco.

Intergraph

Intergraph grew 30 percent in 1985, a product transition year for the company.

Intergraph made great strides in the mechanical CAD/CAM application segment in

1985, which grew 57 percent over 1984.

The company recently reorganized its sales force into three divisions that address vertical opportunities in manufacturing, AEC, and mapping exploration. A lackluster first quarter of 1986 was widely expected as a result of this reorganization; however, the company reported very encouraging results with a

35 percent increase in sales and a 29 percent increase in profit over the same period in 1985.

Computervision

In 1985, it became apparent that Computervision's product line was too broad for the average salesperson to understand, much less support. The company fully recognizes this and has been refocusing most of its resources behind the recently announced CADDStation products based on the company's popular CADD4X mechanical CAD/CAM software and the Sun Microsystem engineering workstation.

Initial market reaction to the new CADDStation products has been very strong.

Dataquest expects the hemorrhaging that Computervision has been experiencing in its installed base will subside as a result of the new CADDStation products.

1.1-6 © 1986 Dataquest Incorporated July CCIS Markets

1.1 Industry Overview

Calma

Calma also had a tough 1985, although it made some impressive gains in the

AEC industry. Calma is continuing to invest heavily in research and development bouyed by an $80 million dollar cash infusion from its parent. General Electric.

McDonnell Douglas

McDonnell Douglas is one of the fastest growing CAD/CAD companies in the industry, growing over 63 percent in 1985. Although its primary business remains in the mechanical CAD/CAM application segment, the company has made tremendous inroads in the AEC business with its recent acquisition of Applied

Research of Cambridge. The company has also taken some business away from

Intergraph by teaming up with Synercom in the Civil Engineering CAD areas.

Perhaps the company's greatest strength is its strong computer integrated manufacturing (CIM) image. Dataquest believes that having a strong CIM market perception will be a key factor in future CAD/CAM sales.

Applicon

In 1985, Applicon underwent a year of transition and reorganization. The company merged with a sister Schlumberger company called Manufacturing Data

Systems Incorporated (MDSI) and moved its corporate headquarters from

Burlington, Massachusetts, to Ann Arbor, Michigan.

The company recently introduced BRAVO HI, its core mechanical CAD/CAM software on tlie Sun and Digital Equipment workstations. It has also unveiled a new high-performance color graphics display that has a resolution of 1,600 by

1,400 pixels.

Prime Computer

Prime grew 33 percent in 1985, showing revenue of $140 million in

CAD/CAM. The company now has full control of the Medusa software and has assembled a very strong management and development team to guide the future of its CAD/CAM products. Dataquest believes that later this year. Prime will unveil a new RISC technology workstation that is based on the MIPS computer and Silicon

Graphics terminals.

Mentor Graphics

Mentor experienced difficult third and fourth quarters last year as the market was reacting to personal computers and waiting for IBM's new workstation. In spite of this, the company grew a very respectable 56 percent. Dataquest believes that

Mentor is off and running this year and should benefit from new products based on the Apollo DN3000 workstation series.

CCIS Markets © 1986 Dataquest Incorporated July 1.1-7

1.1 Industry Overview

Daisy Systems

Daisy Systems was one of the most profitable CAD/CAM companies in 1985.

Today, however, the company is caught in a product transition from delivering proprietary computer systems to industry standard machines from Digital

Equipment and IBM. Dataquest expects Daisy to begin shipping most of its applications on Digital Equipment and IBM hardware by the third quarter of this year.

Control Data

Control Data did a very quiet $116 million in CAD/CAM revenue in 1985. The company has a solid nucleus of CAD/CAM products aimed primarily at the mechanical market, and appears to have found a nice niche in delivering mainframe-based CAD/CAM products. The company also has a very large, loyal customer in Chrysler, which has standardized its CAD/CAM hardware on the CDC

Cyber mainframes.

1.1-8 © 1986 Dataquest Incorporated July CCIS Markets

1.2 Application Overview

Figure 1.2-1 and Tables 1.2-1 and 1.2-2 illustrate the expected shift by application for CAD/CAM revenue and units from 1985 through 1990. We anticipate that the mechanical market will continue to remain the largest application, accounting for 54 percent of CAD/CAM revenue through 1990. The electronic CAD/C/^M applications (EDA, IC, and PCB combined) will grow slightly faster than the market as a whole, capturing 25 percent of the market in 1990.

MECHANICAL MARKET

The mechanical CAD/CAM market, which is the oldest and largest application segment, accounted for more than 55 percent of total CAD/CAM revenue in 1985.

Dataquest believes that the mechanical segment will continue to be the dominant application through 1990, reaching more than $6.8 billion in revenue.

Below are the key factors that we believe will affect the mechanical CAD/CAM application segment:

• Solids modeling is fast becoming a mainstream requirement whose acceptance has been accelerated by the availability of low-cost, high-performance, technical workstations.

• The MCAE market is expected be a major market opportunity helping to drive the sale of large-scale CAD/CAM systems.

• The ability to perform CIM tasks or integrate into a CIM environment will be a key success factor for vendors selling mechanical C/yD/CAM systems.

AEC MARKET

The 1985 AEC market continued to be dominated by Intergraph on the high erid, and by personal computer-based CAD suppliers such as Autodesk on the low end. Total 1985 revenue was $746 million, up 34 percent over 1984 revenue of

$554 million. With respect to the AEC market, Dataquest offers the following observations:

• Personal computer-based systems will continue to dominate unit sales in the AEC application segment.

• Intergraph continues to dominate the AEC segment, capturing almost one-third of the market.

• The slowdown in U.S. commercial building activity is expected to have a major adverse effect on CAD sales in the architectural market segment.

• Capital spending cutbacks in the oil and oil-related industries are expected to adversely affect sales of CAD systems.

OCXS Markets © 1986 Dataquest Incorporated July 1.2-1

1.2 Applicatiori Overview

MAPPING MARKET

The mapping market is the smallest CAD/CAM application segment. Many of the CAD/CAM vendors that helped pioneer this area have ignored it in recent years, due largely to their inability to satisfy the need for more intelligent mapmaking tools. In 1985, two vendors, Intergraph and Synercom, dominated this market segment with a combined 69 percent market share. Dataquest forecasts that mapping will grow at a compound annual rate of 27 percent through 1990, reaching

$720 million in worldwide revenue.

Other important points with respect to the mapping market are as follows:

• Unlike other CAD/CAM applications, mapping systems are almost entirely host-based systems. Due to the large data base requirements of this application, we expect host-dependent systems to continue to dominate, although we believe that standalone devices will play a greater role as front-end graphics devices.

• Intergraph's dominance in mapping is due primarily to its large installed base in the utility and municipal industry segments.

EDA MARKET

In 1985, the EDA market was the fastest-growing CAD/CAM application segment, growing over 92 percent in revenue from $276 million in 1984 to

$531 million in 1985. Mentor, Daisy, and Valid continued to set the pace for this dynamic market, capturing 24, 20, and 9 percent market share, respectively.

Dataquest believes that in 1986, the EDA market growth will slow significantly to

19 percent growth overall. A good deal of this growth is expected to come from new EDA market participants such as IBM, Hewlett-Packard, and Tektronix.

Other observations that Dataquest believes are important with respect to the

EDA market segment are as follows:

• The ability to interface and integrate computer-aided testing activities with

EDA systems is becoming increasingly important in purchasing decisions.

• A key success barometer for vendors in the EDA market segment will be the ability to capture repeat purchase business. Dataquest believes that repeat purchases will outpace new purchases by at least a 2-to-l margin.

• Products that allow end-to-end EDA integration with many disparate types of software and hardware will be more marketable than systems with closed architectures.

L2-2 © 1986 Dataquest Incorporated July CCIS Markets

1.2 Application Overview

IC MARKET

The IC CAD market accounted for 1985 revenue of $198 million, which represented a 26 percent increase over 1984 revenue. Dataquest believes that the underlying technology in the IC CAD market is changing from handcrafted, full-custom tools toward cell-based place-and-route systems along with silicon compilers.

Dataquest identifies the specific trends in IC CAD as follows:

• By 1990, silicon compilers are expected to capture 47 percent of the

1(1! CAD market, while automated place-and-route systems are expected to capture 43 percent; this leaves 10 percent for handcrafted systems.

• Tighter coupling of IC CAD systems with EDA and test functions is expected to continue.

PCB MARKET

The PCB market grew 34 percent in 1985, reaching $477 million in revenue.

Dataquest expects the PCB market to grow at an average of 17 percent per year through 1990, reaching a market size of more than $1 billion in revenue. We foresee the following factors as playing key roles in this growth opportunity:

• The shorter product life cycles coupled with the global imperative to become more productive wiil continue to drive end-user demand for PCB

CAD products.

• Application accelerators will play a larger role in future PCB CAD systems.

CCIS Markets © 1986 Dataquest Incorporated July 1.2-3

1.2 Application Overview

Figure 1.2-1

Total CAD/CAM Market Revenue by Application

1985

1

Mechanical

Iwq AEG

iiiiil

Mapping

H

EDA

ym

10

liiil

PCB

1980

Source: Dataquest

June 1986

1.2-4

1986 Dataquest Incorporated July

CCIS Markets

1.2 Application Overview

Table 1.2-1

Total CAD/CAM Market by Application

(Millions of Dollars/Actual Units)

1985 1986 1987 1988 1989 1990

CAGR

Total Marlcet

Revenue

Systems

Uorkstations

Mechanical

Revenue

Systems

Uorkstations

AEC

Revenue

Systems

Uorkstations

Mapping

Revenue

Systems

Workstations

EOA

Revenue

Systems

Uorkstations

IC

Revenue

Systems

Uorkstations

PCB

Revenue

Systems

Uorkstations

4,849

65,212

5,863

88,769

82,056 107,051

7.116 8.624 10.397

12,511

118.891

157.873

139,497 180.471

211.532

234.056

283,682

304,055

2,677

29,632

40,635

3,266

42,232

53.568

3,952

59,457

71,909

4.742

83.537

5.664

118.473

96,607 130.282

6,760

167,133

176,265

746

15,466

18,514

220

432

1,752

531

14,036

14,068

198

1,196

1,419

477

4,449

5,668

896

16,977

20,712

1,075

20.774

25.201

288

2,153

3,866

230

1,753

1.950

552

6,949

8,221

375

3.276

5.714

632

18,705

18,733

764

22,785

22,817

292

2,723

2,881

659

9.876

10,975

1,296

25,352

30,486

1.559

30,933

36,465

1,876

37,096

42,525

476

3,661

7,001

590

4.083

8.425

940

27.767

27,803

1.138

34.287

34,320

392

4,164

4,280

778

13,392

14,294

543

6,121

6,197

720

4,527

9,762

1,354

42,873

42,895

762

8,903

8,945

902

17,634

18,367

1,038

23,150

23,663

20.9%

34.2X

29.9%

20.4%

41.3%

34.1%

20.2%

19.1%

18.1%

26.7%

60.0%

41.0%

20.6%

25.0%

25.0%

30.9%

49.4%

44.5%

16.8%

39.1%

33.1%

Source:

Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

1.2-5

1.2 Application Overview

Table 1.2-2

Total CAD/CAM Market by Application

(Percent of Total)

1985

1986 1987 1988 1989 1990

Mechanical

Revenue

Systems

Workstations

AEC

Revenue

Systems

Workstations

Mapping

Revenue

Systems

Workstations

EDA

Revenue

Systems

Workstations

IC

Revenue

Systems

Workstations

PCB

Revenue

Systems

Workstations

5%

2%

4%

11%

21%

17%

56%

48%

50%

15%

19%

19%

4%

2%

2%

9%

8%

8%

5%

1%

2%

11%

22%

17%

55%

45%

50%

15%

24%

23%

4%

2%

2%

10%

7%

7%

5%

3%

4%

11%

19%

16%

56%

50%

52%

15%

17%

18%

4%

2%

2%

9%

8%

8%

55%

53%

54%

5%

3%

2%

9%

8%

8%

15%

16%

17%

6%

2%

4%

11%

18%

15%

6%

2%

4%

11%

16%

15%

54%

56%

56%

15%

15%

16%

5%

3%

3%

9%

8%

8%

54%

59%

58%

15%

13%

14%

6%

2%

3%

11%

15%

14%

6%

3%

3%

8%

8%

8%

Source: Dataquest

June 1986

1.2-6

1986 Dataquest Incorporated July

CCIS Markets

1.3 Geographical Overview

Figure 1.3-1 and Tables 1.3-1 and 1.3-2 illustrate the regionalized revenue

forecast for the CAD/CAM market. We predict very little change in the relative percentages of the CAD/CAM market with respect to geographic distribution. We expect North America to continue to capture the lion's share of the market with more than 55 percent share through 1990. In addition, we offer the following points regarding the geographic distribution of the CAD/CAM marketplace:

• We believe that North America will grow slightly faster than the world as a whole, given our bullish long-term outlook for the U.S. economy.

• The U.S. CAD/CAM industry is one of the few areas of high technology that is not threatened by foreign competition. In fact, the reverse is true.

Greater than 80 percent of revenue in the 1985 Japanese CAD/CAM market was derived from U.S.-based CAD/CAM products.

The overseas markets are beginning to see a greater level of competition

EUROPEAN MARKET

This section discusses the European CAD/CAM Market. The market numbers in this section differ from those presented in the forecast model because we have included the OEM and value-added revenue of European distributors selling

U.S.-based systems.

European Market Revenue

The European C/UD/CAM market grew 55 percent in 1985, reaching

$1,164 billion in revenue as illustrated in Figure 1.3-2 Revenue and Table 1.3-3.

Dataquest believes that the European market was outdistanced only by the

Far Eastern CAD/CAM market, which grew 62 percent in 1985. Dataquest expects the European market to grow 21 percent in 1986, reaching over $1.4 billion in revenue. We are forecasting a 21 percent compound annual growth rate through

1990, which translates to nearly $3 billion in C/UD/C/'^ revenue in 1990.

European Workstation Shipments

Figure 1.3-2 Shipments illustrates expected unit growth for CAD/CAM workstations sold in European markets. Dataquest forecasts that unit shipments will exceed 27,000 units in 1986, growing to 76,405 units by 1990.

CCIS Markets © 1986 Dataquest Incorporated July 1.3-1

1.3 Geographical Overview

European Market Share

Figure 1.3-3 and Table 1.3-4 list the European market share leaders. IBM continues to dominate the European CAD/CAM market followed by

Computervision, Intergraph, Applicon, and Calma.

European Applications

Figure 1.3-4 and Tables 1.3-5 and 1.3-6 identify the European market by application. The European market is more heavily oriented toward mechanical

CAD/CAM applications than the world market as a whole.

European Regions

Figure 1.3-5 and Table 1.3-7 illustrate 1985 European regional country splits for the sale of CAD/CAM equipment. Nearly three quarters of all European revenue is generated by West German, U.K., and French CAD/CAM manufacturers. Italy is the fastest-growing country in Europe for CAD/CAM products. Its CAD/CAM revenue grew 142 percent in 1985.

European Product Type

Figures 1.3-6 and 1.3-7 along with Tables 1.3-8 and 1.3-9 represent our forecast by product type for the European CAD/CAM market. Like other world markets, the transition from host-based to distributed workstations is well under way.

FAR EASTERN MARKET

This section discusses the Far Eastern CAD/CAM Market. The market numbers in this section differ from those presented in the forecast model because we have included the OEM and value-added revenue of Far Eastern distributors selling

U.S.-based systems.

Far Eastern Market Revenue

The Far Eastern CAD/CAM market grew 62 percent in 1985, reaching

$953 million in revenue as illustrated in Figure 1.3-8 Revenue and Table 1.3-10.

We are forecasting much slower growth in the Far Eastern market (21 percent) in

1986, due primarily to the strength of the Japanese yen as compared with other world currencies. Dataquest estimates that the Far Eastern market will grow at a compound annual growth rate of 21 percent, reaching $2.4 billion in revenue by

1990.

S-3-2 © 1986 Dataquest Incorporated July CCIS Markets

1.3 Geographical Overview

Far Eastern Workstation Shipments

Figure 1.3-8 Shipments illustrates expected unit growth for CAD/CAM workstations sold in Far Eastern markets. Dataquest forecasts that unit shipments will exceed 21,000 units in 1986, growing to 58,599 units by 1990.

Far Eastern Market Share

Figure 1.3-9 and Table 1.3-11 list the Far Eastern market share leaders. IBM continues to dominate the Far Eastern CAD/CAM market followed by Fujitsu,

Hitachi, Mitsubishi Electric, and NEC. Unlike other CAD/CAM market regions, the

Far Eastern market is driven by computer companies. Seven of the top ten

Far Eastern CAD/C/yVI vendors are also computer manufacturers.

Far Eastern Applications

Figure 1.3-10 and Tables 1.3-12 and 1.3-13 identify the Far Eastern market by application. Like other world markets, the Far Eastern CAD/CAM market is dominated by mechanical applications. Dataquest does not expect any major shift in the Far Eastern application mix, although EDA applications are expected to grow slightly faster than the market as a whole.

Far Eastern Regions

With respect to market size, we believe that Japan represents more than

80 percent of the revenue derived from the sale of CAD/CAM systems in the

Far East. The other Far Eastern regions (Korea, Taiwan, Singapore, Hong Kong, and the Peoples' Republic of China) are just beginning to employ automated design and manufacturing methods and are somewhat limited in terms of market potential due to their early stage of industrial evolution. We expect that the non-Japanese areas' contributions to the Far Eastern revenue base will increase proportionally as their level of industrialization increases through this century.

Far Eastern Product Type

Figures 1.3-11 and 1.3-12 along with Tables 1.3-14 and 1.3-15 represent our forecast by product type for the Far Eastern CAD/CAM market. Like other world markets, the Far Eastern market is experiencing rapid growth in distributed workstations, especially personal computers.

CCIS Markets © 1986 Dataquest Incorporated July 1.3-3

1.3 Geographical Overview

Figure 1.3-1

Total CAD/CAM Market Revenue by Region

1985

1%

North America

IS>XI Europe

Far east

ROW

2%

1990

Source: Dataquest

June 1986

1.3-4

1986 Dataquest Incorporated July

CCIS Markets

Table 1.3-1

Total CAD/CAM Market by Region

(Millions of Dollars/Actual Units)

1.3 Geographical Overview

1985 1986 1987 1988 1989 1990

CAGR

Total Narlcet

Revenue

Systems

Workstations

4.849

65,212

82,056

5.863

88.769

107.051

7.116

118,891

8,624

10,397

12,511

157,873 211,532 283,682

139,497 180,471 234,056

304,055

20.9X

34.2%

29.9%

North America

Revenue

Systems

Workstations

2.648

36.788

43,905

3,201

47,510

57,239

3.887

63,500

74,840

4,720 5,701 6,872

83,269 112,282 151,129

96,203 125,538

163,688

21.OX

32.7X

30.IX

Europe

Revenue

Systems

Workstations

1,164

19.547

23.663

1,410

22,749

27,103

1,711

31,093

35,928

2,070

41,481

46,644

2,490

54.552

59.585

2.991

72,123

76,405

20.8X

29.8X

26.4X

Far East

Revenue

Systems

Workstations

953

8.262

13.521

1,150

17,370

21,158

1,394

22,488

26,430

1,683

30,475

34,421

2,022

41,085

44,724

2,426

55,689

58,599

20.5X

46. SX

34. IX

Rest of World

Revenue

Systems

Workstations

84

615

967

102

1.141

1.551

125

1,810

2,298

152

2,647

3,203

184

3,612

4,209

222

4,741

5,363

21.4X

50.5X

40.9X

Source:

Oataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

1.3-5

1.3 Geographical Overview

Table 1.3-2

Total CAD/CAM Market by Region

(Percent of Total)

North America

Revenue

Systems

Uorlestatlons

Europe

Revenue

Systems

Workstations

Far East

Revenue

Systems

Workstations

Rest of World

Revenue

Systems

Workstations

1985

ssa«

1986

ssss

1987

S 3 S S

1988

s m f f S

1989

sssa

55X

56X

54X

55X

54X

53X

55X

53X

54X

55X

53X

53X

55X

53X

S4X

1990

assa

55X

53X

54X

24X

30X

29X

20X

13X

16%

2X

1X

IX

24X

26X

25X

20X

20X

20X

2X

IX

IX

24X

26X

26X

20X

19X

19X

2X

2X

2X

24X

26X

26X

20X

19X

19X

2X

2X

2X

24X

26X

25X

19X

19X

19X

2X

2X

2X

24X

25X

25X

19X

20X

19X

2X

2X

2X

Source: Dataquest

June 1986

1.3-6

1986 Dataquest Incorporated July

CCIS Markets

1.3 Geographical Overview

Millions of Dollars aeoo

2400

2000-

1600-

1200

600

m

'KiFSS

IW

^

400

E^^

1986 19S5

Figure 1.3-2 Revenue

European CAD/CAM Market

E ? ^ ^ x<;%X"".^

'*, % -4.

•V ^ .

^ ^

m^

1987 xxX^C*^ vXX'^'N

v X v

S#

^ ^

1989

V\X**X

^.V'feVV

1990

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

1.3-7

1.3 G e o g r a p h i c a l Overview

Table 1.3-3

European CAD/CAM Market

(Millions of Dollars/Actual Units)

Revenue

Systems

Workstations

1985 1986 1987 1988 1989 1990 CAGR

1,164

19,547

23,663

1,410

22,749

27,103

1,711

31,093

35,928

2,070

41,481

46,644

2,490

54,552

59,585

2,991 21%

72,123 30%

76,405 26%

Source: Dataquest

June

1986

1-3-8 © 1986 Dataquest Incorporated July CCIS Markets

1.3 Geographical Overview

Workstation Shipments

80000

40000-

32000

24000

16000

8000

72000

64000

56000 -

48000

19S5 1986

Figure 1.3-2 Shipments

European CAD/CAM Market

1987

1988

1989

1990

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

1.3-9

1.3 Geographical Overview

Figure 1.3-3

E u r o p e a n CAD/CAM M a r k e t Shares

1985

Prime

2.4%

Matra Datavislon

2.4%

Daisy

2.4%

Mentor

2.6%

Racal-Redac

2.8%

Source: Datttqaesi

June 1986

1.3-10

© 1986 Dataquest Incorporated July

CCIS Markets

> o

• P N

XI

O

a u

u o v

O

(U

> u

0)

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1.3 Geographical Overview

Figure 1.3-4

European CAD/CAM Market Revenue by Application

1985

I I Mechanical

I ' - I AEG i I Mapping

y~ri\

10

1930

Source: Dataquest

June 1986

1.3-12 1986 Dataquest Incorporated July

CCIS Markets

#

1.3 Geographical Overview

Table 1.3-5

European CAD/CAM Market by Application

(Millions of Dollars/Actual Units)

At I Applications

Revenue

Systems

Workstations

Mechanical

Revenue

Systems

Workstations

AEG

Revenue

Systems

Workstations

Mapping

Revenue

Systems

Workstations

EDA

Revenue

Systems

Workstations

IC

Revenue

Systems

Workstations

PCS

Revenue

Systems

Workstations

1985

=====

1986

=====

1987

=====

1988

=ss=s

1989

=====

1990

=====

1,164

19,547

23,663

1,410

22,749

27,103

1,711

31.093

35,928

2,070

41,481

46,644

2,490

54,552

59,585

2,991

72,123

76,405

CAGR

=====

21%

30%

26%

713

11,107

14,300

871

12,510

15.456

1,054

18,536

21,605

144

4,475

5,063

173

4,067

4,776

208

4,834

5,734

47

182

372

37

213

237

62

767

1,097

43

345

381

116

1,146

1,271

135

1,819

2,149

81

864

1,351

106

2,424

2,422

126

3,241

3,245

153

3,906

3,912

54

534

562

1,265

25,978

29,039

250

5,670

6,744

103

970

1,632

1,512

35,172

37,956

1,805

47.831

50,045

301

6,679

7,791

363

7,769

8,702

127

1,170

1,986

156

1,341

2,251

188

4,900

4,907

228

6,212

6,218

73

797

821

102

1.155

1,173

161

2,420

2,765

190

3,167

3,502

220

4,165

4,461

271

7,985

7,987

143

1,665

1,677

254

5,532

5,743

20%

34%

28%

20%

12%

11%

27%

49%

43%

21%

27%

27%

31%

51%

48%

17%

37%

35%

Source: Dataquest

June 1986

OCXS Markets

1986 Dataquest Incorporated July 1.3-13

1.3 Geographical Overview

Mechanical

Revenue

S/stems

Worlcstations

AEG

Revenue

Systems

Uorlcstations

Mapping

Revenue

Systems

Workstations

EDA

Revenue

SysteIns

Workstations

IC

Revenue

Systems

Workstations

PCB

Revenue

Systems

Workstations

T a b l e 1.3-6

E u r o p e a n CAD/CAM M a r k e t by Application

(Percent of Total)

1985

:===

1986

S = 3 = =

1987

=====

1988

=====

1989 1990 s=r==:

61%

57%

60%

62%

55%

57%

62%

60%

60%

61%

63%

62%

61%

64%

64%

60%

66%

65%

12%

23%

21%

12%

18%

18%

12%

16%

16%

12%

14%

14%

12%

12%

13%

12%

11%

11%

4%

1%

0%

4%

3%

1%

5%

3%

3%

5%

2%

3%

5%

2%

3%

5%

2%

3%

9%

12%

10%

9%

14%

12%

9%

13%

11%

9%

12%

11%

9%

11%

10%

9%

11%

10%

3%

1%

1%

3%

2%

1%

3%

2%

2%

4%

2%

2%

4%

2%

2%

5%

2%

2%

10%

6%

5%

10%

8%

8%

9%

8%

8%

9%

8%

8%

9%

8%

7%

8%

8%

8%

Source: Dataquest

June 1986

1.3-14

1986 Dataquest Incorporated July

CCIS Markets

1.3 Geographical Overview

Figure 1.3-5

European CAD/CAM Market Revenue by Region

1985

Source: Dataquest

Junel986

CCIS Markets 1986 Dataquest Incorporated July

1.3-15

1.3 Geographical Overview

All Europe

Revenue

Systems

Workstations

United Kingdom

Revenue

Systems

Workstations

France

Revenue

Systems

Workstations

Germany

Revenue

Systems

Workstations

Italy

Revenue

Systems

Workstations

Bennelux Countries

Revenue

Systems

Workstations

Scandanavia

Revenue

Systems

Workstations

Rest of Europe

ReveiuIe

Systems

Workstations

Table 1.3-7

European CAD/CAM Market by Region

(Millions of Dollars/Actual Units)

All Mechanical sss

==========

AEC

===

1,164

19,701

23,663

713

11,206

14.300

144

4,480

5.063

Happing

=======

47

203

372

EDA

===

106

2,436

2,422

IC

==

37

225

237

PCS

===

116

1,152

1,271

252

5,534

13,102

143

3,067

1,802

35

1,718

4.351

8

36

2,806

26

553

3,461

10

60

2,484

31

302

1,569

229

4,016

6,026

144

2.298

3,709

27

805

1.161

378

5,654

7,137

235

3.129

4.333

45

1,177

1,391

88

1,303

2,079

56

864

1,434

78

1,302

1,911

48

760

1,190

11

210

342

9

267

360

5

40

87

23

558

615

16

63

100

34

817

782

7

19

23

3

16

30

7

142

122

6

140

168

111

1,529

2,400

70

906

1,518

2S

363

472

17

181

314

14

251

393

2

50

41

8

42

47

10

62

74

3

19

19

3

16

15

22

235

324

38

362

397

4

27

41

8

83

105

7

25

51

1

3

4

7

152

189

3

17

16

10 •

114

136

3

73

53

1

9

9

3

29

19

Source:

Dataquest

June 1986

1.3-16 1986 Dataquest Incorporated July

CCIS Markets

1.3 Geographical Overview

Figure 1.3-6

European CAD/CAM Market Revenue by Product Type

MIIIions of Dollars

2400-

Standalone

Host-Depandent

Personal Computer

2100-

1300-

1500-

1200-

9D0-

4

Y

6 0 0 -

3 0 0 -

0 -

1985

. -

^ .

1 1

1

19S6 1987 1988 i

1989 1990

Source: D a t a q u e i t

June 1 9 8 6

CCIS Markets 1986 Dataquest Incorporated July

1.3-17

1.3 Geographical Overview

Figure 1.3-7

European CAD/CAM Market Shipments by Product Type

30000

24000

18000

12000

6000

Workstation Shipments

54000

48000=

• Standalone

• Host-Dependent

A Personal Computer

42000

36000

04

1985 1986 1987 1988 1989 1990

Source: Dataquest

June 1986

1.3-18

1986 Dataquest Incorporated July

CCIS Markets

1.3 Geographical Overview

Table 1.3-8

European CAD/CAM Market by Product Type

(Millions of Dollars/Actual Units)

Host-Dependent

Revenue

Systems

Workstations

1985 1986 1987

All Product Types

Revenue

Systems

Workstations

1,164

19,547

23,663

1,410

22,749

27,103

1,711

31.093

35.928

2,070

41,481

46,644

2,490

54,552

59,585

2,991

72,123

76,405

Standalone

Revenue

Systems

Worlcstations

242

2.645

2,645

416

5,605

5,605

673

10,437

10,437

1,059

18,941

18,941

1,577

32,197

32,197

2,224

51,116

51,116

788

1,256

5,372

790

1.428

5.783

750

1,446

6,281

1988 1989

689

1.397

6.560

594

1,214

6,247

1990

467

896

5,179

Personal Computer

Revenue

Systems

Workstations

134

15,646

15,646

204

15.716

15.716

288

19.210

19,210

321

21,143

21,143

320

21,141

21,141

300

20,110

20,110

CAGR

21%

30%

26%

56%

81%

81%

-10%

-7%

-1%

17%

5%

5%

Source:

Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

1.3-19

1.3 Geographical Overview

Table 1.3-9

European CAD/CAM Market by Product Type

(Percent of Total)

Standalone

Revenue

Systems

Workstations

Host-Dependent

Reveiuie

SysteIns

Workstations

Personal

CoIrIputer

Revenue

Systems

Workstations

1985 1986 1987 1988 1989 1990

=s===

===== ===== =====

ES3==

21%

14%

11%

30%

25%

21%

39%

34%

29%

51%

46%

41%

63%

59%

54%

74%

71%

67%

68%

6%

23%

12%

80%

66%

56%

6%

21%

14%

69%

58%

44%

5%

17%

33%

3%

14%

17%

62%

53%

16%

51%

45%

24%

2%

10%

13%

39%

35%

16%

1%

7%

10%

28%

26%

Source: Dataquest

June 1986

1.3-20 © 1986 Dataquest Incorporated July CCIS Markets

1.3 Geographical Overview

Figure 1.3-8 R e v e n u e

Far Eastern CAD/CAM M a r k e t

Millions of Dollars

2400

2100

1800 4

1500-1

1200

900-1

600

'Xvw"

sss kVvXK

K

K:

300-]

0-1

1866 1986

1987

Wi

V C \

1968

V^'X^H

KS

WX'N

w

'XXsV

fc^^S

,,\.%.%.X

\X'v^-"

^^'"CSN vX'vXXI

1989

%'v^-iXH'

Source: Dataquest

k%

June 1986

I. ^ . ^ V t - . - ' ^ ''

CCIS Markets

1986 Dataquest Incorporated July

1.3-21

1.3 Geographical Overview

Table 1.3-1®

Far £ ^ t e m CAD/CAM Market

(Millions of Dollars/Actual Oniite)

Revenue

System

Workstations

i^5 1^6 tm7 1 ^ 1989 1990 CM»

m

8,262

13,521

1,156

17,3?8

21,158

1,394

22,4®

^ , 4 3 0

1,663

mA75

34,421

2 , 0 ^

4i,<n5

44,734

2 , 4 % 21X

5S,&59 UX

58,599 34% iSourve: OATACASST

June 1%6

1-3-22 © 1986 pataquest Incorporated July CCIS Markets

1.3 Geographical Overview

Figure 1.3-8 Shipments

Far Eastern CAD/CAM Market

Workstation Shipments

60000-

54000

48000

42000-

36000

30000

24000

18000-

12000

6000

1985

1986

^^5S

^m

vv

s^-s

1987

196S w^

1969

1990

Source: Dataquest

June 19S6

CCIS Markets

1986 Dataquest Incorporated July

1.3-23

1.3 Geographical Overview

Figure 1.3-9

Far Eastern CAD/CAM Market Shares

1985

Nippon Univac KalshIa

2.9%

Computervislon

4.6%

Source: Dataqaest

June i9S6

1.3-24

© 1986 Dataquest Incorporated July

CCIS Markets

CCIS Markets

1.3 Geographical Overview

Table 1.3-11

Far Eastern CAD/CAM Market Shares—1985

IBM

Fujitsu

Hitachi

Mitsubishi Electric

NEC

Computervision

Toshiba

Nippon Univac

ICaisha

Seiko I&E

Zuken

Mentor

Hitachi Zosen

Scientific Calculations

Mutoh Industries

Sharp System Products

Fuji Xerox

Ashi Optical

Daisy

McAuto

Afiplicon

Toyoelectric Manufacturing

Valid

Hitachiseiko

Design Autoroation

Hewlett-Packard

Univac Information Systems

Calma

Uchida Yoko

Prime

Wacom

Technodia

Control Data

Mitsui Engineering

Yokogaua Hokushin Electric

Century Research Center

Aida Engineering

Graphtec

Otsukashokai

Silvar-Lisco

Toyo Information Systems

Quwat (Shukosha)

Racal-Redac

Gerber Systems

Sumitomo Electric Industries

Hakuto

Other

Total

Revenue

Share

=====

19.1%

8.8X

7.5%

6.0%

5.8%

.4%

.4%

.2%

.2%

.2%

4.9%

.6%

.5%

.4%

.4%

.4%

.4%

.4%

1.1%

.9%

.9%

.8%

.8%

.8%

.7%

.7%

.7%

.7%

.7%

.7%

=======

182

84

7

7

6

6

8

7

7

7

15

14

13

11

11

11

10

9

8

23

21

19

18

16

16

71

57

55

43

33

27

27

4

4

3

3

2

2

6

6

5

4

4

4

2

47

953

4.5%

4.0%

2.9%

2.9%

2.4%

2.2%

2.0%

1.9%

1.7%

1.7%

1.5%

1.5%

1.4%

1.1%

1.1%

1.1%

100.0%

Source: Dataquest

1986 Dataquest Incorporated July

1.3-25

1.3 GeoRraphical Overview

Figure 1.3-10

Far Eastern CAD/CAM Market Revenue by Application

IVlechanical

G 3 AEC

I I Mapping

</?] 10

LU PCB

1990

Source: Dataquest

June 1986

1.3-26

1986 Dataquest Incorporated July

CCIS Markets

1.3 Geographical Overview

Table 1.3-12

Far Eastern CAD/CAM Market by Application

(Millions of Dollars/Actual Units)

All Applications

Revenue

Systems

Workstations

Mechanical

.

Revenue

Systems

Workstations

AEG

Revenue

Systems

Workstations

Mapping

Revenue

Systems

Workstations

EDA

Revenue

Systems

Workstations

IC

Revenue

Systems

Workstations

PCS

Revenue

Systems

Workstations

1985

=====

1986

=====

1987

=====

1988

=====

1989

=====

1990

=====

953

8,262

13,521

1,150

17,370

21,158

1,394

22,488

26,430

1,683

30,475

34,421

2,022

41,085

44,724

2,426

55,689

58,599

CAGR

=====

21%

46%

34%

589

4,771

8,411

719

10,366

12,910

870

12,879

15,774

1,044

17,962

20,980

1,248

25,447

28,205

1,490

36,001

38,172

109

1,403

1,995

131

2,579

3,242

157

3.248

3,845

189

3,811

4,425

18

37

162

24

79

234

31

206

373

66

916

953

79

2,319

2,320

35

158

267

136

977

1,733

41

251

298

158

1,777

2,154

95

2,897

2,899

51

478

502

189

2,780

3,037

69

738

750

223

3,942

4,113

228

4,323

4,958

40

445

573

49

593

681

96

1,085

1,091

259

5,186

5,339

275

5,003

5,598

60

701

750

117

3,577

3,579

142

4,449

4,451

169

5,612

5,613

135

1,579

1,583

298

6,793

6,884

20%

50%

35%

20%

29%

23%

27%

80%

36%

21%

44%

43%

31%

59%

43%

17%

47%

32%

Source:

Dataquest

June 1986

CCIS Markets

© 1986 Dataquest Incorporated July 1.3-27

1.3 G e o a r a p h i c a l Overview

Hechanical

Revenue

Systems

Workstations

AEC

Revenue

Systems

Workstations

Napping

Revenue

Systems

Workstations

EDA

Revenue

Systems

Workstations

IC

Revenue

Systems

Workstations

PCS

Revenue

Systems

Workstations

Table 1.3-13

F a r Eastern CAD/CAM Market by Application

(Percent of Total)

1985 ossss

1986

SEBSS9

1987

SS3SSE

1988

sssss

1989

= S « S E

1990

ffsasa

62%

58%

62%

11%

17%

15%

2%

0%

0%

7%

11%

7%

4%

2%

2%

U%

12%

13%

62%

60%

61%

11%

15%

15%

2%

0%

1%

7%

13%

11%

4%

1%

1%

14%

10%

10%

62%

57%

60%

11%

14%

15%

2%

1%

1%

7%

13%

11%

4%

2%

2%

14%

12%

11%

62%

59%

61%

11%

13%

13%

2%

1%

1%

7%

12%

10%

4%

2%

2%

13%

13%

12%

62%

62%

63%

11%

11%

11%

2%

1%

1%

7%

11%

10%

5%

3%

2%

13%

13%

12%

61%

65%

65%

11%

9%

10%

2%

1%

1%

7%

10%

10%

6%

3%

3%

12%

12%

12%

Source: Dataquest

June 1986

1.3-28 1986 Dataquest Incorporated July CCIS Markets

m

1.3 Geographical Overview

Figure 1.3-11

F a r Eastern CAD/CAM Market Revenue by Product Type

Millions of Dollars

< 1 U U U -

1800-

Standalone

Host-Dependent

Personal Computer

1600-

1400-

1200-

1 0 0 0 '

8 0 0 -

600-

1

4 0 0 -

200-

I t - * = ' ^ —

0 -

1985

A .

^ •

A •

1

19S6 1987

A

- I

1988

/

^ J r •

1990

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

1.3-29

1.3 Geographical Overview

Figure 1.3-12

Far Eastern CAD/CAM Market Shipments by Product Type

Workstation Shifsnents ajooo-

Standalone

4SO0O

Host-Dependent

Personal Comput

40000

35000-

30000

25000 -

20000

15000

10000

5000

1985

1986

1987 1988 1989 1990

Source: Dataquest

June 1986

1.3-30 1986 Dataquest Incorporated July

CCIS Markets

1.3 Geographical Overview

T a b l e 1.3-14

F a r Eastern CAD/CAM M a r k e t by P r o d u c t Type

(Millions of Dollars/Actual Units)

1985

1986 1987 1988 1989

1990

All Product Types

Revenue

Systems

Workstations

Standalone

Revenue

Systems

Workstations

Host-Dependent

Revenue

Systems

Workstations

Personal Computer

Revenue

Systems

Workstations

953

8,262

13,521

1,150

17.370

21,158

1,394

22,488

26.430

1.683

30.475

34.421

2.022

41.085

44,724

2,426

55,689

58,599

128

1,270

1,270

691

1,487

6,746

134

5,504

5,504

303

4,078

4,078

688

1,275

5,063

160

12,017

12,017

576

8,736

8.736

625

1,211

5,153

192

12,541

12,541

929

16.159

16,159

550

1,108

5,053

204

13,209

13,209

1,365

27,263

27,263

457

926

4,566

200

12,896

12,896

1,898

42,987

42,987

344

652

3.561

185

12.050

12,050

CAGR

21%

46%

34%

71%

102%

102%

-13%

-15%

-12%

7%

17%

17%

Source:

Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July 1.3-31

1.3 Geographical Overview

Table 1.3-15

F a r E a s t e r n CAD/CAM M a r k e t by P r o d u c t Type

(Percent of Total)

Standalone

Revenue

Systems

Workstations

Host-Dependent

Revenue

Systems

Workstations

Personal Computer

Revenue

Systems

Workstations

1985 1986 1987 1988 1989 1990

13%

15%

9%

26%

23%

19%

41%

39%

33%

55%

53%

47%

68%

66%

61%

78%

77%

7Z%

73%

18%

50%

60%

7%

24%

45%

5%

19%

33%

4%

15%

23%

2%

10%

14%

1%

6%

14%

67%

41%

14%

69%

57%

14%

56%

47%

12%

43%

38%

10%

31%

29%

8%

22%

21%

Source: Dataquest

June

1986

1-3^-32 © 1986 Dataquest incorporated July CCIS Markets

1.4 Product Type Overview

This section refers to Figures 1.4-1 Revenue, 1.4-1 Shipments, 1.4-2, and 1.4-3, and Tables 1.4-1, 1.4-2, and 1.4-3.

Over the past three years, the CAD/CAM industry has changed from shared-logic, host-based systems to distributed engineering workstations and personal computers. This major transition has been smooth for some vendors but rocky for others, depending upon the vendor's level of commitment toward adopting a truly distributed product platform and whether or not the vendor was leading or following this trend. Dataquest believes that seven out of every ten

CAD/CAM workstations sold today are distributed-type products. We expect that this ratio will grow to more than nine out of ten workstations by 1990.

The personal computer, more specifically the IBM PC AT, has forever altered the shape of the CAD/CAM industry by bringing the cost of a relatively powerful workstation down to a level where the masses can enjoy some of the major benefits of CAD/CAM. We predict, however, that the major CAD/CAM system architecture of the future will be a combination of the personal computer and the standalone engineering workstation that we call the personal workstation. The personal workstation will contain the following system features:

• UNIX virtual memory operating system

• Ability to run MS-DOS programs

• Integrated bit-mapped graphics with 1-megapixel display

• Local area network connection (e.g., Ethernet, IBM Token-Ring)

• Communication gateways (e.g., MAP, 3270, ASCII terminal)

We offer the following observations regarding CAD/CAM systems architectures worldwide, including host-dependent, standalone, and personal computer systems:

• As prices continue to fall and the workstation becomes more of a commodity item, it will become increasingly difficult for the turnkey vendors to hide profit margins in bundled hardware/software configurations. We expect that a larger portion of revenue and profits will begin to be gained from the sales of software and services.

• Shared-logic, host-dependent systems are rapidly declining in popularity for use in interactive graphics applications. However, we see a major market forming for background computing and network servers.

• The use of application accelerators will increase as more discrete functions are moved from general-purpose software into application-specific VLSI.

CCIS Markets © 1986 Dataquest Incorporated July 1.4-1

1.4 Product Type Overview

COMPETITIVE EVALUATION

Measuring the technical merits of one workstation versus another is a very difficult task compounded by:

• The lack of consistent standards

• A phenomenon known as "vendor specsmanship," whereby the vendor publishes only those specifications that make its products look good and ignores those that do not

• The subjective nature of many features

• The effect that applications have on weighing the importance of one feature versus another

A particular case in point is the often-used millions of instructions per second

(MIPS) specifications. With today's simpler computing architectures employing microprocessor technologies and reduced instruction sets (RISCs), the types of instructions that these computers are processing differ dramatically from their mainframe ancestors. For example, a RISC computer that boasts 2 MIPS in computing performance may produce only a fraction of that speed when running a particular application due to the complexity of the operating software. Vendors are also guilty of quoting MIPS ratings on instructions that operate the quickest (such as an integer add) instead of advertising ratings that indicate performance over an average range of instructions.

Discussing the implications of quantifying workstation performance is beyond the scope of this report. Dataquest believes, however, that workstation buyers generally evaluate four major technical categories when making workstation purchases:

• Computing

• Graphics

• Networking/interconnectivity

• Application software

Each of these categories carries with it a unique set of specifications that are weighted by their particular importance within a given application and/or environment. As Figure 1.4-2 illustrates, Dataquest believes that the two dominant environments emerging within the design automation community are for low-end

2-D and high-end 3-D workstations.

1.4-2 © 1986 Dataquest Incorporated July CCIS Markets

1.4 Product Type Overview

Low-end systems typically contain the following features:

• 1 megapixel of display resolution

• Up to 16 colors

• 600 to 1,000 double-precision whetstone performance

• Execution and storage of MS-DOS programs

• Engineering documentation and data entry applications

High-end systems generally contain the following features:

• Greater than 1 megapixel of display resolution

• Greater than 256 colors

• High-performance graphic processors to perform near real-time viewing and shading functions

• 1,500 to 2,000 double-precision whetstone performance

• Engineering analysis and simulation applications

Low-End 2-D Environment

The low-end 2-D environment historically has been dominated by personal computers such as the IBM PC AT. Dataquest believes that the personal computer era in CAD/CAM will level off dramatically and eventually give way to the more powerful, low-cost generation of engineering workstations that were recently introduced. Our reasoning behind this prediction stems from our survey of

CAD/CAM end users who suggested that 32-bit, virtual memory, engineering workstations are more desirable than personal computers. (See Dataquest's

Research Newsletter number 84 entitled, "CAD/CAM End-User Survey.")

However, CAD/CAM end users also stated that price was ultimately the most important factor when considering workstation purchases, with $20,000 being an important economic target. Now that the new breed of workstations has crossed this critical price/performance barrier, Dataquest expects rapid expansion of this market segment. Our findings are further substantiated by some of the large, low-end workstation purchases recorded by General Motors' EDS, Hughes Aircraft, and Schlumberger. In each of these instances, the requirement for a 32-bit engineering workstation costing less than $20,000 was the principal purchasing criterion. None of these purchasers considered a personal computer because of its limited computing, graphics, and networking performance.

CCIS Markets © 1986 Dataquest Incorporated July 1.4-3

1.4 Product Type Overview

High-End 3-D Environment

The high-end 3-D workstation marketplace is driven by the need to push the interactivity of engineering applications such as solids modeling, PCB layout, and finite element modeling as close to real time as possible. While this segment of the market has experienced a high degree of user benchmark activity, Dataquest finds that high-end 3-D applications have had very little success within the end-user community due to the associated performance penalties. Dataquest believes that the new breed of high-end 3-D workstations that offer 1.5 to 2 times the performance of a VAX 11/780 at workstation prices will spawn a new awareness that 3-D capacity can in fact be accomplished productively. The software vendors have recognized this and have been converting their applications to take advantage of the

3-D display list capability of these new high-end workstations. This software conversion should allow 3-D applications to run much more efficiently by taking advantage of high-speed VLSI features on the 3-D machines and by eliminating a lot of the algorithmic gymnastics that take place when the software aione is left with the task of simulating the 3-D image.

AVERAGE PRICE PER SEAT

As illustrated in Table 1.4-3, Dataquest believes that the average price per seat of a turnkey system will drop 14 percent per year through 1990. This rate of decline is much slower than the 30 percent to 40 percent price declines the CAD/CAM market has witnessed during the past two years.

It is important to note that Dataquest expects workstation performance to continue to increase at a faster rate than the rate of price decline. Until now,

CAD/CAM workstation computing performance doubled approximately every two years. For the balance of this decade, however, Dataquest predicts that workstation computing performance will double every single year. For example, 2 MIPS

(millions of instructions per second) computing performance is common in

CAD/CAM workstations in 1986. In 1987, however, we expect computing performance to jump to 4 MIPS, with an expected rise to 8 MIPS in 1988.

1.4-4 © 1986 Dataquest Incorporated July CCIS Markets

1.4 P r o d u c t Type Overview

Figure 1.4-1 Revenue

Total CAD/CAM Market by P r o d u c t Type

Millions of Dollars

10000-

9000

Standalone

Host-Dependent

Personal Computer

8000

7000

6000

5000

4000

3000

2000

1000

1985 1986 1987 i9aa

1389 1990

Source: Dataquest

JUDC 19SG

CCIS Markets

1986 Dataquest Incorporated July

1.4-5

120000-

90000

60000

300D0

1.4 Product Type Overview

Figure 1.4-1 Shipments

Total CAD/CAM Market by Product Type

Worl<statlon Shipments

210000

• Standalone

• Host-Dependent

A Personal Computer rsoooo

150000-

1985 1986

1987 18S8 1989 1990

Source: Dataquest

June 1986

1.4-6 1986 Dataquest Incorporated July

CCIS Markets

Price

1.4 P r o d u c t Type Overview

Figure 1.4-2

CAD/CAM Workstation E n v i r o n m e n t

Low EIid

2D

Performance

High End

3D

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

1.4-7

1.4 Product Type Overview

Figure 1.4-3

Total CAD/CAM Market Average Frice per Seat

Thousands of Dollars

140-1

120

• Standalone

• Host-Dependent

A Personal Computer

100

80

40-

20Jt

1985

-A

1986

imr

1988

1989 1390

Source: Dataqoest lune 1986

1.4-8 © 1986 Dataquest Incorporated July CCIS Markets

1.4 P r o d u c t Type Overview

T a b l e 1.4-1

Total CAD/CAM M a r k e t by P r o d u c t Type

(Millions of Dollars/Actual Units)

1985 1986 1987 1988 1989 1990

CAGR

Totat Market

Revenue

Systems

Workstations

Standalone

Revenue

Systems

Workstations

Host-Dependent

Revenue

Systems

Workstations

4,849

65,212

82,056

5,863

88,769

107,051

7,116

118,891

139,497

8,624

157,873

180,471

3,253

5,395

22,240

3,289

5,939

24,221

3,172

6.077

26,683

2,993

6,002

28,600

10.397

211.532

234,056

2,617

5,297

27,822

12,511

283,682

304.055

1,066

11,828

11,828

1,812

24,194

24,194

2,947

45,015

45,015

4,546

79,711

79,711

6,680

133,802

9.328

210.545

133,802 210,545

2,143

4,120

24,493

Personal Computer

Revenue

Systems

Workstations

529

47,988

47,988

762

58,636

58,636

998

67,799

67,799

1,085

72,160

72,160

1,099

72,432

72,432

1,040

69.017

69.017

20.9X

34.2X

29.9X

54.3X

77.9%

77.9%

-8.OX

-5.2%

1.9X

14.5X

7.5X

7.5X

SOURCE: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

1.4-9

1.4 P r o d u c t Type Overview

T a b l e 1.4-2

Total CAB/CAM M a r k e t by P r o d u c t T y p e

(Percent of Total)

^9BS 1 ^ 6 t987 X9& t989 1990

Standalone

Revenue

Systens

WorltstfttfoIns

Rost'DependKTt

Revemtt

Systens

Utorkstatfons

Persons t Cosfuter

Revmue

Systens ttoricstations

22%

18X

f4X

3 W

27X

23X

41X

3ffie

3St

53X

sm

44X

64%

£3X

57%

75X

74X

69X

£7X ffiC

27X

56%

7%

ZiX

45X

5%

1918

35X

4X

%6X

25X

Vt

12X

17X

TX

8X

11%

74%

58X f3X

66%

55X

14X

57%

49%

13%

46X

40%

t t x

34X

3fX

ex

24X

23X

SOMCE: E>atac|uest

June 1986

1-4-10: © 1986 Dataquest IncwpOTated Jttly CCIS Markets

1.4 P r o d u c t Type Overview

Table 1.4-3

Total CAD/CAM M a r k e t Average Price p e r Seat

(Thousands of Dollars)

All Product Types

Standalone

Host-Dependent

Personal Computer

1985 1986 1987 1988 1989 1990 CAGR

56.0

69.1

130.1

20.6

55.7

57.6

111.7

19.2

46.2

50.0

95.1

18.0

40.0

43.0

80.5

16.8

34.4

36.8

67.3

15.5

29.6 -12%

31.5 -15%

55.2 -16%

14.1 - 7 %

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

1.4-11

1.5 Revenue Source

As illustrated in Figure 1.5-1 and Tables 1.5-1 and 1.5-2, Dataquest believes that hardware (including computers, graphics, and peripherals) accounted for

62 percent of C/UD/CAM revenue in 1985. We see hardware revenue falling to

46 percent of the market by 1990, with the balance comprised of software and service revenue. The implications of this trend are as follows:

• As hardware prices continue to fall, the turnkey vendors will find it more difficult to bury profit margins in bundled hardware/software configurations.

• Although hardware is declining as a percentage of gross revenue, hardware revenue is expected to reach $5.8 billion by 1990, up from nearly $3 billion in 1985.

• Personal computer hardware values are expected to rise over the next few years due to the expected sale of configurations with larger disk and memory configurations along with higher-performance graphics boards.

CCIS Markets, © 1986 Dataquest Incorporated July 1.5-i

1.5 Revenue Source

Figure 1.5-1

Total CAD/CAM Market Revenue by Revenue Source

1985

Hardware f \ Software

I I Service

1990

Sotnee: Itefitq>est

t.5-2

1986 Dataquest Incorporated July

CClS Markets

1.5 Revenue Source

Table 1.5-1

Total CAD/CAM Market by R e v e n u e Source

(Millions of Dollars)

All Product

Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

.

Host-Dependent

Hardware

Software

Service

Total

Personal Cotnputer

Hardware

Software

Service

Total

1985

1986 1987 1988 1989 1990

CAGR

2,996

1,213

639

4,849

3,590

1,521

752

5,863

4,185

2,016

915

7.116

4,791

2.676

1,158

8.624

5,337

3,530

1,530

10,397

5,807

4,611

2,092

12,511

14%

31%

27%

21%

541

405

120

1,066

955

652

206

1,812

1,524

1.073

350

2.947

2.273

1,701

572

4,546

3,169

2.587

925

6.680

4,098

3,757

1,473

9,328

50%

56%

65%

54%

2,101

643

509

3,253

2,124

633

532

3.289

1.998

628

546

3.172

1,808

620

565

2,993

1,466

567

584

2.617

1,065

479

599

2,143

-13%

•6%

3%

-8%

354

165

10

529

511

236

15

762

663

315

19

998

709

355

21

1.085

702

376

21

1,099

644

375

20

1.040

13%

18%

15%

14%

Source:

Dataquest

June 1986

#

CCIS Markets

1986 Dataquest Incorporated July 1.5-3

1.5 Revenue Source

At I Product Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal

CooIputer

Hardware

Software service

Total

Table 1.5-2

Total CAD/CAM Market by Revenue Source

(Percent of Total)

1985

1986

1987

1988

1989

1990

62X

25X

13X

100X

61%

26%

13%

100%

59%

28%

13%

100%

56%

31%

13%'

100%

51%

34%

15%

100%

46%

37%

17%

100%

51%

38% in

100X

53%

36%

11%

100%

52%

36%

12%

100%

50%

37%

13%

100%

47%

39%

14%

100%

44%

40%

16%

100%

65%

20%

16%

100%

65%

19%

16%

100%

63%

20%

17%

100%

60%

21%

19%

100%

56%

22%

22%

100%

50%

22%

28%

100%

67%

31%

2%

100%

67%

31%

2%

100%

66%

32%

2%

100%

65%

33%

2%

100%

64%

34%

2%

100%

62%

36%

2%

100%

Source: Dataquest

June

1%6

1.5-4

1986 Dataquest Incorporated July

CCIS Markets

#

#

2.1 Mechanical Definitions

The mechanical segment refers to CAD/CAM products that are typically used to support the design and manufacturing of components and mechanisms. The users are most often engineers, designers, or draftsmen involved in the design and documentation process. The following paragraphs give detailed definitions of the scope of the market comprised of end-user industries and the evolution of major

CAD/C/yvl applications. Later sections include an Executive Summary, a Market

Overview, a Market Forecast, and an in-depth assessment of emerging technologies.

DEFINrriON OF MECHANICAL CADlCAM MARKET

Dataquest has defined the mechanical CAD/CAM market in terms of the users of the technology and applications being used. The users are categorized by industry groupings, with typical products and organizations described. The major

CAD/CAM system applications defines a framework that allows a full analysis of the total CAD/CAM application area.

Refer to the following sections for a detailed definition and analysis of the mechanical CAD/CAM market:

• Definition by End-User Industry

• Definition by Major System Application

Dennition by End-User Industry

The mechanical CAD/CAM market is defined to include all of the manufacturing industries as shown in Figure 1.

Some of these industries certainly have a stronger need than others, but it is difficult to find any industry that does not use some mechanical component in its products or in manufacturing its products. Dataquest uses the U.S. Department of

Commerce's Standard Industrial Classification (SIC) codes to define the major industries using mechanical CAD/CAM tools. The top five manufacturing industries plus the Other group defines the CAD/CAM market. The corresponding industry and SIC number are aircraft (Code 372), automotive (Code 371), machinery

(Code 35), electrical (Code 36), and fabricated metal (Code 34).

Aircraft

CAD/CAM techniques are ideally suited to the aircraft/aerospace environment.

The large documentation requirements representing thousands of parts and assemblies are well suited to production by CAD systems. Complex design tasks are compounded by the proliferation of airframe models and features. In reality, each plane or vehicle is unique, requiring its own set of documentation for manufacturing and maintenance. The complete process from conceptual design through detail design, analysis, test, fixturing, manufacturing, and service/repair now uses CAD/C/VM technology.

CCIS Markets © 1986 Dataquest Incorporated July 2.1-1

2.1 Mechanical Definitions

Figure 2.1-1

Mechanical CAD/CAM

Manufacturing Industries

Source: Dataquest

June 1986

2.1-2 1986 Dataquest Incorporated July

CCIS Markets

2.1 Mechanical Definitions

The early stages of conceptual design are aided by solid modeling and realistic visualization techniques. As the design moves into the analysis and detail design phase, finite element stress analysis becomes important as a design tod.

Manufacturing gets involved designing tooling, fixtures, and processes that manufacture and bring all the components together in final assembly. Numerical control part programming has been one of the strongest CAM development areas in the aerospace industry. Computer-aided testing and quality assurance play an important function in guaranteeing that the original design was accurately built. The use of computer-aided tools does not end here. Computer graphics, technical publication, and artificial intelligence procedures are being combined into interactive, portable service, diagnostic, and repair workstations. The ongoing service and repair operations are becoming more efficient as a result.

The above brief examples are typical of the aggressive use of C/UD/CAM techniques in the aerospace design and manufacturing operation. Because

CAD/CAM techniques are used from start to finish, many benefits are realized by sharing data from one step to the next. Reduced errors, faster response to changes, and better control are some of the significant benefits.

Automotive

The benefits of proven CAD/CAM applications are found in abundance in the automotive industry. Similar to the aerospace industry, large documentation requirements and complex design tasks are common. A very competitive worldwide market, governmental controls, and rapidly increasing complexity in technology and material requirements are making the automotive industry more dependent on

C/\D/C/^M tools.

A description of the automotive design process starts with the stylist. The computer-aided engineering tools for vehicle concept and styling development are becoming well developed. Conceptual simulation and analysis software is being combined with visualization software to produce photographic-quality images of rendered surfaces. Animation techniques are being used to add motion to the realistic images. Engineering, advertising, and styling all can benefit from the moving simulations. But much more than pretty pictures are developed. Using the resulting mathematical data base, the same models can be tested for driver visibility, packaging, and, with more detail, for simulation of ride and performance characteristics.

When the body, power train, and chassis design groups get involved, the new car project is scheduled for production in as little as 18 months. The detailed design progresses, working from the outer surface toward the center of the fire wall. The 6,000 or more parts that make up a typical automobile are detailed, assembled, and verified. If designed properly, the doors will open, the lights will light, and the wheels will not fall off after the first chuckhole.

CCIS Markets © 1986 Dataquest Incorporated July 2.1-3

2.1 Mechanical Definitions

The manufacturing process is a complex choreography of purchased and manufactured parts with thousands of time-dependent milestones, resulting in the right part being at the right place for assembly. Manufacturing engineering is responsible for production tooling, including design for dies, molds, and sheet metal parts.

The manufacturing and assembly group is responsible for assembly layout, tool fabrication, and programming for the decision support and control computer systems. Numerical control part programming, material resource planning, computer-aided processing, robot programming, and process control programming are just a few of the supporting functions of this group.

Machinery

The products produced in the general machinery industry start with the most common parts such as nuts, screws, and washers. These are combined with cast, molded, and other machined components to make up the next tier of finished goods, which include saws, polishers, sprayers, drills, and mixers.

The mechanical CAD/CAM applications used in the aerospace and automotive industries are typical of those used in the general machinery industry but at a higher level of complexity. The manufacturing tolerances in the general machinery industries are not as stringent, the materials used are not as exotic, and the overall level of product sophistication is not as complex. There are exceptions, however, in medical, food, and other processing applications. The CAD/CAM tools are involved in all aspects of product, assembly, and component design as well as in manufacturing support for tooling, fixtures, and processes.

Electrical

Electrical and electronic machinery includes almost everjrthing that runs on electricity, such as appliances, cooking equipment, sewing machines, lighting fixtures, radios, television sets, and X-ray equipment.

The mechanical CAD/CAM applications required to design, document, and manufacture these products cover the full spectrum of today's capabilities.

Castings, forgings, and sheet metal enclosures are typical components in appliances and cooking equipment. Many molded cabinets, housings, and piece parts are used in consumer electronics and commercial equipment.

The added complication of designing products with both mechanical and electronic components requires close attention to the design goal and coordination throughout the manufacturing process. The design and manufacture of the electronic components is discussed in detail in later sections of the Market and

/^alysis binder.

The combined electromechanical market is targeted for an in-depth research project later this year.

2A-4 © 1986 Dataquest Incorporated July CCIS Markets

2.1 Mechanical Definitions

Fabricated Metal

Typical products produced in this industry include industrial fasteners, screw machine parts, valves, pipe fittings, and ball/roller bearings. Castings, forgings, extrusions, and bar stock are turned, coined, swaged, bent, and twisted to make these parts.

The CAD tools used to support the design and manufacture of these products range from basic drafting-only systems to full CAD/CAM and computer-aided engineering systems. Use of computerized tools has led to greater efficiency in small lot production. Numerical control (NC) machine tools can effectively produce one-off prototype parts or small production runs of up to several hundred parts.

The increased precision in NC manufacturing has allowed some valve manufacturers to upgrade the pressure and temperature specifications of their valves. The use of CAD/CAM tools allows quicker response to customer requests, giving the small manufacturer a significant advantage.

Other

The Other manufacturing industries comprise a great variety of sometimes large industries that have varying levels of experience and success in using CAD/CAM technology. As a group, the number of users is fairly large, but the CAD/CAM applications used are extremely diverse. A brief list of manufacturing industries in this group will illustrate the issue. These industries include: food, apparel, lumber products, furniture, bathroom fixtures, railroad equipment, instruments, watches, games, and caskets. The opportunity for niche product development in this group is large. Vendors interested in developing effective tools for these markets must have extensive user application experience to guarantee useful results.

Deflnition by Major System Application

Dataquest uses four common system usage groups for comparison, aiding in the organization of information in each of the CAD/CAM application segments.

These groups are documentation, design, analysis, and manufacturing, as shown in

Figure 2.

Documentation

Considering the diversity of complex machinery that has been designed and tediously drafted with pen and paper, it is no surprise that a step forward in automating the drafting process has been received with open arms. The drafting process is defined by simulating the manual process of generating layout, detail, and assembly drawings in a CAD system. Each line, circle, and piece of text is created and placed with the appropriate system command, allowing the user to build the drawing. Advantages inherent in CAD technology allow rapid revision of the stored data with fast duplication and overlay techniques.

CCIS Markets © 1986 Dataquest Incorporated July 2.1-5

2.1 Mechanical Definitions

Figure 2.1-2

Mechanical CAD/CAM

Markets—Manufacturing Industries

/

/

y^

/

Documentation

Design

Analysis

Manufacturing

Major Applications

Source: Dataquest

June 1986

2.1-6

1986 Dataquest Incorporated July

CCIS Markets

2.1 Mechanical Definitions

The major documentation, drafting, and schematic applications are:

• Detail drafting

• Layout

• Assembly/subassembly

• Charts

• Hydraulic and pneumatic schematics

• Technical illustration/documentation/publication

Design

The general trend in computer graphics is toward design simulation. Design in this context is typically a three-dimensional problem where component parts are fit together, defining the assembly. The amount of detail in these models varies from a few lines and circles to very complex assemblies with every surface and corner precisely defined.

An essential system function is the ability to view the design from any orientation. Combining the ability to model part geometry with the viewing functions gives the designer a powerful design tool. The common user expectation is to be able to produce a better design using CAD but with the same time investment.

The major design applications are:

• Part modeling

• Visualization

• Assembly design and verification

• Clearance and assembly studies

• Linkage/mechanism design

Analysis

Analysis is entwined in the design process. Making sure all the parts fit together and meet the design goals is the most common type of analysis. As the modeling process has improved, so have the analytical tools to evaluate the models.

/ ^ example is finite element mesh modeling and analysis. This general technique

CCIS Markets © 1986 Dataquest Incorporated July 2.1-7

2.1 Mechanical Definitions has at its roots a divide-and-conquer procedure for simplifying the calculation required to evaluate thermal or structural properties of the design. These calculations can be performed for two- or three-dimensional analysis. By defining the conditions of the structure where it attaches to other components, the design can be twisted, pulled, and shaken, all using computer simulation. The tedious effort of setting up a typical test and waiting for the results has been shortened from days to hours. Unfortunately, hours can seem like days when the axles are breaking off your trucks and you do not know why. If the analysis could be done in minutes, more analyses would be done earlier in the design process, improving product reliability.

Major analysis applications include:

• Mass properties

• Component/assembly deformation and stress

• Thermal

• Structural

• Vibration

• Magnetics

• Dynamic

• Fatigue

• Composite materials

Manufacturing

In many respects, the applications and benefits of using computer-aided drafting, design, and analysis all apply to the manufacturing operation. Sharing the product design data base is a good start in improving the operation, but it is just the beginning. Many drawings are generated for production equipment construction and documentation. Tools and fixtures need to be designed or redesigned for the next product revision. The full range of simulation and analysis tools are valuable in optimizing the manufacturing process. Part geometry is being used to define the tool cutting path on a numerically controlled mill, iathe, drill, or other machine tool. Robotic work cell simulation is a major CAM application in development. In general, the use of C/^vl in manufacturing has the biggest potential for productivity gains, resulting in improved profitability for the user company.

2.1-8 ©1986 Dataquest Incorporated July CCIS Markets

2.1 Mechanical Definitions

Major manufacturing C/yD/CAM applications are divided into two groups: manufacturing engineering and process simulation/interface.

Manufacturing engineering includes:

• Fixture and tool design

• Sheet metal development

• Part processing

• Quality control

• Group technology (classification and coding)

Process simulation includes:

• Numerical-controlled machine tool programming (DNC and CNC)

• Nesting and flame cutting

• Tube bending

• Coordinate measuring machine

• Robotics (machine loading, assembly, and spot welding)

• Material-handling systems

• Programmable controllers

Other important computer applications are in use in the manufacturing environment but are not included in the CAD/CAM evaluation. These other applications are:

• Manufacturing resource planning

• Production and inventory control

• Shop floor control

CCIS Markets © 1986 Dataquest Incorporated July 2.1-9

2.2 Mechanical Executive Summary

This summary highlights the key points and analyses discussed throughout this chapter. Please refer to the chapter in its entirety for a comprehensive analysis of the mechanical application segment.

• Mechanical CAD/CAM revenue was $2,677 million in 1985 and is forecast to grow to $3,226 million in 1986 and to $6,760 million in 1990.

• The estimated total number of mechanical CAD/CAM workstation units shipped in 1985 was 40,635. Dataquest forecasts that 53,568 units will be shipped in 1986 and 176,265 units in 1990.

• Dataquest forecasts that workstation units in the mechanical CAD/CAM market will grow at 34 percent CAGR for the next five years.

• The personal computer has grown from a minimal workstation share in

1982 to represent more than 56 percent of the workstations shipped in

1985.

• The average mechanical workstation price dropped to $68,100 in 1985, and is projected to drop to $58,400 in 1986 and to $27,300 in 1987.

• The predominance of drafting as an application of the low-end CAD product will fade as higher-performance/low-cost processors become available and as users demand the full repertoire of application software.

• The desktop environment is being viewed by vendors as the prime market for attracting the masses to CAD/CAM products. High user acceptance of the total solution will require full applications support, networking, and easy-to-use, reliable products.

• Some of the fastest application growth areas in the next two years will be:

— Computer-aided engineering for mechanical applications, including design simulation, solid modeling, and finite element analysis

— The manufacturing environment; well-integrated manufacturing software products to become more widespread as C/VD/C/^M moves into the shop area

— The combined electrical and mechanical application; vendors who have historically focused on the mechanical or electrical applications to provide integrated packages

CCIS Markets © 1986 Dataquest Incorporated July 2.2-1

2.3 Mechanical Market Overview

HISTORY

The early and mid-1960s saw the emergence of computer graphics as a practical tool. Some of the earliest graphics work was developed for the military using mainframe computers. Massachusetts Institute of Technology was an early contributor, providing a training ground for pioneers in this field such as S. Coons,

L Sutherland, and S. Chasen. In the late 1960s, the basic elements of computer, display, and software came together to form the first commercial turnkey CAD systems. The first systems were focused on printed circuit layout and were only able to draw straight horizontal and vertical lines. The users immediately began asking for more features. An early enhancement, two-dimensional drafting, made

CAD practical for mechanical applications. Computervision and Applicon were formed in 1969 to supply these primitive two-dimensional CAD tools.

The early 1970s witnessed essential development for the mechanical applications, as P. Bezier, H. Gouraud, E. CatmuU, and W. Gordon completed their basic research in curve surface definition and display. By the mid-1970s, this research was being used in the first three-dimensional design systems. The designer could now String wires and some surfaces in three dimensions. Fontaine

Richardson, Patrick Hanratty, Gerry Devere, and David Albert are some of the key figures who took the research of the day and turned it into usable CAD products.

Industry giants such as Lockheed, Matra, and General Motors early understood the value of computer graphics and developed internal systems that are still in use today. In fact, some of their original products are the basis of today's successful commercial CAD products such as CADAM and Euclid. The 500 plus companies that currently make up the CAD/CAM industry accumulated more than $4.8 billion in revenue in 1985.

THE PRESENT

Today's CAD/CAM market has emerged as an essential ingredient in the worldwide trend toward factory automation. For a better understanding of the progress of this trend in four major mechanical industries, refer to Table 2.3-1.

This table defines the size and growth rate of each major industry.

Work Environment

The current CAD/CAM work environment in each of the major SIC code areas is very similar, but with some unique variations. Drafting standards are well defined for all industry segments. Design tasks for a car door and a cargo bay hatch are quite similar, depending on size or performance characteristics. Unique design and manufacturing problems do occur, but the CAD/CAM systems are generally flexible enough to be custom tailored for the job.

CCIS Markets © 1986 Dataquest Incorporated July 2.3-1

2.3 Mechanical Market Overview

Table 2.3-1

Analysis and Forecast of Major Industries Using Mechanical CAD/CAM

1982

1984 1986*

CAGR

1984-1986

Aerospace Industry

SIC 372, 376

Value of Shipments

Value of Imports

Value of Exports

Total Employment

Motor Vehicle Composite

SIC 37Ix

Value of Shipments

Value of Imports

Value of Exports

Total Employment

Composite Metal Working, General and Special Industrial

Machinery

S I C 35XX

Value of Shipments

Value of Imports

Value of Exports

Total Employment

Composite General Components and Stampings

S I C 34XX

Value of Shipments

Value of Imports

Value of Exports

Total Employment

* Forecast based on ITA forecast

$

$

$

$

66,466

4,242

15,335

685,000

$

112,270

$

$

22,713

10,352

$ 615,200

$ 80,050

$ 4,664

$ 15,105

$713,000

$ 96,582

$ 6,028

$ 19,310

$759,000

$178,517

$ 43,240

$ 10,510

$784,700

$160,366

$ 38,445

$ 12,554

$712,100

$ 92,026 $ 94,059

$ 7,734 $ 10,680

$ 21,571

$1,011,300

$ 16,331

$956,000

$ 94.962

$ 13,318

$ 16.664

$934,100

$

23.651

$

1.501

$

2.487

$

299.700

$ 30,890

$ 31,198

$ 980 $ 2,505

$ 2,220

$321,900

$ 2,649

$327,000

9.8%

13.7%

13.1%

3.2%

(5.2%)

(5.7%)

9.3%

(4.7%)

0.5%

11.7%

1.0%

(1.2%)

0.5%

59.9%

9.2%

0.8%

Source: U.S. Industrial Outlook—1986

International Trade Administration (ITA)

2.3-2

1986 Dataquest Incorporated July

CCIS Markets

2.3 Mechanical Market Overview

Today's complex product design and manufacturing environment requires a staff with many talents. Mechanisms, electronics, hydraulics, and pneumatics often are used in the same design. New materials and manufacturing processes are being developed to lower the cost and maintain acceptable performance. More stringent legislation for noise or emission pollution is creating many design challenges.

The present manufacturing environment is tough, with shorter product life cycles and a rapidly growing list of competitors from all over the worid. The best chance for success is based on building the right products at the right time, and

Operating more efficiently than the other competitors. More and more product design and manufacturing groups are turning to CAD/C/VM to help make it happen, and many success stories have been documented. It is no longer a question of will

CAD/CAJA work, but of which system should be used and how the operation will improve as a result.

System Usage

Dataquest uses four common system usage groups for comparison: drafting, design, analysis, and manufacturing. A 1985 Dataquest user survey determined the percentage split of system use for mechanical applications:

• Drafting and schematic—52 percent

• Design—31 percent

• Analysis—7 percent

• Manufacturing—10 percent

(See CAD/CAM Industry Service Research Newsletter No. 84, entitled

"1985 CAD/CAM User Survey Results," for a detailed analysis of our survey.)

The following paragraphs present a brief analysis of each usage group.

Documentation

The importance of the engineering document cannot be over emphasized. It represents the legal description and bible of knowledge that fully specifies the product and every manufacturing process required to produce it. Each department in a manufacturing organization receives some form of drawing, puts in its value added in the form of detail or specifications, and passes on the package of documents to the next group. The sketch of a new product or product revision starts the process. The owner manual or installation guide shipped with the product is the end of the process. A design revision starts another cascade of documents through the organization.

CCIS Markets © 1986 Dataquest Incorporated July 2.3-3

2.3 Mechanical Market Overview

The CAD vendors have gone to considerable lengths to develop effective systems to expedite the design-to-drawing generation process. At least 50 percent of the design work is done in conjunction with the drawing. This is true in the aerospace, automotive, machinery, and fabrication industries.

Continued dependence on the drawing is a strong factor in the dramatic increase in low-cost drafting CAD systems. As users become more experienced, their need for more functionality also increases. This applies to enhanced drafting operation and performance as well as expansion into other CAD/CAM applications.

Design

Product design falls into two fairly distinct groups—new product development and existing product enhancement. The essence of the difference suggests starting with a clean sheet of paper versus enhancing an existing design that is already in production. CAD tools are equally suited for either activity, hi fact, a real opportunity exists to improve design process productivity by sharing the CAD data base between new product design and existing product development.

The design process begins with a problem. The solution can take a few moments or years, with the real possibility of no practical solution being found. For an experienced designer it sometimes seems all that is required is the back of an envelope and a tough problem to start the creative juices flowing. The "ah-ha," or moment of inspiration, begins the design process. The primary benefit of the CAD system provides an efficient means of documenting the design process and assists in proving the concept.

Analysis

Analysis starts shortly after the moment of inspiration, which occurs in the design process, /^alysis begins with what-if scenarios and continues with an impressive array of analytical tools that simulate everything from the weight and color of a part to its modal signature as it vibrates.

Low-cost and high-performance general-purpose computers are ideally suited to complement the design process with responsive and affordable analysis processing.

The list of analysis applications is getting longer and now includes stress, thermal, mechanism, dynamic, electromagnetic, and mass properties. The major analysis applications are utilized to simulate the product in its as-used environment and as it progresses through the various stages of manufacturing. Analytical tools are useful in every stage of the product design and manufacturing processes.

The combination of CAD/C/^M tools for design and analysis is named

Mechanical Computer-Aided Engineering (MCAE). This was the topic of a recent

Dataquest Research Newsletter (number 1986-11) and of a panel discussion at the

1986 annual conference. Please refer to the newsletter for more information on this application area.

2.3-4 © 1986 Dataquest Incorporated July CCIS Markets

2.3 Mechanical Market Overview

Manufacturing

The manufacturing process takes the result of design and analysis and turns it into chips and pallets of finished parts waiting for assembly. A large support team of professionals keeps the operation running smoothly, including tool makers, maintenance, and quality-assurance personnel. The automotive industry has been the most aggressive in replacing the blue-collar worker with flexible machining centers and automated material-handling equipment, but competitive pressures are now forcing the factory automation issues in all major industries. CAD/CAM systems are an integral part of this operation.

Simulation of numerically controlled machine tools, which generates the program to control the actual manufacturing process, is one of the most common

CAM applications. The use of CAD/CAM tools in manufacturing is much more than numerical control (NC) part programming. Jigs, fixtures, tooling, test equipment, material handling, packaging, and dozens of other manufacturing-related tasks use CAD/CAM.

The combination of computer graphics with data for shop control, schedules, material resource planning, and bill of materials generation is having a positive effect on the smooth operation on the shop floor. A significant opportunity is available for the vendors to provide integrated systems for these applications.

TRENDS

Applications

• Dataquest believes that drafting will remain the major selling application in

CAD/CAM for the next few years. This is due to the following:

— The low-cost drafting-only system is functional.

— It is easy to justify.

— It is not threatening.

• Design tools are being developed that meet the real needs of the designer.

The trends in this evolution include three-dimensional modeling of any realizable object using realistic imaging and conceptual design techniques.

The resulting accurate data base supports the foUow-on manufacturing and documentation applications. Rule-based design tools are also being developed to aid the designer in similar part design and design procedures.

• Mechanical Computer-Aided Engineering (MCAE) is the fastest growing segment in mechanical applications. Products from turnkey and software-only vendors are being developed to meet the conceptual and product design and analysis needs of the engineer and designer.

CCIS Markets © 1986 Dataquest Incorporated July 2.3-5

2.3 Mechanical Market Overview

The systems discussed above will provide a solid foundation for a staggering array of applications software. The major CAD/CAM applications have been implemented. These are being enhanced and are becoming easier to use and more productive. New applications will address more extensive design and simulation tasks.

Full application integration will be provided to minimize the system overhead and improve user interface. Customization by the user will be necessary in order to take full advantage of these tools.

Major factory automation projects are under way in all major manufacturing industries. The full implementation of computer-aided technology in the manufacturing environment is moving from the test tube to the real world. The automotive industry is the leader in developing and implementing robotics, flexible machining centers, just-in-time plant inventory, and shop floor communications data format.

Technology

• The total system package price will continue in a downward trend as component prices fall. Value-added hardware and applications software will tend to keep system prices above the commodity level.

• The trend in personal computer-based products to upgrade to higher-performance processors, memory, storage devices, and display is causing an increase in average system configuration. At the same time, the drop in component prices is resulting in a near constant package price for a

PC-based system.

• The need to rapidly communicate accurate engineering information among many organizational groups is driving the development of low-cost local area networks. The hardware is available but the software lacks the ability to provide full system security and management control functions.

• Integrated systems using personal computers, standalone workstations, and mainframe computers are evolving, taking advantage of the best each has to offer.

• Developments in computational resources, including application-specific integrated circuits, are raising performance to previously dreamed-of levels.

• The performance of graphic display is improving, and at a lower package price. Application-Specific integrated circuits and low-cost display memory are supporting this evolution.

2.3-6 © 1986 Dataquest Incorporated July CCIS Markets

2.3 Mechanical Market Overview

User Expectations

• The easy-to-use user interface typical of PC-based software is creating an expectation in the minds of the users. Software should be easy to use with minimal training required and built-in tutorial functions.

• The level of integration is expected to improve at the data base, user interface, application, and system management levels.

• The diversity of hardware options is increasing in primary system components as well as in peripherals. Computational servers, laser printers, and scanners are a few new-generation peripheral options.

• The functional level of the system is improving in all price groups for all applications.

• System reliability and support are improving as vendors respond to the basic expectations of the users.

• Many of the graduating engineers and technicians have used CAD/CAM technology in school and are demanding these tools when they enter the job market.

• Users are more interested in becoming system integrators, pulling together systems with off-the-shelf hardware and software. If the price premium for a package deal or turnkey solution is not too high, the benefits of a single-source supplier are still desirable.

DRIVING ISSUES

Industries

• The general trend in 1986 in all major mechanical industry sectors is toward increased levels of product shipments with continued growth in the next few years.

• Non-U.S. competition is growing, focusing added pressure on the critical long-term issues of cost control, improved product quality, and products that offer enhanced customer appeal.

The use of new materials is forcing the need for higher levels of design, analysis, and manufacturing development.

CCIS Markets © 1986 Dataquest Incorporated July 2.3-7

2.3 Mechanical Market Overview

CADlCAM Technology

• CAD/CAM technology has been identified as an integral component in the modernization of manufacturing industries.

• The aggressive marketing and product development of IBM is designed to maintain its world leadership position as the number one computer supplier. This is forcing the software developers to make IBM one of the computing options.

• Integration of application software is a strong driving factor in CAU/CAM system development; i.e., hardware and software must function togedier as a unified system.

• Improved user interfaces must allow effective system utilization that logically supports the complete design and manufacturing process.

• Continued enhancements in the semiconductor industry are improving the performance of computers and related peripherals. The price/performance ratio is expected to continue to improve by a factor of two every other year for the foreseeable future. (This may be a bit conservative in the short term.)

• Standards in graphics displays, data base transfer formats, and communications protocol are being used. Large users are demanding that vendors support standards allowing communication among different vendor systems.

• More emphasis is being placed on tiie availability of management tools for the control and manipulation of information systems.

• Company-to-company graphics data transfer is becoming a common requirement, particularly in the automotive sector.

OPPOMmNnHES

At the Low End

Low-cost standalone or low-end networked systems for text and part-time graphics operations

Limited applications software filling niche markets with low-cost products

(e.g., Ibw-resoiution technical publications)

2.3-8 © 1986 Dataquest Incorporated July CCIS Markets

2.3 Mechanical Market Overview

• Add-on hardware to enhance special-purpose applications (e.g., a scanner for raster image input)

• Interactive drafting systems with interfaces to higher-end products

(provides upward growth path)

• Innovative training techniques for low-cost systems

At the Midpoint

• Department-oriented general-purpose systems that do the whole job with higher performance

• Networks with low-end systems taking advantage of the best features of both types of systems

• Special-purpose processors for applications that require significant computing horsepower (e.g., analysis, real-time simulation, and image processing)

• New input devices to improve user interface to high-performance systems

At the High End

• Corporate-oriented large systems (500 plus users) with complex data base requirements and diverse applications software

• Applications requiring massive data base access and manipulation

#

CCIS Markets © 1986 Dataquest Incorporated July 2.3-9

2.4.1 Total Mechanical CAD/CAM

This section covers the total mechanical CAD/CAM market for all regions and product types. Figures 2.4.1-1 Revenue and 2.4.1-1 Shipments and

Table 2.4.1-1 reflect these data.

• The mechanical segment was an estimated $2,677 million in 1985 and is forecast to grow to $6,760 million in 1990, at a compound annual growth rate (CAGR) of 20 percent.

• Dataquest estimates that revenue will increase 22 percent in 1986, reaching

$3,266 million.

• Workstation shipments in 1985 were an estimated 40,635 units; shipments are expected to reach 176,265 units in 1990, growing at a 34 percent

CAGR.

CCIS Markets © 1986 Dataquest Incorporated July 2.4.1-1

2.4.1 Total Mechanical CAD/CAM

Figure 2.4.1-1 Revenue

Mechanical CAD/CAM—Worldwide

Millions of Dollars

7000-

4200

3500

2800

6300 r

5600

4900

2100

1400

700

III

'%••.; „ ; \

VxW^'

':-S>'S:%

I •\ ••-,. C--S

-•..;\%SS

^

"'\-Sr

1985 1986

? ^ ^ ^

^m^

\ ",-

V %. •*

KQ5^^^

1987

SXVv] t . \ x X V

^ ^

v W ^ . v>".>X

1988 1989

s;<?

1990

Source: Dataquest

June 1986

2.4.1-2 1986 Dataquest Incorporated July

CCIS Markets

Workstation Shipments

180000-

160000

140000

120000-

100000

80000-

60000

40000

20000

^•NNy''

^

V ^ V C '

198S 1986

2.4.1 Total Mechanical CAD/CAM

Figure 2.4.1-1 Shipments

Mechanical CAD/CAM—Worldwide

1387

!5i:

1986 rvCV-'/'N f ' W ^ ^ ^

W

• > . - , / % ' % % , ' "

C>1.V>>,

.XV

Ky^"^ vvv*w A

^ ; $ ! ^

\%.X/*,.\

' \ V \ " v \

sSSS*

ii^l

fc?J&

1990 1989

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July

2.4.1-3

2.4.1 Total Mechanical CAD/CAM

Table 2.4.1-1

Mechanical CAD/CAM—Worldwide

Total Applications

(Millions of Dollars/Actual Units)

1985 1986 1987 1988 1989 1990 CAGR

Total Market

Revenue

Systems

Workstations

2,677

29,632

40,635

3,266

42,232

53,568

3,952

59,457

71,909

4,742 5,664 6,760 20.4X

83,537 118,473 167,133 41.3%

96,607 130,282 176,265 34.1%

Source: Dataquest

June 1986

2.4.1-4 © 1986 Dataquest Incorporated July CCIS Markets

2.4.2 Mechanical Market Shares

This section includes Dataquest's forecasts and analysis of the mechanical market share distribution. Figure 2.4.2-1 and Table 2.4.2-1 reflect these data.

• IBM and Computervision continued to dominate the mechanical market in

1985 with 29.3 percent and 11.4 percent market shares, respectively, worldwide.

• IBM gets over 90 percent of its CAD/CAM revenue from the mechanical application area.

• Computervision generated a surprising 55 percent of its revenue from

European sales and support.

• Of the top three vendors, only Intergraph managed to gain market share in

1985. Mechanical applications now represent over a third of the revenue of the company.

• McDonnell Douglas is continuing to be aggressive in going after mechanical CAD/CAM.

• Prime almost doubled its revenue in 1985; its market share rose to

4.2 percent.

• Applicon also gained share in 1985, but this was due to the joining of

Applicon and MDSI at midyear. MDSI represented about $45 million of the

Applicon total.

• Control Data more than doubled its 1984 revenue, rising to 3.5 percent market share in 1985.

• Calma has lost market share, moving from fifth place in 1984 to eighth in

1985.

• Hitachi is a new name on the top 10 list. It has been doing very well selling its products only in Japan.

• Hewlett-Packard is also new on the top 10 list.

• The Other 116 mechanical CAD/CAM vendors represented 29.4 percent of the market.

CCIS MarJcets © 1986 Dataquest Incorporated July 2.4-1

2.4.2 Mechanical M a r k e t Shares

Figure 2.4.2-1

Mechanical Market ShareWorldwide

1985

Hewlett-Packard

1.9%

Hitachi

2.2%

Control Data

3.5%

Source: Dataquest

June 1986

2.4-2

1986 Dataquest Incorporated July

CCIS Markets

2.4.2 Mechanical Market Shares

Table 2.4.2-1

Mechanical Market Share—Worldwide

(Millions of Dollars)

COMPANY

1985

REVENUE

1985

SHARE

IBM

ConIputervision

Intergraph

McAuto

Prime

Applicon

Control Data

Calma

Hewlett-Packard

Matra Datavision

Auto-Trot

Cimlinc

Ferranti

Grafteic

Gerber Systems

MacNeal Schwendler

SDRC

Holguin-CAD

Autodesk

Other Computer Companies

Other Europe Companies

Other Far East Companies

Other Turnkey and Software

All Companies

$ 783

$ 304

$ 165

$ 139

$ 112

$ 111

%

9 3

%

7 0

$ 50

$ 35

$ 33

$ 32

29.3%

11.4%

6.2% •

5.2%

4.2%

4.1%

3.5%

2.6%

1.9%

1.3%

1.2%

1.2%

$ 26

$ 24

t

22

$ 20

$ 13

$ 13

$ 11

$ 75

$ 133

$ 344

2.8%

5.0%

12.9%

$ 70

$ 2,677

2.6%

100.0%

1.0%

.9%

.8%

.7%

.5%

.5%

.4%

Source:

Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July 2.4-3

2.4.3 Mechanical Regions

This section includes Dataquest's forecasts and analysis of the mechanical market, segmented by region. Figures 2.4.3-1 Revenue and 2.4.3-1 Shipments and

Tables 2.4.3-1 and 2.4.3-2 reflect these data.

• We estimate that the expected 22 percent grovrth in revenue from 1985 to

1986 will be evenly distributed over four market regions. Dataquest expects the Far East region to make a slight gain in market growth at the expense of the North American and European regions.

• We expect that 50 percent of the annual revenue and 46 percent of the system/workstation shipments to be in the United States in 1986.

• The growing number of non-U. S. vendors are expected to do well in their home markets, displacing U.S. products.

• Domestic vendors will require a concerted effort and strategic alliances with local distributors in Europe and Japan to maintain a significant market share. The next two years will provide the largest opportunity window to gain market recognition and share.

CCIS Markets © 1986 Dataquest Incorporated July 2.4.3-1

2.4.3 Mechanical Regions

Figure 2.4.3-1 Revenue

Mechanical CAD/CAM by Region

2400

2000

1600

1200

800

Millions of Dollars

32m

2800

X

North America

Europe

Far East

ROW

400-

1985 1986

1987 1988

1989

1990

Source: Dataquest

June 1986

2.4.3-2 © 1986 Dataquest Incorporated July

CCIS Markets

2.4.3 Mechanical Regions

Figure 2.4.3-1 Shipments

Mechanical CAB/CAM by Region

Workstation Shipments

80000 -

X

70000 -

North America

Europe

Far East

ROW

60000-

50000-

40000 -

30000 -

20000 -

i

10000-

1985

0 )

fi • ~

1986

X

[

1987

X

[

1988

*

- X Ji

1

1969

1990

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

2.4.3-3

2.4.3 Mechanical Regions

Table 2.4.3-1

Mechanical CADICAM

Application by Region

(Millions of Dollars/Actual Units)

IMS

198&

1987 1988 1989 1990

CAM

Total MMiiet

Revenue

Systems

Workstations

2,677

29.632

40,635

3,266

4 2 . ^ 2

53.568

3,952

59,457

71,909

4,742

83,537

118,473 167.133

96,607

5,664

6.760

130,282 176.265

20.4X

41.3X

34.IX

North Anerica

Reveixie

Systems

Workstations

1.334

13,583

17,606

1,626

18,834

24,506

1,967

27,053

33,365

2,359

38.055

44,873

2,817

55,682

61,803

3,361

80,346

8 4 , % 3

20.3X

42.7X

37. OX

Europe

Revenue

Systems

Workstations

713

11,107

14,300

871

12,510

15,456

1,054

18,536

21,605

1,265

25,978

29,039

1,512

35,172

37,956

1,805

47,831

50,045

20.4X

33.9X

28.5X

Far East

Revenue

Systems

Workstations

589

4,771

8,411

719

10,366

12,910

870

12,879

15,774

1.044

17,962

20,980

1,248

25,447

28.205

1.490

36.001

38,172

20.4X

49.8X

35.3X

Rest of World

Revenue

Systems

Workstations

41

170

318

50

522

697

61

988

1,165

73

1,542

1,714

87

2,172

2,319

104

2,954

3,066

20.4X

76.9X

57.3X

Source: Dataquest

June 1986

2.4.3-4

1986 Dataquest Incorporated July

CCIS Markets

2.4.3 Mechanical Regions

Table 2.4.3-2

Mechanical CAD/CAM

Application by Region

(Percent of Total)

1985

1986 1987 1988 1989 1990

North America

Revenue

Systems

Uorlcstatlons

Europe

Revenue

Systems

Workstations

Far East

Revenue

Systems

Uorlcstations

Rest of World

Revenue

Systems

Worlcstations

SOX

46%

43%

SOX

46X

46X

SOX

46X

46X

SOX

47X

47X

SOX

48X

48%

27X

37%

35X

27X

30X

29X

27X

31X

30X

27X

31X

30X

27X

30X

29X

27X

29X

28X

22%

16X

21X

22X

25X

24X

2X

IX

IX

SOX

45X

46X

2X

IX

IX

22X

22X

22X

22X

22X

22X

2X

2X

2X

2X

2X

2X

22X

21X

22X

22X

22X

22X

2X

2X

2X

2X

2X

2X

Source: Oataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

2.4.3-5

2.4.4 Mechanical Product Type

This section includes Dataquest's forecasts and analysis of the Mechanical

CAD/CAM market, segmented by product type. Figures 2.4.4-1 Revenue and

2.4.4-1 Shipments and Tables 2.4.4-1 and 2.4.4-2 reflect these data.

• The compound annual growth rate (CAGR) in total revenue from

1985 through 1990 is expected to be 20 percent. This growth will take the

$2,677 million in 1985 to $6,760 million in 1990.

• In the short term, from 1985 to 1986, the growth rate is expected to be

22 percent.

• System shipments are expected to grow 32 percent from 1985 to 1986 and at a 41 percent CAGR from 1985 through 1990.

• The standalone systems are gaining percentage from both PC and host-based systems.

• The growth rate in units shipped for personal computer-based systems will be 28 percent from 1985 to 1986. This is a dramatic slowdown from the

150 percent growth rates of 1985. The trend is expected to continue with less than an 11 percent gain from 1987 to 1988. The CAGR for

1985 through 1990 is expected to be 23 percent in revenue and 11 percent in units shipped.

• Standalone systems are more dramatic, showing estimated growth from

1985 to 1986 of 134 percent in revenue and 166 percent in units shipped.

The sustained high growth rate from 1987 to 1988 is expected to be a still significant 76 percent in revenue and 105 percent in unit shipments. This expected growth will result in the highest CAGR by product type from

1985 through 1990, which is forecast to be 76 percent in revenue and

105 percent in workstations.

• Host-dependent systems have reached a plateau, holding relatively constant revenue and unit volume throughout 1987. A rapid decline from there results in a negative 11 percent CAGR in revenue and a negative 5 percent in workstation shipments from 1985 through 1990.

CCIS Markets © 1986 Dataquest Incorporated July 2.4.4-1

2.4.4 Mechanical Product Type

The host-dependent products dominated 1985 revenue by a decisive

81 percent. Host-dependent systems are expected to represent the highest revenue share until 1988, when they wili be overtaken by standalone systems. The estimated 41 percent share in total revenue in 1988 will be derived from a small 17 percent of workstation unit sales.

Personal computers peaked in 1985 as a percentage of system shipments.

The 76 percent of systems in 1985 will drop to an estimated 23 percent in

1990. Revenue as a percentage of the total industry is expected to peak in

1987 at 15 percent.

The growth leader is forecast to be standalone products, representing

11 percent revenue and 12 percent system shipments in 1985. This is expected to expand to 74 percent revenue and 76 percent system units in

1990.

2.4.4-2 © 1986 Dataquest Incorporated June CCIS Markets

2.4.4 Mechanical Product Type

Figure 2.4.4-1 Revenue

Mechanical CAD/CAM by Product Type—Worldwide

2500-

2000-

1500

1000

500

Millions of Dollars

5000

Standalone

4500

Host-Dependent

Personal Computer

4000

3500

3000

1985 1986 1987

1988

19S9

1930

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

2.4.4-3

2.4.4 Mechanical Product Type

Figure 2.4.4-1 Shipments

Mechanical CAD/CAM by Product TypeWorldwide

Workstation Shipments

120000-

A

Standafone

Host-Dependent

Psrsonal Computer

100000eoooo-

60000 -

40000 -

20000 -

i h

0 lass^

—• —

^^^

1986

1

1987

i

1988

L

• • dh

1969

1990

Source: Dataquest

June 1986

2A.4-4

1986 Dataquest Incoiporated June

CCIS Markets

2.4.4 Mechanical Product Type

Table 2.4.4-1

Mechanical CAD/CAM—Worldwide

Application by Product Type

(Millions of Dollars/Actual of Units)

1985 1986

1987 1988 1989 1990

CAGR

Total Market

Revenue

Systems

UorlMtations

Standalone

Revenue

Systems

Worlcstations

Host-Dependent

Revenue

Systems

WorIcstatfons

2.677 3,266

29,632 42,232

40,635

Y

53,568

v.^'i.

3,952

59,457

71,909

4,742

5,664

83,537 118,473

6,760

167,133

96,607 130.282 176,265

20.4%

41.3%

34.1%

294

3,524

3,524

689

9,380

9,380

1,280

20,610

20,610

2,172

41,179

41,179

3,441

76,007

4,988

126,642

76.007 126,642

76.2%

104.7%

104.7%

2,161

3,476

14,479

2,178

3,782

15,119

2,096

3,869

16,321

1,945

3,747

16,817

1,603

3,077

14,886

1,191

2,103

11,235

-11.2%

-9.6%

-4.9%

Personal Computer

Revenue

Systems

Workstations

221

22,633

22,633

399

29,070

29,070

577

34,978

34,978

625

38.611

38.611

620

39,390

39.390

580

38,388

38,388

21.3%

11.1%

11.1%

SOURCE: Oataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

2.4.4-5

2.4.4 Mechanical Product Type

Table 2.4.4-2

Mechanical CAD/CAM—Worldwide

Application by Product Type

(Percent of Total)

1985 1986 1987 1988 1989 1990

Standalone

Revenue

Systems

Worlcstatfons

Host'Oependent

Revenue

Systems

Uorlcstations

Personal Computer

Revenue

Systems

Workstations

11X

12%

9%

81X

12X

36X

21X

22X

18X

67X

9X

28X

32X

35X

29X

53X

7X

23X

A6X

49X

43X

41X

4X

17X

61X

64X

58X

28X

3X

11X

74%

76X

72X

18%

IX

6X

8X

76X

56X

12X

69X

54X

15X

59X

49X

13X

46X

40X

11X

33X

30X

9X

23X

22X

SOURCE: Dataquest

June 1986

2-4.4-6 © 1986 Dataquest Incorporated June CCIS Markets

2.4.5 Mechanical Turnkey Average Prices

This section includes Dataquest's forecasts and analysis of the average price per seat by product type for the mechanical turnkey segment. Figure 2.4.5-1 and

Table 2.4.5-1 reflect these data.

• The average price per seat is dropping for all product types. The general trend in increasing functionality in hardware and software is raising the value of the average configuration, but not enough to offset the rapid reduction in prices for hardware components and software.

• Li 1986, the average price per seat is expected to drop 14 percent in standalone products.

• From 1985 to 1990, the standalone product has the largest reduction in average price per seat, estimated at 15 percent.

• The personal computer-based product is expected to change the least, dropping only 6 percent over the five-year period from 1985 to 1990.

CCIS Markets © 1986 Dataquest Incorporated July 2.4.5-1

2.4.5 Mechanical Turnkey Average Prices

Figure 2.4.5-i

Mechanical Turnkey—Worldwide

Average Price per Seat

Thousands of Dollars

140-

120

100

• Standalone

# Host-Dependent

A Personal Connputer

so

40

2 0 , t

1985

1996

19B7

1988 1989 1990

S-oarce: Bataquest

Jane 1986

2.4.5-2

© 1986 Dataquest Incoiporated July

CCIS Markets

2.4.5 Mechanical T u r n k e y Average Prices

T a b l e 2.4.5-1

Mechanical Turnkey—Worldwide

Average Price p e r Seat

(Thousands of Dollars)

All Product Types

Standalone

Host-Dependent

Personal Coniputer

1985 198& 1987 1988 1989 1990 CAGR

68.1

63.6

136.5

19.7

58.4

56.5

118.9

18.5

46.1

47.5

103.2

17.6

39.2

39.9

89.6

16.5

32.8

33.5

77.7

15.4

27.3 -17%

28.1 -15X

67.5 -13X

14.1 •6X

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July 2.4.5-3

2.4.6 Mechanical Revenue Source

^^^ This section includes Dataquest's forecasts and analysis of the mechanical market, segmented by source of revenue for each product type. Figures 2.4.6-1

Revenue and 2.4.6-1 Shipments and Tables 2.4.6-1 and 2.4.6-2 reflect these data.

• Hardware historically has represented the majority of system cost. In fact, the cost was artificially higher than necessary to offset the undervalued software. The current trend toward value pricing and unbundling make comparisons more realistic.

• The distribution of hardware revenue varies by processor type. In 1985, the hardware revenue content has a range of 52 percent for the standalone system to 71 percent for the personal computer. Overall, 64 percent is the average.

The software content is rising in all categories, with the low point as a percentage of revenue occurring in 1985.

• Standalone systems are expected to retain the highest value content in software, increasing to 41 percent in 1990.

Service revenue is relatively constant, with more reliable systems being serviced by higher-cost, more experienced service personnel.

CCIS Markets © 1986 Dataquest Incorporated July 2.4.6-1

2.4.6 Mechanical Revenue Source

Figure 2.4.6-1 Revenue

Mechanical CAD/CAM—Worldwide

Revenue Source by Product Type

2000-

1600-

1200

800

400

Millions of Dollars

3200-

2800

• Hardware

• Software

A Service

2400-

04

1985 1986

1987 issa

1989 1990

Source: Dataquest

June 198«

2.4.6-2

1986 Dataquest Incorporated July

CCIS Markets

2.4.6 Mechanical Revenue Source

Table 2.4.6-1

Mechanical CAD/CAM—Worldwide

Revenue Source by Product Type

(Millions of Dollars)

A l l Product Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Cotnputer

Hardware

Software

Service

Total

1985 1986 1987 1988 1989 1990

CAGR

1,714 2 , 0 5 8

579- ^\.'\''--763

383

2,677

445

3 , 2 6 6

2,387

1,035

530

3,952

2,688

1,396

658

4,742

2,937

1,876

852

5,664

3,138

2,481

1,141

6,760

13%

34%

24%

20%

154

106

34

294

359

250

80

689

654

473

153

1,280

1,075

825

273

2,172

1,615

1,353

473

3,441

2,165

2,043

780

4,988

70%

81%

87%

76%

1,402

414

345

2,161

1,415

405

358

2,178

1,328

402

366

2,096

1,182

390

372

1,945

903

334

366

1,603

591

251

349

1.191

-16%

-10%

0%

-11%

158

59

4

221

283

108

8

399

405

160

12

577

432

181

13

625

419

188

13

620

382

187

12

580

19%

26%

21%

21%

Source:

Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

2.4.6-3

2.4.6 Mechanical Revenue Source

Table 2.4.6-2

Mechanical CAD/CAM—Worldwide

Revenue Source by Product Type

(Percent of Total)

A l l Prodjct Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Computer

Hardware

Software

Service

Total

198S 1986 1987

1988

1989

1990

64X

22X

UX

100X

63%

23X

UX

100X

60X

26X

13X

100X

57X

29X

UX

100X

52X

33X

15X

100X

46X

37X

17X

100X

52X

36%

12X

100X

52X

36X

12%

100X

51X

37X

12X

100X

49X

38X

13X

100X

47X

39%

UX

100X

43X

41X

16X

100X

65%

19X

16X

100X

65X

19X

16X

100X

63X

19X

17X

100X

61X

20X

19X

100X

56X

21X

23X

100X

SOX

21X

29%

100X

71X

27X

2X

100X

71X

27X

n

100X

70X

28X

2X

100X

69%

29%

2%

100X

68X

SOX

2X

100X

66X

32X

2X

100X

Source: Dataquest

June 1986

2.4.6-4

1986 Dataquest Incorporated July

CCIS Markets

2.5 Mechanical—Solid Modeling

Solid Modeling—

More Than a Pretty Face

Source: Robot from "Brilliance,"

Robert Abel & Associates

Looking at realistic images is the first significant benefit derived from solid modeling. The images can represent an automobile, an airplane, or, in this case, a robot model used in a commercial. But, the value of pretty pictures is quickly overshadowed by the full potential of solid modeling in the manufacturing sector.

Solid modeling is used to build computer models of existing parts for analysis and redesign, resulting in improved products. New design concepts can be tested in a fraction of the time that is required using manual metliods. Solid modeling represents the next generation of modeling technology. It has proven to be effective in several application areas, but the full measure of its benefit will evolve over the coming decade.

The future of solid modeling depends on its ability to meet the total product description requirements of the manufacturing industries. The modeling needs vary by industry but the core issues are the same.

Can solid modeling provide a complete part description in a computerized data base that supports all the applications needed to operate the business? This service section answers this question by discussing the vendor and user viewpoints, and it provides insight into the current status of solid modeling. Our detailed forecast and analysis measures the expected progress of this exciting new technology.

DEFINITION

The first serious question to resolve is: What is solid modeling? Everybody believes a scale model carved from wood or plastic is in fact a solid model. The resulting model of the car, boat, building, or structure is a valuable conceptual design and visualization tool. Unfortunately, the physical model provides little

CCIS Markets © 1986 Dataquest Incorporated September 2.5-1

2.5 Mechanical—Solid Modeling support for the detail design, documentation, or manufacturing process. Dataquest believes that solid modeling technology can solve these problems by building a model that is geometrically complete and provides the foundation to support a full array of CAD/CAM applications used throughout the design and manufacturing process. These two issues, completeness and the ability to support C/UD/CAM applications, form the basis for comparison of all solid modelers. Limitations in either will restrict the utility of the system and the markets that can profitably use the system.

The next question of definition concerns the content of the electronic data base.

It is physically impossible to store a solid object on a magnetic disk spinning at

3,600 rpm. What is stored obviously is a digital representation of the object or group of objects. The question then is: What information is required? The answer varies with the needs of the user and the application. For some, just seeing a color-shaded image of the new object provides a significant benefit. For others, a complete part description accurately describing every bump, hole, surface, and feature is required. This complete geometric part description can be combined with other pertinent data to fully describe the manufacturing tolerances, material, processing, and cost parameters of the object. This implies a further ability to extract this data for all design, analysis, simulation, manufacturing, documentation, testing, and verification operations. The key benefit of solid modeling is derived from sharing a single part representation throughout the design and manufacturing process. Solid modeling is the first data base format that conceptually can provide this required level of functionality.

Providing all this in a package that is easy to use, fast, and reliable is the challenge being addressed by dozens of solid modeling developers. Understanding how to use these tools effectively as they evolve is the challenge facing the users.

The competitive pressure to accurately design and build better products in a shorter time frame is driving the user industries toward CAD/CAM technology. Today, solid modeling is widely believed to be the best fundamental tool for the job.

HISTORY

The modeling process in computer graphics is growing through its third phase.

The first phase began in the mid-1960s as a few straight lines on a storage tube display. These lines could represent just about anything from the circuit path on a printed circuit board to the object lines of a drawing. As the two-dimensional elements of lines and curves grew into three-dimensional wire-frame models, the mid-1970s saw the evolution of the second phase of computer-aided modeling. The second phase in the modeling process evolved as the design continued to grow in complexity, representing more and more information about the precise shape, size, and surface contour of the parts required.

2.5-2 © 1986 Dataquest Incorporated September CCIS Markets

2.5 MechanicalSolid Modeling

Solid modeling represents the third step in the evolution of computer-aided modeling. All of the edges, surfaces, and holes of an object are knitted together to form a cohesive whole. The computer can determine the inside of the object from the outside. Perhaps more importantly, it can automatically trace across the object and readily find all intersecting surfaces and edges.

In the mid-1970s, various universities and industrial developers began to develop elements of this new modeling process. The PADL project from the

University of Rochester is typical of some of these early systems. The essence of the approach uses well-defined, three-dimensional objects as building blocks.

Various sizes of blocks and cylinders are added and subtracted from each other to form the desired part. This procedure is known as Constructive Solid Geometry

(CSG). The set of primitive objects now includes cones, wedges, and several other regular-shaped objects. Boolean operators (union, difference, and intersection) and

Other Operators are used to combine the objects. The advantage of this process is the fast description of the shape of the part and the ease of modification.

Unfortunately, modeling the full range of part shapes is difficult if not impossible.

Cast and forged parts with tapered sides and rounded corners are good examples of parts extremely difficult to model with the CSG approach.

Another form of solid modeler has evolved, called the Boundary Representation

(B-Rep). In this process, every vertex, edge, and face is explicitly defined. The connectivity (topology) showing the relationship between each of these elements provides the glue to turn the list of elements into a geometrically solid object. This process is inherently more flexible but requires rigorous algorithms to guarantee the construction of a valid object. However, the easy access to individual surfaces for sampling or display is an advantage of B-Rep solid modelers. Other conceptual approaches have been developed, such as Octree, but have not made significant impact as commercial systems.

The common expectation of today's solid modelers includes a variety of primitive objects with construction operations to form any free-form swept or sculptured shape. Most vendors are meeting this expectation by providing a hybrid or combination of B-Rep and CSG features. Users require Boolean operators to quickly join and shape the object, and easy part modification to support design iteration and revision.

VENDOR PERSPECTIVE

The Check-off Box

A flurry of solid modeling products was introduced a few years ago that allowed the vendors to reply affirmatively to the question: Do you have solid modeling? Heightened media attention suggested the need to ask, even though the prospect probably did not understand why it was important. Today, a "yes"

CCIS Markets © 1986 Dataquest Incorporated September 2.5-3

2.5 Mechanical—Solid Modeling

response to the question is not enough. The expectations of the potential users have progressed, looking for a wide range of capabilities. The vendors have risen to the challenge and are in the process of developing next-generation products that meet the real needs of the user. Table 2.5-1 lists the solid modeling vendors and products that Dataquest currently tracks.

Table 2.5-1

Major Solid Modeling Vendors and Products

Company Name

Applicon

Auto-trol Technology Corp.

Automation Technology Products

British Technology Group

CAD AM Inc.

Cadetron

CADCentre

CAEtec Software Inc.

Cahna Co.

CatTonix Corp.

Cimlink Inc.

Computervision Corp.

Control Data Corp.

CSA

Cubicomp Corp.

Daisy

Dassault Systems USA

Evans & Sutherland Computer Co.

Ferranti Infographics

GE-CAE Intemational/SDRC

Gerber Systems Technology Inc.

GMWC

Gould

Graftek

Harris Corp.

IBM

Interactive Computer Modelling Inc.

Intergraph Corp.

Isykon

Manufacturing & Consulting Services

Matra Data vision Inc.

McDonnell Douglas Mfg. Info. Systems

Norsk Data

Pafec Inc.

PDA Engineering

Perspective Design Ltd.

Phoenix Data Systems

Prime Computer Inc.

Sperry Corp.

Swanson Analysis Systems Inc.

Tektronix Inc.

Unicad

Product Name

Solids Modeling II

Series 7000 Solids Modeling

CIMPLEX

VOLE

Solids Modeler (MAGI)

Cadresolids

PDMS

PRO-SOLID

GEOMOD

CATSOLID

Component Geometry Modeler

MEDUSA (CIS), SOLIDESIGN

ICEM

Solid Modeler

CS-5 PolyCAD 10

Gemsmith

CATIA

ROMULUS

CAM-X ROMULUS

GEOMOD

GST-Solid

RUCAPS

Gemsmith

Solid Modeling System

HarrisCAD

CADAM, CAEDS, CATIA

GMS

Solid Modeler

PROREN

OMNISOLIDS

EUCLID

UNISOLIDS

TECHNOVISION

Boxer

PATRAN II

MicroSolid

Insight

PRIME MEDUSA

CIM/ME SOLID MODELER

ANSYS

PATRA.N II

M/P/E (Romulus)

Source: Dataquest

February 1986

2.5-4

1986 Dataquest Incorporated September

CCIS Markets

2.5 Mechanical—Solid Modeling

Making It Real

Some of the early product successes such as Geomod from SDRC/GE CAE-I,

Euclid from Matra Datavision, and PADL from the University of Rochester proved the practical application of solid modeling. Conceptual design with improved visualization and accurate part properties for weight and mass have been the most successful application areas. Vendors are hard at work expanding the scope of solid modeling from a design tool to the basis for a corporate data base. The systems now in development will be used for everything from early conceptual design to final production and inspection. A serious effort to understand the scope of this task elicits respect for the system designers and programmers that are trying to make it happen.

The current stage in the evolution of systems used for conceptual design is mechanical computer-aided engineering (MCAE). The MCAE products combine enhanced modeling with improved analysis functions. On-line engineering reference documents and a user interface for the engineer are also getting development attention.

Niche Integration Versus Data Base Integration

Today, each of the top 10 mechanical CAD/CAM vendors has a solid modeling product. Dozens of others have, or are in the process of developing, their own products. The approach is different from vendor to vendor, but they fall into two general groups. The niche vendor approach capitalizes on an opportunity to focus on a vertical market and provide a high level of integration in a specific application area. The hope is to attract the user with special requirements, leading to higher-performance packages that are easier to use.

The system integrator approach is as broad as possible. By providing a complete package or a solid foundation for the total corporate graphics needs of a company, the vendor hopes to become the standard graphics tool supplier for the entire operation. As standards for communication improve, the opportunity for the system integt^tors and the niche suppliers to work together will improve as well.

The combined synergy and competitive pressure in this environment will push product development to high levels in all application areas.

Dataquest believes that the niche developers will lead in developing innovative solutions in each of their application areas, but that the system integrators will be close behind taking advantage of any significant development. The major development areas have been identified as finite element modeling, analysis and optimization, numerically controlled part programming, drafting/documentation, and design verification. As market leaders emerge, strategic alliances will be formed to move the niche solutions toward integration as complete systems. This process would be aided considerably if standards were in place to define the format of data to share between unlike systems.

CCIS Markets © 1986 Dataquest Incorporated September 2.5-5

2.5 Mechanical—Solid Modeling

TECHNOLOGIES

Millions of dollars are being spent to improve performance, functionality, and user-interface operations. The following sections discuss the key technology development areas and identify their major features and current trends.

Modeling

The primary function of solid modeling is to give the user the ability to model completely any realizable object. Modeling development is being directed toward solving the deficiencies that limit the classes of parts that can be modeled.

Castings, forgings, and sculptured pieces such as automotive body parts are the most common problem, areas. Making the part model more complete by more accurately capturing all relevant information in an easily maintained form is the key issue.

A current trend in making the systems easier to use is based on a modeling process that uses more complex primitive shapes called feature-based modeling.

Rather than using blocks, cones, or cylinders to form the part, standard part features are used as part construction operations. Asking for a drilled, countersunk, and tapped hole in a single operation is an example of this process. A^n extension of this process generates complete standard parts. By filling in questions to a parametric program, standard gears, pulleys, or brackets can be modeled. Any of these procedures can be custom tailored for the user company to reflect established company practices or manufacturing constraints. The rapid construction of standard part features or standard parts can improve the productivity of the system.

Feature-based modeling is a useful tool in moving solid modeling from a conceptual design to the mainstream of production design and manufacturing.

Adding tolerance data to the data structure is currently under study.

Longer-term developments center on modeling manufacturing processes and functional test environments. Accurately modeling processes such as painting, plating, or heat treatment may or may not be necessary; however, the information describing the operation must be captured and maintained with the part data base.

The complete part data base will support top-down part planning and bottom-up operation planning.

Display

Fast image generation has been an Achilles heel for solid modeling. Rapid rotation and translation of view and part orientation is essential for interactive design tasks. Application-specific VLSI and display packaging designed for this market are just becoming available to speed up this process.

Fortunately, one of the most successful development areas associated with solid modeling has been display. Image generation has progressed from hours and days worth of computing time to fractions of a minute. Images include wire-frame, hidden-line, and shaded images in isometric, perspective, single, or multiple views.

2.5-6 © 1986 Dataquest Incorporated September CCIS Markets

2.5 Mechanical—Solid Modeling

Application-specific ICs and displays designed for this task are solving the problem.

Display performance is improving by a factor of approximately two each year. In other words, a 10,000-polygon shaded image could be rotated and redisplayed in one second a year ago. Now, 20,000 polygons can be processed in the same time, or 10,000 in half the time. Products released in 1986 are expected to handle

40,000 polygons in a second or. less.

Realism in display is available with shadows, multiple colored light sources, and textures. Longer term, both image quality and speed of generation will improve, approaching movie film for imaging dynamics and quality. Raster

Technologies, Phoenix Data Systems, General Electric, and Silicon Graphics are leaders in the technology development of solid modeling display.

User Interfaces

Enhanced user interface options include pop-up menus, icons, command strings, and programmable options for repeatable operations. The issue here is not so much, How is the interface presented?, as, Is it easy to use, self-teaching, predictable, reliable, and flexible enough to allow the construction of the necessary detail to accurately define the object for the foUow-on operations? Combining the functional need with the diversity of potential users and with the possibility of building in some rule-based logic to speed up the process will keep the system designers busy for years. User interfaces that are programmable and custom tailored for the user are rapidly becoming the common expectation.

Data Base

The full potential of solid modeling will not be realized until all applications can work from the same data base. The data base will include many different types of information, but there will be one representation for the part description with other data related to it. This process will accurately capture the engineering data base, defining the legal part description and archival record. Where-used and made-from questions can be answered directly. The volume of information associated with this data base is directly related to the level of design and manufacturing automation installed at that time.

Application Interfaces

For solid modeling to become fully accepted, it must support all the major application areas. The primary issue involves taking advantage of the more complete data base. Solid modeling cannot be treated as an add-on application. It must be built in to the core system where the application code can depend on the information being available for use. Virtually any application can be improved and, in some cases, fully automated if the solid modeling techniques are available.

CCIS Markets © 1986 Dataquest Incorporated September 2.5-7

2.5 Mechanical—Solid Modeling

CURRENT UNrVERSITY RESEARCH AND DEVELOPMENT ACnVITY IN

SOLID MODELING

Universities around the world have been working on solid modeling-related issues for the last fifteen years. Several commercial products have evolved from university development, with ongoing development in progress at dozens of sites.

Table 2.5-2 lists the names of universities performing solid modeling research and development activities.

Table 2.5-2

University Research and Development Activity in Solid Modeling

University

Camegie-Mellon

Computer & Automation

Inst. Budapest

Modbuild

Project Name*

GUde, BDS

Built-t-

Robotics

Mosy

Modeling

Modeling

Double quadratic surfaces

Cornell University

Cranfleld Inst, of Tech.

Czech Tech. Univ. Prague

Federal Inst, of Tech. Zurich

Helsinki Univ. Tecluiology

Hokksiido Univ., Japan

IBM U.K. Scientific Centre

Kemforschungszentrum Karlsruhe

Royal Inst, of Tech., Sweden

Leeds University

Loughborough Univ. of Tech.

Newcastle Polytechnic

Norwegian Inst, of

Tech./Sinteff

TIPS

Test Bed

Modeler

JOE/GSFEL

Euklld

GWB

TIP/GSP

Winsom

Gipsy

GPM

Noname (Boxer)

SWANS (Leeds)

-

Assembled

Plate

Genus

Motion synthesizer with movie interface

Auto generation and verification of NC

AI, process planning

CAM-I AIS, form features

Modeling

Modeling

Modeling, kinematics, and FEM generation

Geometric simulator

Organic molecule modeling

Application interfaces

Modeling

Auto NC and FEM generation

CAM applications

Form-feature data base

Assembler welding

Politecnico di Milano

Polytechnic of Central London

Purdue University

RPI

Royal Inst, of Tech. Stockholm

Ruhr Univ.-Boehm

Tech. Research Centre Finland

Tech. Univ. Berlin

Cadme

-

-

Octree

GPM

Proren-2

Uniblock

ASP-GM

Compac

Baustein

Geometric

Modeling, kinematics,

NC turning

CAD/CAM national project

Modeling, tolerancing, NC

Modeling,

Modeling, ray tracing

Modeling, sheet metal, robotics, welding, AI

Modeling

Modeling, AI, FEM generation, kinematics

Modeling

Modeling, interfaces, AI

(Continued)

2.5-8 1986 Dataquest Incorporated September

CCIS Markets

2.5 Mechanical—Solid Modeling

Table 2.5-2 (Continued)

University Research and Development Activity in Solid Modeling

University

Tech. Univ. Delft

Tech. Univ. Denmark

Univ. of Bath

Univ. of Cambridge

Univ. of East Aaglia

Univ. of Ediatmr^

Univ. of Karlsruhe

Univ. of Michigan

Univ. of Rochester

Univ. of Tokyo

Project Name*

Raymo

SEDA

Technovision

(Compac)

Vole, Dora

-

Build II

Robmod

Dicad

Proren

Architectural

System

ASV

PADL II

Ceomap

Modeling

Ray tracing

Modeling

Modeling

Raycasting, NC,

modeling

GKS graphics, autofeature

recognition, auto NC, robotics

Solids/sculptured surfaces

Robotics

Modeling, AI

Architectural modeling

Feature extraction

Object modeling

Process modeling

and planning

Free-form shapes, NC

'Project or product names shown in parentheses indicate affiliations between universities and

commerical products.

Source: Dataquest

February 1986

END USERS

The users of solid modeling technology come from virtually all industrial sectors. Table 2.5-3 indicates the major industrial sectors and the corresponding primary area of use.

Table 2.5-3

Primary Solid Modeling Applications By Industry

Industry

Aerospace

Automotive

Architectural

Mechanical/Fabrication

Electro/Mechanical

Mapping

Application

Conceptual design—visualization

Design verification—packaging—visualization

Visualization

Packaging—early design—analysis

Packaging

Subterranean modeling

Source: Dataquest

February 1986

CCIS Markets

© 1986 Dataquest Incorporated September

2.5-9

2.5 Mechanical—Solid Modeling

Earlier in 1985, Dataquest conducted a user survey of more than 600 user sites.

This survey was designed to define the current status of the use of solid modeling and the future expectation of use by industry. Based on the total response,

24 percent of the site managers said they were using solid modeling on their systems. This does not mean that 24 percent of all system hours are spent on solid modeling, but it does mean that 24 percent of the users have access to solid modeling if they need it. / ^ additional 39 percent said they plan to use solid modeling in the future, 21 percent have no plans, and 16 percent do not know. This sets the ratio of believers to nonbelievers in the current CAD/CAM user base at

2 to 1. The challenge will be to make the systems good enough to attract the nonbelievers of the current user base and to become the preferred choice of new

CAD/CAM purchasers.

As Figure 2.5-1 indicates, aerospace has the highest level of installations by site, 39 percent. The high degree of complex new design work and a need for quality make the solid modeling systems attractive in the aerospace industry.

Architects have the highest ratio of current users who plan to use solid modeling. This 4.6 to 1 ratio shows a very large sales potential in the short term.

Historically, however, architects have looked for functionality in a low-cost package, which may slow solid modeling penetration into this market.

Figure 2.5-1

ANALYSIS OF USER SURVEY

S O L I D

MODELING USE BY INDUSTRIES

PERCENT

LEGEND

^

^ ^ NO P L ^ N S

Y////i DON'T KNOW

HAVE PLANS

USING NOW

TOTAL AUTO MECH/FAB MAPRNG

AERO ARCH ELEC/MECH

Source: Dataquest

February 1986

2.5-10 1986 Dataquest Incorporated September

CCIS Markets

2.5 Mechanical—Solid Modeling

Mappers have the smallest level of interest in solid modeling by current users and those with plans to use it. It is worth noting that this group provides a good example of a vertical niche market. The portion of mapping that works with three-dimensional data obtained for subterranean modeling, mining, or oil exploration could benefit from solid modeling.

PENETRATION

Determining market penetration requires market sizing and setting the level of installed product. As always, definitions are necessary to put the data in proper context. Long term, Dataquest expects the potential solid modeling market to include 100 percent of mechanical and 80 percent of AEG markets. For this potential to be realized, solid modeling wjll be required to support all CAD/CAM applications as well as or better than they are supported today by wire-frame and surfacing technology.

Since today's systems use solid modeling as an add-on application or as a core system function, it is difficult to determine the level of use at the workstation level.

Tlie 1985 Dataquest User Survey was used to set the current level of usage on a per-site basis. Roughly 25 percent of the CAD/CAM user sites responding to the

1985 Dataquest User Survey were using solid modeling. This corresponds to more than 17,400 workstations installed worldwide with full or part-time access to solid modeling in 1984. Dataquest believes that market penetration by site will increase from approximately 25 percent in 1984, to 53 percent in 1989. An estimated

79 percent unit growth rate in 1985, forecast to increase to 101 percent in 1989, is responsible for the expected doubling of market penetration on a per site basis.

Penetration considering terminal hours used with direct access to a solid model data base is growing at a faster rate. The rapid transition of solid modeling as a core system function is the primary reason for this accelerated growth rate.

USER ISSUES

To live up to its full potential, solid modeling must pass an impressive set of hurdles. Functionality, ease of use, and price are some of the most significant barriers. The following segments discuss these issues from a user perspective, indicating the needs and level of expectation.

CCIS Markets © 1986 Dataquest Incorporated September 2.5-11

2.5 Mechanical—Solid Modeling

Functionality

The basic solid modeling procedure uses a variety of standard objects as primitives, adding or subtracting them from each other to form the desired part.

The current flexibility of this process will allow the precise modeling of fully machined parts. Increasing the complexity of parts by including castings, forgings, molded, and formed parts, however, adds a level of difficulty that few solid modelers can address. Adding the constraint of building these complex models in a reasonable time frame is another major hurdle.

After building the model, the immediate question arises, "What can be done with it?" The first useful application is to look at it. The visualization process has virtually been solved from a functional view. The engineer can be his own artist and easily produce full color rendered images. Technical illustrations can be displayed that include line drawings in perspective, with hidden lines removed. Accurate, detailed sectioned views can be generated for use in design studies or for detail drawings. Still ahead are improved algorithms and special-purpose hardware that will produce images faster, with more realism and more user control, but at a lower cost.

Building two or more parts that fit together adds another dimension of complexity. Evaluating the nominal fit, mass properties, interferences, and relative motion in mechanism are all significant elements of required functionality. Each of these functions is currently available in various forms of utility and ease of use.

Building large assemblies with more than a thousand components is difficult if not impossible. Complex products or structures can easily have tens of thousands of parts. Configuration management of these large structures must be available. New techniques to allow the interactive use of these large data bases is essential.

The classic major application areas of CAD/CAM must be supported by solid modeling. These are finite element analysis, numerical control part programming, and documentation. Each area can take advantage of the more complete part model and produce precise results in a more automated, easier-to-use scenario. Rule-based procedures will complement the operation, giving the user more time to think about his problem and less time to worry about the steps he needs to follow to make it happen.

Dimensional tolerancing associated with solid modeling is a long-term functionality with exciting potential. Today, edges, holes, and profiles are stored in computers with one value for each component or feature. Allowing a multiple value or a range of values for each of these dimensions opens the door for more complete design evaluation, for manufacturing process optimization, and automated testing for quality assurance.

2.5-12 © 1986 Dataquest Incorporated September CCIS Markets

2.5 Mechanical—Solid Modeling

Solid modeling will provide an efficient base for geometric part data in corporate data bases. Access, format, control, and definition are a few of the major issues involved in using such a data base. By definition, a corporate data base must be accessible to anyone with a legitimate need for business information. Controlling the level of access to each of the functional groups or individuals is a nontrivial task, but it is essential in order to support the full level of communication requirements in industrial automation. Today's CAD/CAM products address the issues of local data bases and local area networks. The tools are just beginning to be available to put together large corporate data bases.

Standards are an essential ingredient in this scheme. Creating a format to capture the essence of product design and manufacturing information is the formidable task of several standards organizations. ISO/TC184-SC4, CAM-I/AIS,

ANSI/Y14.26, DESr/TAP/VDA, AFNOR-SET, and EEC-ESPRTT are leaders in this worldwide effort. An in-deptii look into this Eirea will be the topic of a future research newsletter.

Users are asking for complete application integration as one of the most important components of a solids-based system. Unfortunately, asking ten users for a functional definition of a well-integrated system gets at least ten answers. From

Dataquest's current point of view, the most important solid modeling applications are:

• Finite element mesh generation and analysis

• Numerical control part programming

• Drafting and documentation

• Dimension tolerancing and analysis

• Design verification by interference detection

• Visualization

• Mass properties

As the quality and quantity of part geometry and associated information improves, thus defining a fully operational data base, the emphasis will focus on the flow of information and wliere it is used. Information integration is the primary goal tying organizations into a single business unit.

CCIS Markets © 1986 Dataquest Incorporated September 2.5-13

2.5 Mechanical—Solid Modeling

Performance

The essential element of performance is to retain the interactive nature of the

system, independent of the complexity involved. Every system operation, user interface, functionality, or output process has a performance element. Consider two

highly functional systems, one interactive and responsive, the other batch-oriented

and ponderous. The first is a powerful design tool; the second is a laboratory curiosity. Blinding speed has been the dream of solid modeling practitioners since

the first Boolean operation. The current rapid progress in computing horsepower

and display processing are having a positive effect. But the general problem is far from being solved.

A close look at a realistic design problem illustrates the true need. Routing a

hose through the engine compartment of an automobile and designing the necessary clamps and fittings can take weeks, working from engineering drawings.

Considering the effect of a simple modification to one of the parts or the diversity of engine options increases the complexity by an order of magnitude. Using a solid

representation of the assembly with interactive performance would shorten the job

to a few hours. Simulating the design process allowing fly-around display

performance with models having thousands of parts is a real expectation of

automotive, aerospace, and heavy industrial designers around the world.

In the example cited above, moving to a new location to see a fresh vantage

point can require minutes or even hours with today's systems. The user needs less

than one-second image redisplay time.

Subtracting one shape from another is a powerful modeling operation. Waiting

more than a few seconds to see the result is frustrating and counterproductive.

Productivity

Productivity can be measured in many ways. Completing a measured task in

half the time or less is understood to be productivity improvement. Completing a

task that has never been done or never been possible to do, is difficult to quantify for productivity improvement. If the task is important, productivity is infinitely improved. Solid modeling opens the door for both types of productivity improvement.

The major ease-of-use issue relates directly to productivity. What percentage of

the user's time is spent thinking about how to make the system do what he wants versus the time spent working directly on the problem? Dataquest believes that this

ratio needs to be greater than 90 percent.

Assisting design or manufacturing applications is a primary function of solid

modeling. What is the level of application integration? How much time is required to set up each operation? If the task requires a drawing to be generated, what convolutions are required to get the correct views on the paper? What happens to

2.5-14 © 1986 Dataquest Incorporated September CCIS Markets

2.5 Mechanical—Solid Modeling the drawing when the design is updated? Who is notified when engineering makes a change? A system approach to the above will profoundly improve the communication and productivity of the user's organization.

Ease of Use

Casual users who spend less than two hours per day on a system are the target for the designers of user interfaces. These users need to have a little handholding on each excursion into the land of computer-aided design and manufacturing. They do not want to be slowed down by menu structures or lengthy procedures of small,

"easily understood" command steps in the name of ease of use. On the other hand, they do need assistance in knowing what to do next. This is fertile ground for real innovation in system design.

A key element of ease of use is providing a self-teach mode of operation.

Ideally, the system could monitor the progress of the user and make suggestions for independent study or present tutorial sessions for the learning of new or revised functions.

Price

The performance and display requirements for most solid modeling applications force the use of high-end hardware packaging. Typically, the cost per terminal hour is between $20 and $30. Each potential user will need to evaluate the current level of functionality for proper application to his problem. For some users, the potential benefit could be a bargain at $100 per hour. For the rest, a wait of a year or two will make the difference.

Trends

Exaggerated vendor claims with high-level media coverage have produced overly optimistic expectations. This will continue due to the extremely competitive nature of this business and due to misunderstandings in dealing with the complex issues.

Conceptual design using solid modeling technology has proven to be effective.

Most short-term enhancements will evolve from this foundation.

The availability of the low-cost, high-performance drafting solution is good and bad for solid modeling developers. The good news is that an expensive system does not need to be tied up doing drafting. Developing a complete interface between the solid modeling design system and the high-performance, low-cost drafting system will solve the drafting application need. The bad news is that the user now has the choice: Does he buy three or four drafting systems, or does he buy one solidsbased design system? Dataquest estimates that more than half of the total available mechanical CAD/CAM system hours are used for drafting. The current

CCIS Markets © 1986 Dataquest Incorporated September 2.5-15

2.5 Mechanical—Solid Modeling

users of three-dimensional design systems can off-load their drafting tasks to the new low-cost systems and free up already purchased design stations. Considering the availability of terminal hours, trained users, and established procedures, this could slow short-term demand for design systems.

MARKET FORECASTS

Dataquest's worldwide solid modeling market forecast is shown in Table 2.5-4.

The revenue total represents software-only revenue for solid modeling packages and application software that depends on the solid modeling process. This represents a larger market than the modeling-only market, but more accurately presents the true impact of this technology on the C/UD/CAM industry. Revenue from both bundled and unbundled suppliers are included in the 1985 analysis, and both sources are considered in the forecast. The actual units specified represent the number of systems eind workstations required to operate the software. The expected drop in average system selling prices and the transition of solid modeling from an add-on application to a core system function have been considered in this forecast.

Table 2.5-4

Forecast Solid Modeling Market by Product Type

Software Only Revenue

(Millions of Dollars and Actual Units)

Worldwide

Revenue

Systems

Worlcstations

Standalone

Revenue

Worlcstations

Host-Dependent

Revenue

Systems

Worlcstations

Personal Cocrputer

Revenue

Worlcstations

1985

saa«

$97

1,331

3,572

1986

m n s

$134

2,981

5,616

1987

• s s s

1988

• • « X

1989

ssss

1990

3sas

$193

6,290

9,650

$299

13,243

17,366

$455

26,420

30,733

$675

47,313

51,216

»13

474

$84

839

3,080

$98

1,197

3,832

$109

1,355

4,715

$.1

18

$36

1,600

$80

4,141

$169

10,008

$323

21,537

$554

41,219

$.8

183

$3.5

794

$122

1,494

5,618

$118

1,419

5,731

$7.7

1,740

$15.1

3,465

$100

1,165

5,068

$21.2

4,928

CAGR

ssss

47.5%

104.2%

70.3%

112.7%

144.2%

3.7%

6.8%

10.5%

173.1%

208.5%

S o u r c e : Dataquest

July 1986

2.5-16 1986 Dataquest Incorporated September

CCIS .Markets

2.5 Mechanical—Solid Modeling

The solid modeling market forecast by region is shown in Table 2.5-5.

Table 2.5-5

Solid Modeling Market Forecast by Region

(Millions o f Dollars a n d Actual

U n i t s )

1985

1986 1987

1988 1989 1990

CAGR

Worldwide

Revenue

Systons

Uorkstations

North Ainerica

Revenue

Systems

Workstations

Europe

Revenue

Systems

Workstations

Far East

Revenue

Systems

Workstations

Rest of World

Revenue

Systems

Workstations

$97

1,331

3,572

$54

692

1,618

$75

1,547

2,538

$107

3,242

4,328

$29

409

1,144

$134

2,981

5,616

$41

927

1.820

$193

6,290

9,650

$299

13,243

17,366

$455

26,420

30,733

$675

47,313

51.216

$60

2,000

3,196

$165

6,786

7,736

$251

13,459

13,599

$370

23.961

22.508

$94

4,277

5,838

$145

8,612

10,423

$216

15.517

17,473

$12

209

746

$2

22

64

$16

461

1,161

$2

46

96

$23

954

1,967

$35

1,982

3,505

$3

94

160

$4

197

287

$53

3,955

6,203

$79

7.106-

10,362

$7

394

508

$10

729

872

47.5X

104.2%

70.3%

46.8%

103.2%

69.3%

49.6%

107.0%

72.5%

46.0%

102.5%

69.3%

45.7%

101.7%

68.4%

Source: Dataquest

July 1986

MARKET SHARE ANALYSIS

The three groups of companies profiled in Table 2.5-6 indicate market share analysis by vendor and number of installed workstations with access to the named product. The level of utilization of the solid modeling product or module is expected to range from often to full-time. Group A represents vendors with established solid modeling products in production in many user organizations.

Group B includes emerging products by well-known vendors or second sources for third-party software products. Group C includes the newest entries with just announced products or products in beta test. Some of the latest technology can be found in these products.

CCIS Markets 1986 Dataquest Incorporated September

2.5-17

2 . 5 M e c h a n i c a l — S o l i d M o d e l i n g

2 . 5 - 1 8

T a b l e 2 . 5 - 6

S O L I D M O D E L I N G M A R K E T S H A R E A N A L Y S I S

C o m p a n y P r o d u c t

G r o u p A

Applicon

CADCentre

Computervision Corp.

Control Data Corp.

SDRC

IBM

MAGI

Matra Data vision Inc.

McDonnell Douglas Mfg. Info. Systems

Prime Computer

G r o u p B

Auto-trol Technology Corp.

Calma Co.

Evans St. Sutherland Computer Co.

Ferranti Infographics

GMWC

IBM

Manufacturing Si Consulting Services

Group C

Automation Technology Products

British Technology Group

Cimlink Inc.

CAEtec Software Inc.

CAD AM Inc.

Catronix Corp.

Cadetron

Cubicomp Corp.

CSA

Daisy

Geiber Systems Technology Inc.

Graftek

Gould

Harris Corp.

Hewlett-Packard

IBM

Interactive Computer Modeling Inc.

Intergraph Corp.

Isykon

Norsk Data

Pafec Inc.

PDA Engineering

Perspective Design Ltd.

Phoenix Data Systems

Sperry Corp.

Swanson Analysis Systems Inc.

Tektronix Inc.

Solids Modeling II

PDMS

MEDUSA (CIS), SOLIDESIGN

ICEM

GEOMOD

CATIA

Synthavision

EUCLID

UNISOLIDS

PRIME MEDUSA

Series 7000 Solids Modeling

GEOMOD

ROMULUS

CAM-X ROMULUS

RUCAPS

CAEDS

OMNISOLIDS

CIMPLEX

VOLE

Component Geometry Modeller

PRO-SOLID

Solids Modeler (MAGI)

CATSOLID

Cadresolids

CS-5 PolyCAD 10

Solid Modeler

Gemsmitb

GST-Solid

Solid Modeling System

Cemsmith

HanisCAD

SMD-SoUd Modeling Design

CADAM

GMS

Solid Modeler

PROREN

TECHNOVISION

Boxer

PATRAN II

MicroSolid

Insight

CIM/ME Solid Modeler

ANSYS

PATRAN II

Notes: Group A contains companies with products installed on more than 500 workstations.

Group B contains companies with products installed on more than 100 workstations.

Group C contains companies with products in development, in beta test, or recently released with up to 100 workstations installed.

Source: Dataquest

July 19S6

1 9 8 6 D a t a q u e s t I n c o r p o r a t e d S e p t e m b e r

C C I S M a r k e t s

2.5 Mechanical—Solid Modeling

DATAQUEST ANALYSIS

The Promise

The promise of real-world simulation in a computer system conjures visions of electronic sculpting and forming with the ease of hands on clay. The designer's eye gazes upon the full color shaded images and sees a new product evolve from an idea to a tested concept in an afternoon. The promise of products optimized for performance and quality will result in improved profitability for the company. The full realization of this promise will revolutionize the industrial sector.

The Wait

Remarkable progress has been made in turning promise into reality. Niche markets have demonstrated many of the concepts, proving their feasibility.

Conceptual design has been the most successful niche market, proving the effective combination of solid modeling and analysis. Close integration with other design and manufacturing applications are in development. The future of solid modeling is directly dependent upon the successful implementation of the fully integrated system; the add-on approach will not serve the real needs of the user. The application packages must be able to depend on the availability of solid modeling information to reach the next plateau of system performance and functionality.

The Winners

The person, group, department, division, and/or company that understands the effective use of solids-based CAD/CAM wiil have a basic competitive advantage over the nonusers. Products that are produced from CAD/CAM systems based on solid modeling and on the application packages that take full advantage of the technology will be more competitive, more reliable, less costly, and more profitable. Solid modeling is making the mechanical CAD/CAM business exciting again.

CCIS Markets © 1986 Dataquest Incorporated September 2.5-19

2.5 MECHANICAL-SOLID MODELING

^^^^^B^^^Sps^^J^H

^ • K ''A.-.. m

Solid Modeling—

More Than a Pretty Face

Source: Robot from "Brilliance,"

Robert Abel & Associates

Looking at realistic images is the first significant benefit derived from solid modeling. The images can represent an automobile, an airplane, or, in this case, a robot model used in a commercial. But, the value of pretty pictures is quickly overshadowed by the full potential of solid modeling in the manufacturing sector.

Solid modeling is used to build computer models of existing parts for analysis and redesign, resulting in improved products. New design concepts can be tested in a fraction of the time that is required using manual methods. Solid modeling represents the next generation of modeling technology. It has proven to be effective in several application areas, but the full measure of its benefit will evolve over the coming decade.

The future of solid modeling depends on its ability to meet the total product description requirements of the manufacturing industries. The modeling needs vary by industry but the core issues are the same.

Can solid modeling provide a complete part description in a computerized data base that supports all the applications needed to operate the business? This service section answers this question by discussing the vendor and user viewpoints, and it provides insight into the current status of solid modeling. Our detailed forecast and analysis measures the expected progress of this exciting new technology.

DEFINITION

The first serious question to resolve is: What is solid modeling? Everybody believes a scale model carved from wood or plastic is in fact a solid model. The resulting model of the car, boat, building, or structure is a valuable conceptual design and visualization tool. Unfortunately, the physical model provides little

CCIS © 1986 Dataquest Incorporated Feb. 21 2.5-1

2.5 MECHANICAL-SOLID MODELING support for the detail design, documentation, or manufacturing process.

DATAQUEST believes that solid modeling technology can solve these problems by building a model that is geometrically complete and provides the foundation to support a full array of CAD/CAM applications used throughout the design and manufacturing process. These two issues, completeness and the ability to support

CAD/CAM applications, form the basis for comparison of all solid modelers.

Limitations in either will restrict the utility of the system and the markets that can profitably use the system.

The next question of definition concerns the content of the electronic data base.

It is physically impossible to store a solid object on a magnetic disk spinning at

3,600 rpm. What is stored obviously is a digital representation of the object or group of objects. The question then is: What information is required? The answer varies with the needs of the user and the application. For some, just seeing a color-shaded image of the new object provides a significant benefit. For others, a complete part description accurately describing every bump, hole, surface, and feature is required. This complete geometric part description can be combined with

Other pertinent data to fully describe the manufacturing tolerances, material, processing, and cost parameters of the object. This implies a further ability to extract this data for all design, analysis, simulation, manufacturing, documentation, testing, and verification operations. The key benefit of solid modeling is derived from sharing a single part representation throughout the design and manufacturing process. Solid modeling is the first data base format that conceptually can provide this required level of functionality.

Providing all this in a package that is easy to use, fast, and reliable is the challenge being addressed by dozens of solid modeling developers. Understanding how to use these tools effectively as they evolve is the challenge facing the users.

The competitive pressure to accurately design and build better products in a shorter time frame is driving the user industries toward CAD/CAM technology. Today, solid modeling is widely believed to be the best fundamental tool for the job.

HISTORY

The modeling process in computer graphics is growing through its third phase.

The first phase began in the mid-1960s as a few straight lines on a storage tube display. These lines could represent just about anything from the circuit path on a printed circuit board to the object lines of a drawing. As the two-dimensional elements of lines and curves grew into three-dimensional wire-frame models, the mid-1970s saw the evolution of the second phase of computer-aided modeling. The second phase in the modeling process evolved as the design continued to grow in complexity, representing more and more information about the precise shape, size, and surface contour of the parts required.

2.5-2 © 1986 Dataquest Incorporated Feb. 21 CCIS

2.5 M E C H A N I C A L - S O L I D M O D E L I N G

Solid modeling represents the third step in the evolution of computer-aided modeling. All of the edges, surfaces, and holes of an object are knitted together to form a cohesive whole. The computer can determine the inside of the object from the outside. Perhaps more importantly, it can automatically trace across the object and readily find all intersecting surfaces and edges.

In the mid-1970s, various universities and industrial developers began to develop elements of this new modeling process. The PADL project from the

University of Rochester is typical of some of these early systems. The essence of the approach uses well-defined, three-dimensional objects as building blocks.

Various sizes of blocks and cylinders are added and subtracted from each other to form the desired part. This procedure is known as Constructive Solid Geometry

(CSG). The set of primitive objects now includes cones, wedges, and several other regular-shaped objects. Boolean operators (union, difference, and intersection) and

Other operators are used to combine the objects. The advantage of this process is the fast description of the shape of the part and the ease of modification.

Unfortunately, modeling the full range of part shapes is difficult if not impossible.

Cast and forged parts with tapered sides and rounded corners are good examples of parts extremely difficult to model with the CSG approach.

Another form of solid modeler has evolved, called the Boundary Representation

(B-Rep). In this process, every vertex, edge, and face is explicitly defined. The connectivity (topology) showing the relationship between each of these elements provides the glue to turn the list of elements into a geometrically solid object. This process is inherently more flexible but requires rigorous algorithms to guarantee the construction of a valid object. However, the easy access to individual surfaces for sampling or display is an advantage of B-Rep solid modelers. Other conceptual approaches have been developed, such as Octree, but have not made significant impact as commercial systems.

The common expectation of today's solid modelers includes a variety of primitive objects with construction operations to form any free-form swept or sculptured shape. Most vendors are meeting this expectation by providing a hybrid or' combination of B-Rep and CSG features. Users require Boolean operators to quickly join and shape the object, and easy part modification to support design iteration and revision.

VENDOR PERSPECTIVE

The Check-Off Box

A flurry of solid modeling products was introduced a few years ago that allowed the vendors to reply affirmatively to the question: Do you have solid modeling? Heightened media attention suggested the need to ask, even though the prospect probably did not understand why it was important. Today, a "yes"

CCIS © 1986 Dataquest Incorporated Feb. 21 2.5-3

2.5 MECHANTCAL-SOLID MODELING response to the question is not enough. The expectations of the potential users have progressed, looking for a wide range of capabilities. The vendors have risen to the challenge and are in the process of developing next-generation products that meet the real needs of the user. Table 2.5-1 lists the solid modeling vendors and products that DATAQUEST currently tracks.

Company Name

y

Applicon

Auto-trol Technology Corp.

Automation Technology Products

British Technology Group

CAD AM Inc.

Cadetron

CADCentre

CAEtec Software Inc.

Calma Co.

Catronix Corp.

Cimlink Inc.

,.,-— Computervision Corp.

Control Data Corp.

CSA

Cubicomp Corp.

Daisy

Dassault Systems USA

Evans & Sutherland Computer Co.

~, Ferranti Infographics

^ GE-CAE InternaUona*/SDRC

L Gerber Systems Technology Inc.

G M W C

Gould

Graftek

Harris Corp.

IBM

Interactive Computer Modelling Inc.

^—- Intergraph Corp.

Isykon

Manufacturing & Consulting Services

Matra Datavision Inc.

— McDonnell Douglas Mfg. Info. Systems

Norsk Data

Pafec Inc.

PDA Engineering

Perspective Design Ltd.

Phoenix Data Systems

- Prime Computer Inc.

Sperry Corp.

Swanson Analysis Systems Inc.

Tektronix Inc.

Unicad

Table 2.5-1

Major Solid Modeling Vendors and Products

Product Name

Solids Modeling II

Series 7000 Solids Modeling

CIMPLEX

VOLE

Solids Modeler (MAGI)

Cadresolids

PDMS

PRO-SOLID

GEOMOD

CATSOLID

Component Geometry Modeler

MEDUSA (CIS), SOLIDESIGN

ICEM

Solid Modeler

CS-5 Poly CAD 10

Gemsmith

CATIA

ROMULUS

CAM-X ROMULUS

GEOMOD

GST-Solid

RUCAPS

Gemsmith

Solid Modeling System

HarrisCAD

CAD AM, CAEDS, CATIA

GMS

Solid Modeler

PROREN

OMNISOLIDS

EUCLID

UNISOLIDS

TECHNOVISION

Boxer

PATRAN II

MicroSoIid

Insight

PRIME MEDUSA

CIM/ME SOLID MODELER

ANSYS

PATRAN II

M/P/E (Romulus)

Source: DATAQUEST

February 1986

2.5-4 1986 Dataquest Incorporated Feb. 21

CCIS

2.5 MECHANICAL-SOLTD MODELING

Making It Real

Some of the early product successes such as Geomod from SDRC/GE CAE-I,

Euclid from Matra Datavision, and P/UDL from the University of Rochester proved the practical application of solid modeling. Conceptual design with improved visualization and accurate part properties for weight and mass have been the most successful application areas. Vendors are hard at work expanding the scope of solid modeling from a design tool to the basis for a corporate data base. The systems now in development will be used for everything from early conceptual design to final production and inspection. A serious effort to understand the scope of this task elicits respect for the system designers and programmers that are trying to make it happen.

The current stage in the evolution of systems used for conceptual design is mechanical computer-aided engineering (MCAE). The MCAE products combine enhanced modeling with improved analysis functions. On-line engineering reference documents and a user interface for the engineer are also getting development attention.

Niche Integration Versus Data Base Integration

Today, each of the top 10 mechanical CAD/CAM vendors has a solid modeling product. Dozens of others have, or are in the process of developing, their own products. The approach is different from vendor to vendor, but they fall into two general groups. The niche vendor approach capitalizes on an opportunity to focus on a vertical market and provide a high level of integration in a specific application area. The hope is to attract the user with special requirements, leading to higher-performance packages that are easier to use.

The system integrator approach is as broad as possible. By providing a complete package or a solid foundation for the total corporate graphics needs of a company, the vendor hopes to become the standard graphics tool supplier for the entire operation. As standards for communication improve, the opportunity for the system integrators and the niche suppliers to work together will improve as well.

The combined synergy and competitive pressure in this environment will push product development to high leveis in all application areas.

DATAQUEST believes that the niche developers will lead in developing innovative solutions in each of their application areas, but that the system integrators will be close behind taking advantage of any significant development.

The major development areas have been identified as finite element modeling, analysis and optimization, numerically controlled part programming, drafting/documentation, and design verification. As market leaders emerge, strategic alliances will be formed to move the niche solutions toward integration as complete systems. This process would be aided considerably if standards were in place to define the format of data to share between unlike systems.

CCIS © 1986 Dataquest Incorporated Feb. 21 2.5-5

2.5 MECHANICAL-SOLID MODELING

TECHNOLOGIES

Millions of dollars are being spent to improve performance, functionality, and user-interface operations. The following sections discuss the key technology development areas and identify their major features and current trends.

Modeling

The primary function of solid modeling is to give the user the ability to model completely any realizable object. Modeling development is being directed toward solving the deficiencies that limit the classes of parts that can be modeled.

Castings, forgings, and sculptured pieces such as automotive body parts are the most common problem areas. Making the part model more complete by more accurately capturing all relevant information in an easily maintained form is the key issue.

A current trend in making the systems easier to use is based on a modeling process that uses more complex primitive shapes called feature-based modeling.

Rather than using blocks, cones, or cylinders to form the part, standard part features are used as part construction operations. Asking for a drilled, countersunk, and tapped hole in a single operation is an example of this process. An extension of this process generates complete standard parts. By filling in questions to a parametric program, standard gears, pulleys, or brackets can be modeled. Any of these procedures can be custom tailored for the user company to reflect established company practices or manufacturing constraints. The rapid construction of standard part features or standard parts can improve the productivity of the system.

Feature-based modeling is a useful tool in moying solid modeling from a conceptual design to the mainstream of production design and manufacturing.

Adding tolerance data to the data structure is currently under study.

Longer-term developments center on modeling manufacturing processes and functional test environments. Accurately modeling processes such as painting, plating, or heat treatment may or may not be necessary; however, the information describing the operation must be captured and maintained with the part data base.

The complete part data base will support top-down part planning and bottom-up operation planning.

Display

Fast image generation has been an Achilles heel for solid modeling. Rapid rotation and translation of view and part orientation is essential for interactive design tasks. Application-specific VLSI and display packaging designed for this market are just becoming available to speed up this process.

Fortunately, one of the most successful development areas associated with solid modeling has been display. Image generation has progressed from hours and days worth of computing time to fractions of a minute. Images include wire-frame, hidden-line, and shaded images in isometric, perspective, single, or multiple views.

2.5-6 © 1986 Dataquest Incorporated Feb. 21 CCIS

2.5 M E C H A N I C A L - S O L I D MODELING

Application-specific ICs and displays designed for this task are solving the problem.

.Display performance is improving by a factor of approximately two each year. In

Other words, a 10,000-polygon shaded image could be rotated and redisplayed in one second a year ago. Now, 20,000 polygons can be processed in the same time, or 10,000 in half the time. Products released in 1986 are expected to handle

40,000 polygons in a second or less.

Realism in display is available with shadows, multiple colored light sources, and textures. Longer term, both image quality and speed of generation will improve, approaching movie film for imaging dynamics and quality. Raster

Technologies, Phoenix Data Systems, General Electric, and Silicon Graphics are leaders in the technology development of solid- modeling display.

User Interfaces

Enhanced user interface options include pop-up menus, icons, command

Strings, and programmable options for repeatable operations. The issue here is not

SO much, How is the interface presented?, as, Is it easy to use, self-teaching, predictable, reliable, and flexible enough to allow the construction of the necessary detail to accurately define the object for the follow-on operations? Combining the functional need with the diversity of potential users and with the possibility of building in some rule-based logic to speed up the process will keep the system designers busy for years. User interfaces that are programmable and custom tailored for the user are rapidly becoming the common expectation.

Data Base

The full potential of solid modeling will not be realized until all applications can work from the same data base. The data base will include many different types of information, but there will be one representation for the part description with

Other data related to it. This process will accurately capture the engineering data base, defining the legal part description and arcliival record. Where-used and made-from questions can be answered directly. The volume of information associated with this data base is direcriy related to the level of design and manufacturing automation installed at that time.

Application Interfaces

For solid modeling to become fully accepted, it must support all the major application areas. The primary issue involves taking advantage of the more complete data base. Solid modeling cannot be treated as an add-on application. It must be built in to the core system where the application code can depend on the information being available for use. Virtually any application can be improved and, in some cases, fully automated if the solid modeling techniques are available.

CCIS © 1986 Dataquest Incorporated Feb. 21 2.5-7

2.5 MECHANICAL-SOLID MODELING

CURRENT UNIVERSITY RESEARCH AND DEVELOPMENT ACTIVITY IN

SOLID MODELING

Universities around the world have been working on solid modeling- related issues for the last fifteen years. Several commercial products have evolved from university development, with ongoing development in progress at dozens of sites.

Table 2.5-2 lists the names of universities performing solid modeling research and development activities.

Table 2.5-2

University Research and Development Activity in Solid Modeling

U n i v e r s i t y

Carnegie-Mellon

Computer & Automation

Inst. Budapest

Modbuild

P r o j e c t N a m e *

Glide, BOS

Built^t-

Robotics

Mosy

M o d e l i n g

Modeling

Double quadratic surfaces

Cornell University

Cranfield Inst, of Tech.

Czech Tech. Univ. Prague

Federal Inst, of Tech. Zurich

Helsinki Univ. Technology

Hokkaido Univ., Japan

IBM U.K. Scientific Centre

Kemforschungszentrum Karlsruhe

Royal Inst, of Tech., Sweden

Leeds University

Loughborough Univ. of Tech.

Newcastle Polytechnic

Norwegian Inst, of

Tech./Sinteff

TIPS

Test Bed

Modeler

JOE/GSFEL

Euklid

GWB

TIP/GSP

Winsom

Gipsy

GPM

Noname (Boxer)

-

SWANS (Leeds)

Assembled

Plate

Genus

Motion synthesizer with movie interface

Auto generation and verification of NC

AI, process planning

CAM-I AIS, form features

Modeling

Modeling

Modeling, kinematics, and FEM generation

Geometric simulator

Organic molecule modeling

Application interfaces '

Modeling

Auto NC and FEM generation

CAM applications

Form-feature data base

Assembler welding

Politecnico di Milano

Polytechnic of Central London

Purdue University

RPI

Royal Inst, of Tech. Stockholm

Ruhr Univ.-Boehm

Tech. Research Centre Finland

Tech. Univ. Berlin

-

Cadme

-

Octree

GPM

Proren-2

Uniblock

ASP-GM

Compac

Baustein

Geometrie

Modeling, kinematics,

NC turning

CAD/CAM national project

Modeling, toierancing, NC

Modeling,

Modeling, ray tracing

Modeling, sheet metal, robotics, welding, AI

Modeling

Modeling, AI, FEM generation, kinematics

Modeling

Modeling, interfaces, AI

(Continued)

2.5-8

1986 Dataquest Incorporated Feb. 21

CCIS

2.5 MECHANICAL-SOLID MODELING

Table 2.5-2 (Continued)

University Research and Development Activity in Solid Modeling

University

Tech. Univ. Delft

Tech. Univ. Denmark

Project Name*

Raymo

SEDA

Technovision

(Compac)

Vole, Dora

Modeling

Ray tracing

Modeling

Univ. of Bath

Univ.

of Cambridge

Univ. of East Anglia

Univ. of Edinburgh

Univ. of Karlsruhe

Univ. of Michigan

Build II

-

Robmod

Dicad

Proren

Architectural

System

ASV

PADL II

Modeling

Raycasting, NC,

modeling

GKS graphics, autofeature recognition, auto NC, robotics

Solids/sculptured surfaces

Robotics

ModeUng, AI

Architectural modeling

Univ. of Rochester

Feature extraction

Object modeling

Process modeling

and planning

Free-form shapes, NC Univ. of Tokyo Oeomap

•Project or product names shown in parentheses indicate affiliations between universities and

commerical products.

Source: DATAQUEST

February 1986

END USERS

The users of solid modeling technology come from virtually all industrial sectors. Table 2.5-3 indicates the major industrial sectors and the corresponding primary area of use.

Table 2.5-3

Primary Solid Modeling Applications By Industry

ccis

Industry

Aerospace

Automotive

Architectural

Mechanical/Fabrication

Electro/Mechanical

Mapping

Application

Conceptual design—visualization

Design verification—packaging—visualization

Visualization

Packaging—early design—analysis

Packaging

Subterranean modeling

Source: DATAQUEST

February 1986

1986 Dataquest Incorporated Feb. 21

2.5-9

2.5 MECHANICAL-SOLID MODELING

Earlier this year, DATAQUEST conducted a user survey of more than 600 user sites. This survey was designed to define the current status of the use of solid modeling and the future expectation of use by industry. Based on the total response, 24 percent of the site managers said they were using solid modeling on their systems. This does not mean that 24 percent of all system hours are spent on solid modeling, but it does mean that 24 percent of the users have access to solid modeling if they need it. An additional 39 percent said they plan to use solid modeling in the future, 21 percent have no plans, and 16 percent do not know. This sets the ratio of believers to nonbelievers in the current CAD/CAM user base at

2 to 1. The challenge will be to make the systems good enough to attract the nonbelievers of the current user base and to become the preferred choice of new

CAD/CAM purchasers.

As Figure 2.5-1 indicates, aerospace has the highest level of installations by site, 39 percent. The high degree of complex new design work and a need for quality make the solid modeling systems attractive in the aerospace industry.

Architects have the highest ratio of current users who plan to use solid modeling. This 4.6 to 1 ratio shows a very large sales potential in the short term.

Historically, however, architects have looked for functionality in a low-cost package, which may slow solid modeling penetration into this market.

Figure 2.5-1

ANALYSIS OF USER SURVEY

SOLID MODELING USE BY INDUSTRIES

LEGEND

^ ^ NO PLANS

Y///A DON'T KNOW

• I HAVE PLJ^NS

^ ^ USING NOW

2.5-10

TOTAL AUTO MECHIFAB MAPPING

AEFRO ARCH ELEC/MECH

Source: DATAQUEST

February 1986

1986 Dataquest Incorporated Feb. 21 CCIS

2.5 MECHANICAL-SOLID MODELING

Mappers have the smallest level of interest in solid modeling by current users and those with plans to use it. It is worth noting that this group provides a good example of a vertical niche market. The portion of mapping that works with three-dimensional data obtained for subterranean modeling, mining, or oil exploration could benefit from solid modeling.

PENETRATION

Determining market penetration requires market sizing and setting the level of installed product. As always, definitions are necessary to put the data in proper context. Long term, DATAQUEST expects the potential solid modeling market to include 100 percent of mechanical and 80 percent of AEG markets. For this potential to be realized, solid modeling will be required to support all CAD/CAM applications as well as or better than they are supported today by wire-frame and surfacing technology.

Since today's systems use solid modeling as an add-on application or as a core system function, it is difficult to determine the level of use at the workstation level.

The 1985 DATAQUEST User Survey was used to set the current level of usage on a per-site basis. Roughly 25 percent of the CAD/C/^M user sites responding to the

1985 DATAQUEST User Survey were using solid modeling. This corresponds to more than 17,400 workstations installed worldwide with full or part-time access to solid modeling in 1984. DATAQUEST believes that market penetration by site will increase from approximately 25 percent in 1984, to 53 percent in 1989. An estimated 79 percent unit growth rate in 1985, forecast to increase to 101 percent in 1989, is responsible for the expected doubling of market penetration on a per site basis.

Penetration considering terminal hours used with direct access to a solid model data base is growing at a faster rate. The rapid transition of solid modeling as a core system function is the primary reason for this accelerated growth rate.

USER ISSUES

To live up to its full potential, solid modeling must pass an impressive set of hurdles. Functionality, ease of use, and price are some of the most significant barriers. The following segments discuss these issues from a user perspective, indicating the needs and level of expectation.

CCIS © 1986 Dataquest Incorporated Feb. 21 2.5-11

2.5 M E C H A N I C A L - S O L I P MODELING

Functionality

The basic modeling procedure is understood. A variety of standard objects are added or subtracted from each other to form the desired part. The current flexibility of this process will allow the precise modeling of fully machined parts.

Increasing the complexity of parts by including castings, forgings, molded, and formed parts, however, adds a level of difficulty that few solid modelers can address. Adding the constraint of building these complex models in a reasonable time frame is another major hurdle.

After building the model, the immediate question arises, "What can be done with it?" The first useful application is to look at it. The visualization process has virtually been solved from a functional view. The engineer can be his own artist and easily produce full color rendered images. Technical illustrations can be displayed that include line drawings in perspective, with hidden lines removed. Accurate, detailed sectioned views can be generated for use in design studies or for detail drawings. Still ahead are improved algorithms and special-purpose hardware that will produce images faster, with more realism and more user control, but at a lower cost.

Building two or more parts that fit together adds another dimension of complexity. Evaluating the nominal fit, mass properties, interferences, and relative motion in mechanism are all significant elements of required functionality. Each of these functions is currently available in various forms of utility and ease of use.

Building large assemblies with more than a thousand components is difficult if not impossible. Complex products or structures can easily have tens of thousands of parts. Configuration management of these large structures must be available. New techniques to allow the interactive use of these large data bases is essential.

The classic major application areas of CAD/CAM must be supported by solid modeling. These are finite element analysis, numerical control part programming, and documentation. Each area can take advantage of the more complete part model and produce precise results in a more automated, easier-to-use scenario. Rule-based procedures will complement the operation, giving the user more time to think about his problem and less time to worry about the steps he needs to follow to make it happen.

Dimensional tolerancing associated with solid modeling is a long-term functionality with exciting potential. Today, edges, holes, and profiles are stored in computers with one value for each component or feature. Allowing a multiple value or a range of values for each of these dimensions opens the door for more complete design evaluation, for manufacturing process optimization, and automated testing for quality assurance.

2.5-12 ©1986 Dataquest Incorporated Feb. 21 CCIS

2.5 M E C H A N I C A L - S O L I D MODELING

Solid modeling will provide an efficient base for geometric part data in corporate data bases. Access, format, control, and definition are a few of the major issues involved in using such a data base. By definition, a corporate data base must be accessible to anyone with a legitimate need for business information. Controlling the level of access to each of the functional groups or individuals is a nontrivial task, but it is essential in order to support the full level of communication requirements in industrial automation. Today's CAD/CAM products address the issues of local data bases and local area networks. The tools are just beginning to be available to put together large corporate data bases.

Standards are an essential ingredient in this scheme. Creating a format to capture the essence of product design and manufacturing information is the formidable task of several standards organizations. ISO/TC184-SC4, CAM-I/AIS,

ANSI/Y14.26, DIN/T/VP/VDA, /^FNOR-SET, and EEC-ESFRTT are leaders in this worldwide effort. / ^ in-depth look into this area will be the topic of a future research newsletter.

Users are asking for complete application integration as one of the most important components of a solids-based system. Unfortunately, asking ten users for a functional definition of a well-integrated system gets at least ten answers. From

DATAQUEST's current point of view, the most important solid modeling applications are:

• Finite element mesh generation and analysis

• Numerical control part programming

• Drafting and documentation

• Dimension tolerancing and analysis

• Design verification by interference detection

• Visualization

• Mass properties

As the quality and quantity of part geometry and associated information improves, thus defining a fully operational data base, the emphasis will focus on the flow of information and where it is used. Information integration is the primary goal tying organizations into a single business unit.

CCIS ©1986 Dataquest Incorporated Feb. 21 2.5-13

2.5 M E C H A N I C A L - S O L I D MODELING

Performance

The essential element of performance is to retain the interactive nature of the system, independent of the complexity involved. Every system operation, user interface, functionality, or output process has a performance element. Consider two highly functional systems, one interactive and responsive, the other batch-oriented and ponderous. Tiie first is a powerful design tool; the second is a laboratory curiosity. Blinding speed has been the dream of solid modeling practitioners since the first Boolean operation. The current rapid progress in computing horsepower and display processing are having a positive effect. But the general problem is far from being solved.

A close look at a realistic design problem illustrates the true need. Routing a hose through the engine compartment of an automobile and designing the necessary clamps and fittings can take weeks, working from engineering drawings.

Considering the effect of a simple modification to one of the parts or the diversity of engine options increases the complexity by an order of magnitude. Using a solid representation of the assembly with interactive performance would shorten the job to a few hours. Simulatifig the design process allowing fly-around display performance with models having thousands of parts is a real expectation of automotive, aerospace, and heavy industrial designers around the world.

In the example cited above, moving to a new location to see a fresh vantage point can require minutes or even hours with today's systems. The user needs less than one-second image redisplay time.

Subtracting one shape from another is a powerful modeling operation. Waiting more than a few seconds to see the result is frustrating and counterproductive.

Productivity

Productivity can be measured in many ways. Completing a measured task in half the time or less is understood to be productivity improvement. Completing a task that has never been done or never been possible to do, is difficult to quantify for productivity improvement. If the task is important, productivity is infinitely improved. Solid modeling opens the door for both types of productivity improvement.

The major ease-of-use issue relates directly to productivity. What percentage of the user's time is spent thinking about how to make the system do what he wants versus the time spent working directly on the problem? DATAQUEST believes that this ratio needs to be greater than 90 percent.

Assisting design or manufacturing applications is a primary function of solid modeling. What is the level of application integration? How much time is required to set up each operation? If the task requires a drawing to be generated, what convolutions are required to get the correct views on the paper? What happens to

2.5-14 ©1986 Dataquest Incorporated Feb. 21 CCIS

#

2.5 M E C H A N I C A L - S O L I D MODELING the drawing when the design is updated? Who is notified when engineering makes a change? A system approach to the above will profoundly improve the communication and productivity of the user's organization.

Ease of Use

Casual users who spend less than two hours per day on a system are the target for the designers of user interfaces. These users need to have a little handholding on each excursion into the land of computer- aided design and manufacturing. They do not want to be slowed down by menu structures or lengthy procedures of small,

"easily understood" command steps in the name of ease of use. On the other hand, they do need assistance in knowing what to do next. This is fertile ground for real innovation in system design.

A key element of ease of use is providing a self-teach mode of operation.

Ideally, the system could monitor the progress of the user and make suggestions for independent study or present tutorial sessions for the learning of new or revised functions.

Price

The performance and display requirements for most solid modeling applications force the use of high-end hardware packaging. Typically, the cost per terminal hour is between $20 and $30. Each potential user will need to evaluate the current level of functionality for proper application to his problem. For some users, the potential benefit could be a bargain at $100 per hour. For the rest, a wait of a year or two will make the difference.

Trends

Exaggerated vendor claims with high-level media coverage have produced overly optimistic expectations. This will continue due to the extremely competitive nature of this business and due to misunder- standings in dealing with the complex issues.

Conceptual design using solid modeling technology has proven to be effective.

Most short-term enhancements will evolve from this foundation.

The availability of the low-cost, high-performance drafting solution is good and bad for solid modeling developers. The good news is that an expensive system does not need to be tied up doing drafting. Developing a complete interface between the solid modeling design system and the high-performance, low-cost drafting system will solve the drafting application need. The bad news is that the user now has the choice: Does he buy tlvee or four drafting systems, or does he buy one solidsbased design system? DATAQUEST estimates that more than half of the total available mechanical CAD/CAM system hours are used for drafting. The current

CCIS © 1986 Dataquest Incorporated Feb. 21 2.5-15

2.5 M E C H A N I C A L - S O L I D MODELING users of three-dimensional design systems can off-load their drafting tasks to the new low-cost systems and free up already purchased design stations. Considering the availability of terminal hours, trained users, and established procedures, this could slow short-term demand for design systems.

ECONOMICS

Most of the primary U.S. manufacturing industries (which are the main targets of solid modeling systems) have experienced growth in value of shipments in the last few years. DATAQUEST expects that the major solid modeling end-use industries (including aerospace, automotive, metal working, and components) will continue positive growth through 1990. The design and manufacturing automation imperatives brought about by increasing foreign competition and the diminishing product life cycles are expected to fuel major automation investments.

Table 2.5-4 itemizes the major economic indicators for these industries.

Table 2.5-4

Major Economic Indicators For Manufacturing Industries

(Millions of Dollars Except as Noted)

1980

1984

C A G R

1980-1984

Aerospace Industry

SIC 372. 376

Value of Shipments

Value of Imports

Value of Exports

Total Employment

Nonproduction Workers

S58,400

S 3.200

$15,400

721,300

164,500

$80,100

$ 4,600

$15,100

713,900

178,000

8.2%

10.0%

(0.5%)

(0.3%)

2.0%

Motor Vehicle Composite

SIC 371X

Value of Shipments

Value of Imports

Value of Exports

Total Employment

Nonproduction Workers

Composite Metal Working, General

and Special Industrial Machinery

SIC 35XX

Value of Shipments

Value of Imports

Value of Exports

Total Employment

Nonproduction Workers

Composite General Components and

Auto Stampings

SIC 34XX

Value of Shipments

Value of Imports

Value of Exports

Total Employment

Nonproduction Workers

$104,500

S 20.100

$ 8,800

714,300

86,500

$98,200

$ 8,100

$22,300

1,200,000

215,000

$23,500

$ 1,300

$ 2,200

336.000

62,200

$178,500

$ 43,200

$ 10,500

784,700

73,800

$94,000

$10,700

$16,300

956,000

191,400

$30,900

$ 980

$ 2,200

322.000

57.600

.

14.3%

21.0%

4 . 4 %

2.4%

(3.9%)

(1.1%)

6.9%

(7.5%)

(5.5%)

(2.9%)

7.0%

(6.1%)

(0.3%)

(1.1%)

(1.9%)

Source:

U.S. Industrial Outlook—1985

U.S. Census—1980

2.5-16

1986 Dataquest Incorporated Feb. 21 CCIS

#

2.5 MECHANICAL-SOLID MODELING

MARKET FORECASTS

DATAQUEST's worldwide solid modeling market forecast is shown in Table

2.5-5. The revenue total includes new system revenue for hardware, software, add-on/upgrade workstations and software, and service. Systems include host-dependent, standalone, and personal computer-based systems. Workstations represent the sum of new and add-on units shipped with host-based systems, together with standalone and personal computer shipment forecasts.

Table 2.5-5

Worldwide Solid Modeling Market Forecast

By Product Type

(Millions of Dollars and Actual Units)

1984

Total

Revenue

Systems

Workstations

$488

958

3,732

Standalone

Revenue

Workstations

Host-Dependent

Revenue

Systems

Workstations

Personal Computer

Revenue

Workstations

$ 46

387

$442

571

3,345

$0

0

1985

$757

2,446

6,684

$123

1,208

$630

890

5,128

1986

$1,125

7.425

12,768

$364

4,096

$742

1,139

6,481

1987

$1,563

21,032

26.143

$817

10.561

$666

1.105

6.216

1988

1989

$2,307

46.885

50.941

$3,690

100,456

102,724

$1,640

25,103

t

$495

912

4,968

$3,075

55.406

$257

518

2.785

CAGR

1984-1989

49.9%

153.6%

94.1%

131.6%

169.9%

(10.3%)

( 1.9%)

( 3.6%)

$3

349

$20

2,191

$80

9,366

$172

20,870

$358

44.532

Source: DATAQUEST

February 1986

The solid modeling market forecast by region is shown in Table 2.5-6. ccis

1986 Dataquest Incorporated Feb. 21 2.5-17

2.S M E C H A N I C A L - S O L I D MODELING

Table 2.5-6

Solid Modeling Market Forecast

By Region

(Millions of Dollars and Actual Units)

1984 1985

1986 1987 1988 1989

CAGR

1984-1989

Worldwide

Revenue

Systems

Workstations

United States

Revenue

Systems

Workstations

Europe

Revenue

Systems

Workstation

Far East

Revenue

Systems

Workstations

Rest of World

Revenue

Systems

Workstations

$488

958

3,732

$757

2,446

6,684

$1,125

7.425

12,768

$1,563

21.032

26.143

$2,307

46,885

50,941

$3,690

100.456

102.724

49.9%

153.6%

94.1%

$302

594

2.314

$ 86

169

658

$ 88

172

S71

$ 12

23

90

$466

1.504

4.111

$131

425

1,160

$142

458

1,253

$ 18

59

160

$687

4.530

7.789

$193

1.273

2,189

$219

1,445

2,485

$27

178

306

$946

12.724

15.816

$265

3.563

4,429

$315

4,232

5,260

$38

513

638

$1,384

28,131

30,565

$386

7,839

8.517

$484

9.846

10.698

$53

1.069

1,161

$2,195

59,772

61.121

$607

16.535

16.908

$798

21.739

22,229

$89

2,411

2,465

48.7%

151.5%

92.5%

47.8%

150.1%

91.4%

55.6%

163.2%

101.4%

49.9%

153.6%

94.1%

Source: DATAQUEST

February 1986

MARKET SHARE ANALYSIS

The three groups of companies profiled in Table 2.5-7 indicate market share analysis by vendor and number of installed workstations with access to the named product. The level of utilization of the solid modeling product or module is expected to range from often to full-time. Group A represents vendors with established solid modeling products in production in many user organizations.

Group B includes emerging products by well-known vendors or second sources for third-party software products. Group C includes the newest entries with just announced products or products in beta test. Some of the latest technology can be found in these products.

2.5-18

1986 Dataquest Incorporated Feb. 21

CCIS

2.5 MECHANICAL-SOLID MODELING

?J^t. Sv"f^A^^

Table 2.5-7

SOLID MODELING MARKET SHARE ANALYSIS

Company

Product

Group A'

Applicon

CADCentre

Computervision Corp.

Control Data Corp.

GE-CAE InternaUonal

IBM

MAGI

Matra Datavision Inc.

McDonnell Douglas Mfg. Info. Systems

Prime Computer

Group B*

Auto-trol Technology Corp.

Calma Co.

Evans & Sutherland Computer Co.

Ferranti Infographics

GMWC

IBM

Manufacturing & Consulting Services

Solids Modeling II

PDMS

MEDUSA (CIS), SOLIDESIGN

ICEM

GEOMOD

CATIA

Synthavision

EUCLID

UNISOLIDS

PRIME MEDUSA

Series 7000 Solids Modeling

GEOMOD

ROMULUS

CAM-X ROMULUS

RUCAPS

CAEDS

OMNISOLIDS

Group C

Automation Technology Products

British Technology Group

Cimlink Inc.

CAElec Software Inc.

CAD AM Inc.

Catronix Corp.

Cadetron

Cubicomp Corp.

CSA

Daisy

Gerber Systems Technology Inc.

Graftek

Gould

Harris Corp.

Hewlett-Packard

IBM

Interactive Computer Modeling Inc.

Intergraph Corp.

Isykon

Norsk Data

Pafec Inc.

PDA Engineering

Perspective Design Ltd.

Phoenix Data Systems

Sperry Corp.

Swanson Analysis Systems Inc.

Tektronix Inc.

CIMPLEX

VOLE

Component Geometry Modeller

PRO-SOLID

Solids Modeler (MAGI)

CATSOLID

Cadresolids

CS-5 PolyCAD 10

Solid Modeler

Gemsmith

GST-Solid

Solid Modeling System

Gemsmith

HarrisCAD

SMD-Solid Modeling Design

CADAM

GMS

Solid Modeler

PROREN

TECHNOVISION

Boxer

PATRAN II

MicroSolid

Insight

CIM/ME Solid Modeler

ANSYS

PATRAN II i?o4.^ Sut> - o*^ ^'

'Companies with products installed on more than SOO workstations

'Companies with products installed on more than 100 workstations

^Companies with products in development, in beta test, or recently released

Source: DATAQUEST

February 1986

CCIS 1986 Dataquest Incorporated Feb. 21

2.5-19

2.5 M E C H A N I C A L - S O L I D MODELING

DATAQUEST ANALYSIS

The Promise

The promise of real-world simulation in a computer system conjures visions of electronic sculpting and forming with the ease of hands on clay. The designer's eye gazes upon the full color shaded images and sees a new product evolve from an idea to a tested concept in an afternoon. The promise of products optimized for performance and quality will result'in improved profitability for the company. The full realization of this promise will revolutionize the industrial sector.

The Wait

Remarkable progress has been made in turning promise into reality. Niche markets have demonstrated many of the concepts, proving their feasibility.

Conceptual design has been the most successful niche market, proving the effective combination of solid modeling and analysis. Close integration with other design and manufacturing applications are in development. The future of solid modeling is directly dependent upon the successful implementation of the fully integrated system; the add-on approach will not serve the real needs of the user. The application packages must be able to depend on the availability of solid modeling information to reach the next plateau of system performance and functionality.

The Winners

The person, group, department, division, and/or company that understands the effective use of solids-based CAD/CAM will have a basic competitive advantage over the nonusers. Products that are produced from C/UD/CAM systems based on solid modeling and on the application packages that take full advantage of the technology will be more competitive, more reliable, less costly, and more profitable. Solid modeling is making the mechanical CAD/CAM business exciting again.

2.5-20 © 1986 Dataquest Incorporated Feb. 21 CCIS

2.6 Mechanical Computer-Aided Engineering (MCAE)

MCAE-KEY TO

HIGHER

CORPORATE

PROFirABILITY

Source: DATAQUEST

August 1986

INTRODUCTION

Mechanical computer-aided engineering (MCAE) is moving into center stage as a main character in the evolution of CAD/CAM. Esoteric analysis and mediocre modeling methods are evolving toward highly functional engineering tools, using the latest in high-performance graphics display and computation. Because MCAE technology is changing the way that the world designs its products, it must be considered by every major manufacturing corporation. The ability of a company to remain profitable will depend more and more on its ability to effectively use MCAE technology. MCAE is a major key to higher corporate profitability.

The purpose of this service section is to provide a background of information describing the history and expected evolution of this important and growing segment of the mechanical CAJD/CAM application. The market forecast is given with the supporting significant trends and assumptions. A perspective on driving issues is presented with analysis. Highlights from the section with an overall analysis are found in the concluding Dataquest analysis. Please review the following definitions to confirm the scope of this analysis.

CCIS Markets 1986 Dataquest Incorporated September 2.6-1

2.6 Mechanical Computer-Aided Engineering (MCAE)

DEFINinGN

Mechanical computer-aided engineering (MCAE) has a broad range of definitions, depending on the mechanical application and type of user. A full understanding of the MCAE process should consider all software packages that an engineer or designer would likely incorporate in the everyday use of his workstation. Spreadsheets, word processors, and electronic mail are a few of the major applications outside of engineering graphics that are commonly required to improve the productivity of the designer or engineer.

In general, the largest MCAE effort is directed toward product design, but an important and growing application group includes use of MCAE tools for manufacturing support in the form of design and analysis for tooling, molds and dies, fixtures, material handling equipment, or packaging. The MCAE application in this analysis is limited to the computer graphics tools that have been developed to aid the product design and analysis process, separate from documentation or manufacturing tasks. Software for supporting administration or management tasks is not included.

The design and analysis activities supporting the product design and analysis process exist in two major areas: conceptual design and detail product design, more commonly referred to as computer-aided design (CAD). The functional requirements of conceptual design and detail product design are alike, with growing similarity. The need to share information back and forth between these operations is pushing the requirements even closer. This trend in evolution of common interface, sharing of data, and functional commonalty is the basis for combining the products and markets of conceptual design and CAD, calling the result mechanical computer-aided engineering.

DRIVING FACTORS

Early Design Optimization

The design engineer is the primary individual affecting the design process from early conceptual proposal throughout production of detailed plans ready for transfer to manufacturing. Tliis process of design evolves through many stages, depending on product complexity. A common thread is evident across many industries. As the first 5 percent of time and dollars are spent in the product development process,

85 percent of the total life-cycle costs are committed. In other words, the most critical product design decisions are made during the earliest stage of design effort.

This data was reported from British aerospace and has been echoed as typical from many manufacturing operations. Figure 2.6-1 illustrates this trend in cost commitment in the product development process.

2.6-2 © 1986 Dataquest Incorporated September CCIS Markets

2.6 Mechanical Computer-Aided Engineering (MCAE)

Figure 2.6-1

Cost Profile Of Development Process

Product Ufe-Cycle Cost

Committed

Cost

Development Time and

Cost—As Spent

Time

Source: SDRC

Dataquest

August 1986

The two biggest problems with this traditional approach to product development are the following:

• The greatest opportunity to affect the design is given up after expending only 5 percent of design effort.

• Because of the analysis and test activities that take place later in the process, major design problems often do not show up until later; by then it may be too late to implement an optimal design change.

Cost of Engineering Change

Another way of visualizing this commitment to cost over time is to consider the estimated cost of a design change at different stages in the product life cycle. The following breakdown illustrates approximate costs for engineering changes at each stage:

Cost of an engineering change:

• In drawing board stage—$1

• In design checking—$10

CCIS Markets

1986 Dataquest Incorporated September

2.6-3

2.6 Mechanical Computer-Aided Engineering (MCAE)

• In process planning—$100

• In manufacturing engineering—$1,000

• In final production—$10,000

• /^ter field failure—$100,000 or more

The real objective of MCAE was succinctly given by Brad Morley, Vice

President of Product Development at SDRC, during the 1986 Dataquest Industry

Conference. "The real objective of MCAE," said Mr. Morley, "is in providing technology to the design engineer up front in the product development process when there is the greatest opportunity to affect the product design, while, at the same time, providing tools which allow for the effective evaluation of many different design concepts during the early stages of product development when the cost per change is least expensive."

Implementation Cost

The above issues of early design optimization and cost of engineering change have always existed. Another limiting factor in the expansion of M C / ^ is directly related to high cost of implementation. Low-cost systems will fuel growth of MCAE because the largest market is comprised of casual users with less sophisticated requirements. Higher-performance systems will also lower the effective cost, putting more powerful systems in the hands of the experienced user.

Access

The issue of access is critical to the future of MCAE and CAD/CAM in general.

Every time an interface is created between manual methods and automation, an inefficiency is introduced. Hopefully, the islands of automation more than compensate for the overhead of a partially automated process. The complete benefit of design and manufacturing automation cannot be realized until everyone with a need has ready access to a workstation. MCAE can be seen as an enabling technology automating a large and important segment of the overall manufacturing process.

HISTORICAL PERSPECTIVE

The design and analysis activities associated with MCAE have evolved from two distinct approaches with very different software functionality and different typical users. The common company requirements of design verification and analysis are driving the development of both approaches toward a similar

2.6-4 © 1986 Dataquest Incorporated September CCIS Markets

2.6 Mechanical Computer-Aided Engineering (MCAE) functionality and a larger target market. Recently a third development path has surfaced with a viable success opportunity.

Evolution of MCAE from Turnkey Vendors

The first step in MCAE development came as an outgrowth of computer- aided design and drafting, or CAD. In this context, M C / ^ is design and analysis primarily by S-D^ wireframe modeling techniques but includes 2-D modeling and

3-D surfacing modeling for design and analysis. The early market share leaders in

CAD/CAM—such as Computervision, Applicon, Calma, Autotrol, McDonnell

Douglas, and Cadam—are good examples of vendors with wireframe-based MCAE tools. A Dataquest end-user survey indicates that a majority of current design and analysis activities are accomplished with these tools.

In general, the CAD approach has evolved from early drafting applications and, as a result, has retained a detail design focus. The strengths of this focus provide robust component design and analysis with an emphasis on proper fit of mating surfaces in assemblies. Typically, analysis ranges from simple clearance measurement between two parts in an assembly to kinematic evaluations of assemblies.

The modeling function to support CAD design and analysis activity is evolving toward solid modeling implemented as a core system function. The effects of this more complete modeling tool will enhance the performance, ease of use, and range of effective applications as solid modeling product developments are turned into effective tools.

Evolution of MCAE from Advanced Analytical Software Vendors

The second path of MCAE development started in component design analysis with strong dependence on finite-element techniques. MacNeal-Schwendler, PDA

Engineering, SDRC, and Swanson Analysis are good examples of the early leaders in finite-element modeling and analysis (FEM/FEA). Part analysis after failure in the field was the most typical use of early FEM/FEA software. As batch mode processing and tedious digitizing input processing gave way to more automated operation, the design analysis tools gained wider acceptance. An increasing volume of analysis was performed before the actual part or assembly was constructed. The time saved in finding a major problem at this early stage of product development was found to contribute sizable savings in time and expenses. As conceptual design improved in performance and price, it became a proven, useful analytical tool.

The need to improve the modeling function to support the analysis operation has promoted the use of 3-D modeling techniques, with solid modeling becoming the preferred modeling method. Solid modeling includes the opportunity to automate the finite-element meshing operation, optimizing the design with recursive

CCIS Markets © 1986 Dataquest Incorporated September 2.6-5

2.6 Mechanical Computer-Aided Engineering (MCAE) analysis/modification. As with the turnkey vendors, solid modeling is becoming the modeling technique of choice.

The Latest Approach—MCAE as the Engineer's Tool Box

Most recent MCAE developments have taken a new path. The target market is focused on the casual user as engineer or designer. Electronic reference handbooks, sketch-mode data entry, solid modeling, design analysis, and project management tools are mixed together in a variety of cost/performance packages. Several companies have released products or will release products in the near future using these features combined with established modeling and analysis functions. Aries and Cognition are notable vendors of products aimed at the user with full-time custody but part-time operation of MCAE.

Artificial intelligence, computational, and data base servers are playing an important role in improving the usability and performance of the part-time MCAE resource. The vendor move to capture the engineer's desktop will proceed along the price/performance battle line well into the 1990s.

VENDOR PERSPECTIVE

MCAE Vendors—Who Are They?

Depending on the marketing focus of the vendor, some may or may not believe that they are involved in the MCAE market. As always, definitions are everything in sizing the market and measuring the major players. The Dataquest definition states,

"If a system can perform design and/or analysis of mechanical components, it can qualify as having an MCAE functionality." With this definition in mind, an evaluation can be made of the more than 500 worldwide CAD/CAM vendors to determine the population of MCAE vendors. The list developed from the Dataquest

Who's Who in CAD/CAM data base is shown in Table 2.6-1. More than 100 MCAE vendors are listed, along with an indication of product features.

The top ten MCAE vendors have been evaluated, with the results presented in the market share analysis section. The mechanical turnkey CAD/CAM vendors dominated the list, taking six of the top ten positions. Software-only vendors focusing on design and analysis applications comprised the remaining four positions. The "Other" group that makes up only 10 percent of the MCAE market is comprised of a long list of vendors.

2.6-6 © 1986 Dataquest Incorporated September CCIS Markets

2.6 Mechanical Computer-Aided Engineering (MCAE)

Table 2.6-1

Worldwide MCAE Vendor and Feature Matrix

VENDOR NAME

4-D GRAPHICS, INC.

ALGOR INTERACTIVE SYSTEkHS. INC.

AMERICAN COMPUTERS It ENGINEERS. INC

ANDROMEDA SYSTEMS. I N C

APPLICON

ARIES TECHNOLOGY

ASAHI OPTICAL CO.. LTD.

AUTO-TROL TECHNOLOGY CORP.

AUTOMATION TECHNOLOGY PRODUCTS

BRI6HAM YOUNG UNIVERSITY

BROOKS SCIENTIFIC

CADAM. INC.

CADCENTRE LTD.

CAOETRON. INC.

CALMA CO.

CAV CORP.

CELESTIAL SOFTWARE. INC.

CIMLINC. I N C

CISIGRAPH

COADE

COGNITION, I N C

COMPUTERVISION CORP.

CONTROL DATA CORP.

COUNTING HOUSE COMPUTER SYSTEMS LTD.

CUBICOMP CORP.

CYMBOL CYBERNETICS CORP.

DAKOTA CADWORKS

DASSAULT SYSTEMES

DELTACAM SYSTEMS LTD.

DYNACOMP. I N C

ENERTRONICS RESEARCH. I N C

ENGINEERING COMPUTER SERVICES

ENGINEERING MECHANICS RESEARCH

ENGINEERING METHODS. I N C

ENGINEERING SYSTEMS

CORP.

EVANS IE SUTHERLAND COMPUTER

CORP.

FERRANTI INFOGRAPHICS

LTD.

FUJITSU. LTD.

6ERBER SYSTEMS TECHNOLOGY. I N C

GRAFTEK

H.6. ENGINEERING LTD.

HAKUTO CO.. LTD.

HARRIS CORP.

HEWLETT-PACKARD CO.

HITACHI ZOSEN INFO. SYSTEMS CO.

HITACHI, LTD.

HONEYWELL INFORMATION SYSTEMS

IBM

I CAT

INNOVATIVE COMPUTER-AIDED TECH. INC

INTERACTIVE COMPUTER MODELLING. INC

INTERGRAPH CORP.

INTERNATIONAL COMPUTERS LTD.

ISYKON SOFTWARE GMBH

KANEMATSU ELECTRONICS, LTD.

KINTECH. INC.

KONGSBERG

SURFACES

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

(Continued)

X

X

X

X

X

X

CCIS Markets 1986 Dataquest Incorporated September

2.6-7

2.6 Mechanical Computer-Aided Engineering (MCAE)

Table 2.6-1 (Continued)

Worldwide MCAE Vendor and Feature Matrix

VENDOR NAME

MACNEAL-SCHWENDLER CORP.

MAGI. CAD/CAM DIVISION

MANUFACTURING K CONSULTING SERVICES

MARC SOFTWARE INTERNATIONAL. INC.

MARUBENI HYTECH CO.. LTD.

MATRA DATAVISION. INC.

MCCLINTOCK CORP.

MCDONNELL DOUGLAS MFG. INFO SYSTEMS

MERLIN TECHNOLOGIES. INC.

MICRO AIDED ENGINEERING

MICRO CONTROL SYSTEMS

MICROCAD LTD.

MITSUBISHI ELECTRIC CORP.

MITSUI ENGINEERING IC SHIP. CORP.

MOHANGO. INC

MUTOH INDUSTRIES. LTD.

NEC CORP.

NESTLER ELECTRONICS GMBH

NIHON DIGITAL EQUIPMENT CORP.

NIPPON UNIVAC KAISHA. LTD.

NORSK TECHNOVISION (DIETZ)

NUMBER C R U N C H I N G MICROSYSTEMS. INC.

PACE SYSTEMS. INC.

PAFEC ENGINEERING CONSULTANTS

PDA ENGINEERING

PISCES INTERNATIONAL CO.

PM INTERNATIONAL

PRIME COMPUTER JAPAN. LTD

PRIME COMPUTER. I N C

RIKEI CORP.

ROBCAO U.S.A.

SEIKO INSTRUMENTS

k

E L E C . LTD.

SHAPE DATA LTD.

SIEMENS AG

SPERRY CORP.

STRESS ANALYSIS ASSOCIATES.

INC.

STRUCTURAL DYNAMICS RESEARCH CORP.

STRUCTURAL RESEARCH ft ANALYSIS

CORP.

SUMISHO ELECTRONICS CO.

SUMMIT CAD

CORP.

SWANSON ANALYSIS SYSTEMS,

INC.

TASVIR CORP.

TEKTRONIX.

INC.

TELEMECANIQUE

TOSHIBA

CORP.

TOYO INFORMATION SYSTEMS.

LTD.

UNICAD. I N C

UNITED INFORMATION SERVICES. I N C

UNIVERSAL INTERGRAPHIX

CORP.

YOKOGAWA HEWLETT-PACKARD. LTD.

YOKOGAWA HOKUSHIN ELECTRIC

CORP.

ZUKEN.

INC.

3-D WIREFRAME

SURFACES

SOLIDS

MODELING FEM/FEA KINEMATICS

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

x

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

*

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

x"

X

X

X

X

X

X

X

X

X

X

X

X

X

X

• • *

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

Source: DATAQUEST

August 1986

2.6-8

1986 Dataquest Incorporated September

CCIS Markets

2.6 Mechanical Computer-Aided Engineering (MCAE)

The Development Path

Conceptual design and detail product design are evolving into a cohesive evolutionary direction for MCAE. Specifically, Dataquest expects MCAE to form the backbone of manufacturing corporate data bases by developing the primary

CAD/C/y/I tool to create and update engineering information. Within this framework, a great variety of vendor offerings will be derived from the combination of target markets as defined by industry and user, with hardware and software products in several price/performance packages. A prevailing hypothesis in the industry expects every engineer, designer, and technician to have an engineering workstation installed on his or her desk. Vendors are trying to develop the right combination of tools to gain maximum acceptance on the desktop.

Integration—Now or Later?

If a group of users is asked to list the top five areas of concern, the first or second issue listed is usually integration. A reasonable second question, then, is:

"What do you mean by integration?" If there are 50 people in the group, you will most likely get 50 different answers. A typical response will include phrases like common data base, uniform user interface, and upgradability. A pragmatic respondent would ask first: "Can I get my job done?" The second question would be: "What is the effort required?" This ease-of-use and functionality resolution determines the suitability of all MCAE tools to be used by the target market.

Integration can and should be evaluated at the user, group, and corporate levels.

For each member of a well-integrated system, the questions are the same: "Can I do the job, and is it worth the effort?"

MCAE has focused on the design and analysis task, bringing a closely integrated tool to a wide variety of potential users. The type of user in each target market is driving MCAE development as much as any other single factor. The esoteric specialty MCAE tools developed for Ph.D.s in crucial tasks differ significantly from the part-time design aid for the designer or technician.

Looking beyond MCAE, integration of M C / ^ tools must be closely allied with the Other major CAD/CAM functions of documentation and manufacturing. The full benefit of CAD/CAM will not be realized until a fully integrated solution can be implemented with complete access by all involved. The implication here predicts

CAD/CAM access to become as common as talking on the telephone. MCAE in this context will meet the total design and analysis requirements of the user, group, and corporation.

CCIS Markets © 1986 Dataquest Incorporated September 2.6-9

2.6 Mechanical Computer-Aided Engineering (MCAE)

TECHNOLOGIES

Virtually all technologies important to the CAD/CAM industry are having an impact on M C / ^ . Hardware improvements are raising performance and lowering price on the full range of processor types. Display technology is resulting in fixed-configuration price reductions in the range of 15 percent per year. Highperformance display of realistic images is finding widespread application as simulation activity increases. Software enhancements are opening up new applications with easier-to-use interfaces. Overall, the systems resulting from the rapid advances in each of the above enabling technologies can potentially change the way the world designs its products.

Modeling

The first step in any design and analysis task requires the construction of some kind of computer graphics model. There are three basic forms using 2-D, 3-D wireframe/surfacing, and solid modeling construction techniques. Each has inherent advantages in ease of use and speed. Since the vast majority of the world's products have been designed on pieces of paper, it is easy to believe that today's high-performance 2-D drawing systems can be effective design tools. The 3-D design systems developed since the mid-1970s have proven the concept and value of design in a simulated 3-D space. Solid modeling has taken over as the modeling technique of choice if 3-D modeling is required. As the dropping price/performance curve brings high-performance systems within the price range of the buyer, systems based on solid modeling will proliferate. Every major CAD/CAM and MCAE vendor has solid-modeling-based products in a current product offering or in development.

Any limitation in modeling will directly limit the range or class of products that can be effectively designed or analyzed with that tool. Many 2-D systems have reached functional equivalence with manual drafting methods, meeting all engineering drawing standards. The limitations remaining are inherent to the 2-D representation, which is primarily one of interpretation. Considering 3-D modeling, it is interesting to observe that not a single vendor has made the claim of having a solid modeler that can precisely model all parts and assemblies commonly found in industry.

Analysis

The status of design evaluation can be illustrated by considering that the largest drawing has been made in a graphics system, but the largest design or analysis problem is still orders of magnitude away from realization. This premise indicates a strong appetite for systems able to handle much larger problems with faster response times. The expected, more robust operation can also handle more detail in the analysis, potentially improving the quality of the design and reducing the skill

2.6-10 © 1986 Dataquest Incorporated September CCIS Markets

2.6 Mechanical Computer-Aided Engineering (MCAE) level of the operator to set up the problem. In general, the analysis function is becoming easier to use with an application interface that more closely speaks the language of the end-user application. Presenting a menu of material choices rather than just prompting for a material density value illustrates the trend in improving ease of use. Automatically preparing a design model for stress analysis using material and boundary condition information derived from the model is a more beneficial illustration.

The MCAE evolution can be viewed from several vantage points. The novice or casual-user approach is being addressed by the blending of engineering sketching, engineering handbook reference, and product design procedures into an easy-to-use package. The result is aimed at the engineer or designer with unpretentious design and analysis requirements who has a small amount of time to learn or releam the use of the system.

The midrange user is typically concerned with complete product design from concept to component detail. Verification of the fit and function of the assembly is a common requirement with mass property and kinematic studies included. This mainstream application segment has been addressed by the 3-D wireframe

CAD/CAM systems with reasonable success.

At the high end, the experts are willing to put up with just about any convoluted interface or procedure as long as it gets the job done. Casual or part-time users with less than optimal experience and training can easily get bogged down trying to solve some of the more complex problems with little probability of reaching a correct result. Finite-element modeling and analysis (FEM/FEA) programs are prime examples of this analytical approach. Fortunately, all of the major FEM/FEA vendors are hard at work improving the user interface, adding error detection, and enhancing analytical applications to reduce the operational overhead. All computer types from personal computers to supercomputers are being used effectively.

New Development Areas

Virtually every advancement in computing hardware can be utilized in MCAE.

From application-specific integrated circuits (ASICs) to plug-in boards to super computers, almost every hardware technology and packaging scheme is being used to improve performance and lower price.

Processors

Engineering workstations are evolving quickly from a marginal computing resource to a 5-MIF+ processor with very attractive pricing. The supercomputer is evolving, increasing the practical limits of problem solving for aerodynamic, fluid flow, and weather simulations. Processors used as network servers are improving the performance levels of groups of workstations requiring nominal investments.

CCIS Markets © 1986 Dataquest Incorporated September 2.6-11

2.6 Mechanical Computer-Aided Engineering (MCAE)

Display

The expectation of real-time simulation is driving display technology. An interesting observation finds that the pressure to develop an ultrafast display operation is difficult to justify from the standpoint of just a quicker picture maker.

The prestige of owning and developing the fastest display in town seems to be a significant incentive. The users want it, but they don't seem willing to pay extra for it. The developers are spending millions in VLSI development to make it work.

Dataquest believes that a strong opportunity exists for an MCAE product optimized for a highly interactive environment. Once users have access to a fully operational system with a user interface optimized for fast interaction, they will never go back to the old way of doing business.

Optimization

The closer integration of design and analysis techniques is opening the door for optimization processing. This implies a computer-controlled modification of the design model based on a set of rules and results of each iteration of the analysis.

Full implementation of this process is years away, but the potential benefit is enormous, affecting every aspect of product design.

New Algorithms

More efficient algorithms that should speed up processing are now in development. The "P-version" of the finite-element method is an example that constructs the model for analysis out of larger elements that more closely follow the shape of the model. A more accurate and faster analysis can result. This approach lends itself toward further automation in model generation and significant analysis performance improvement, but it needs to be proven for more than the 2-D elastostatic analysis so far demonstrated.

New Applications

Design constraints for higher strength and lower weight are forcing new design and analysis efforts in applications that have not historically required robust evaluation. The development of new engineering materials in the form of plastics, composite materials, metal alloys, and ceramics is compounding the complexity by combining new product design with new engineering materials. Precise modeling and analysis of these materials with simulation of the design in the as-used environment are leading the way to new development areas for MCAE.

Artificial intelligence, rule-based programming, and data base enhancements are being used to enhance MCAE development. The resulting systems promise to be more valuable with efficient user interfaces.

2.6-12 ©1986 Dataquest Incorporated September CCIS Markets

2.6 Mechanical Computer-Aided Engineering (MCAE)

END USERS

MCAE System Utilization by the Industry

The users of MCAE are found in all manufacturing industries. Every industry has CAD/CAiM installations involved with design and analysis of the manufactured products. A recent Dataquest survey determined the percentage of system utilization for the four primary application areas in mechanical CAD/CAM. The applications measured were design, analysis, drafting, and manufacturing.

Combining the design and analysis percentages on an industry-by-industry basis provides the data shown in Table 2.6-2.

Table 2.6-2 is based on the 1985 Dataquest end-user survey. Number of sites indicate total number of sites responding to the survey, sorted by industry.

Percentages represent the percentage of sites with mechanical applications and the percentage of system operations utilized for MCAE applications. The

MCAE percentage is comprised of the sum of the design percentage and the analysis percentage.

Manufacturers in the computer, automotive, communication, and aerospace industries are the largest users of MCAE, based on the percentage of system use.

The mechanical machinery industry is also large as a result of extensive use of mechanical CAD/CAM applications.

Table 2.6-2

System Utilization for MCAE/Design and Analysis

Indust r i es

Computer

Automot ive

Cornmun i cat i ons

Aerospace

Other

Mechani cal

Moch i nery

E1ect r i ca1

Mach i nery

Transportat1 on

Fab Metal

Number of Sites

Percent

Mechani ca 1

AppIi cat

i ons

M C A E

Ut i1i zat ion

Des i gn

Percent

Ana 1ys i s

Percent

38

49

16

68

94

66%

70%

63X

68%

71%

46%

45%

43%

41%

39%

3 9 %

38%

34%

31%

29%

7%

7%

9%

10%

10%

6% 54

106

18

56

91%

76%

83%

78%

38%

35%

32%

28%

32%

30%

22%

2 3 %

5%

10%

5 %

Sou rce :

DATAQUEST

August 1986

CCIS Markets

1986 Dataquest Incorporated September

2.6-13

2.6 Mechanical Computer-Aided Engineering (MCAE)

PENETRATION

The level of penetration in mechanical CAD/CAM is defined to be the ratio of installed workstations to the population of users and potential users. Dataquest expects this ratio, in the long term, to approach 100 percent as workstation access becomes common. Since M C / ^ is viewed by Dataquest as a keystone in mechanical CAD/CAM development, the trend toward full implementation of

MCAE is expected to continue with high probability.

The current penetration levels for MCAE can be estimated by using the

Dataquest data base for workstations installed, Dataquest end-user survey data, and user population estimates from U.S. census data. The following should be noted about M C / ^ penetration levels:

• In 1985, there were approximately 44,800 workstations in use in the United

States for mechanical applications. This population is expected to grow to

67,300 in 1986.

• Of the installed base in 1985, approximately 36 percent of that resource is used for MCAE activity. This is expected to increase to 42 percent in

1990 and to increase further to 48 percent in 1996.

• The population of all mechanical and industrial engineers, technicians, and drafters in the United States in the major manufacturing industries (S.I.C.

34, 35, 36, 37) is estimated to be 385,500 in 1985 and 397,000 in 1986.

• The resulting penetration percentage is approximately 12 percent in

1985 and 17 percent in 1986.

The above information can only be used as an indication of penetration. The following considerations need to be made to better understand the current situation:

• The population of engineers, technicians, and drafters in the above selected

S.LC. code groups represent only 49 percent of the total. Other groups such as governmental agencies, education, and other manufacturing industries are important potential markets.

• Dataquest survey data indicate higher penetration levels if measured by the number of trained users compared with the number of installed workstations. Approximately 2.9 users have been trained for each installed workstation in the major manufacturing industries.

• The average utilization rate of the installed base of mechanical CAD/CAM workstations is estimated to be 12 hours per day, based on 1985 Dataquest survey data. Many of the trained users mentioned above are required to keep the installed base of workstations busy for more than 12 hours per day. As the part-time user with a dedicated workstation becomes more prevalent, the overall average utilization rate is expected to drop to less than 6 hours per day. High-performance/high-cost workstations will continue to be used more than 8 hours per day, with low-cost workstations used only 20 to 30 percent of the time.

2.6-14 ©1986 Dataquest Incorporated September CCIS Markets

2.6 Mechanical Computer-Aided Engineering (MCAE)

USER ISSUES

Performance Requirements for Display and Computation

The appetite for computer horsepower and display performance for design and analysis activities is insatiable. A reasonable means of visualizing this situation is to suggest that the largest drawing has been constructed in a CAD/CAM system. The largest design or analysis problem is still orders of magnitude away from realization. Display and manipulation operations must support the growing problem complexity and provide subsecond response time to reach the next plateau of user productivity.

Cost Per Seat

The cost of system purchase and/or lease, including operation costs, must be low enough to allow widespread implementation on a corporate level. The magic number for wholesale installation is expected to be in the $10,000 to

$20,000 range. PC-based products in that range have experienced phenomenal growth.

A composite average of $54,300 for mechanical applications in 1985 is expected to drop to $26,800 in 1990. The composite average of MCAE workstations is expected to follow a similar price reduction.

Ease of Use

Ease of use is something that every vendor claims but few demonstrate with any unique capability. The full-time user needs an improved interface to drive the higher-performance systems being developed. At the low end, the standard fare of menus, icons, mice, and prompting will have to suffice. Since the lower-cost systems are generally used by the casual users, it is very important to provide an easy-to-learn and relearn interface. On-line tutorial and help functions are suggested by users as beneficial. ^

Networking

Networking must provide communications between systems and accommodate computational and data base servers. The transfer of engineering data, both inside and outside a company, are essential. Transfer of IGES files are common now in the automotive industry between the major manufacturers and first-line suppliers.

Networking is an integral necessity in completing the communications path of design and manufacturing automation.

CCIS Markets © 1986 Dataquest Incorporated September 2.6-15

2.6 Mechanical Computer-Aided Engineering (MCAE)

Data-Base Management

Data-base management with associativity between part geometry and nongraphic engineering data is necessary to maintain reliable design control and management.

Complete Part Modeling Functions

The I-can-model-anything modeler is not required to set up FEM/FEA analysis problems. Simplifications are made to speed up the process, hopefully, not distorting the results of the analysis. Advancements in computational resources and automated analysis techniques will make the approximations that are common today be obsolete in the near term, as fully detailed parts and assemblies are optimized under program control.

Data-Base Evolution Toward Corporate Definition

For the MCAE process to feed the downstream detail design and manufacturing operations, a complete geometric modeling function must be provided. This does not imply that the conceptual designer will build the final detail model, but it does imply that the functionality must be in the system for everyone to use when required. A common data base will allow the ready application of analysis tools to new design as well as production enhancements with a minimum of overhead. This unified approach is necessary to form the core of a corporate resource creating the development and production data base.

FEMlFEA

The extensive use of finite-element modeling and analysis will assure the continued use of this technology. The confidence of working with a time-proven analysis code is strong incentive to continue business as usual. Evolution will occur primarily in the user interface and new application areas, but core analysis processing is expected to change little. New design and analysis codes are expected to make inroads slowly with substantial verification required. New users will be more open to new analytical techniques, but reliable correlation to physical test must be proven.

Kinematics

Kinematic analysis is essential for development of mechanisms in product design. Eventually the assembly process is all that would be required to constrain the motion of the mechanism with full 3-D simulation of part assembly with slop in the joints and just-touching contact. Full analysis with post processing of results is required.

2.6-16 © 1986 Dataquest Incorporated September CCIS Markets

2.6 Mechanical Computer-Aided Engineering (MCAE)

MARKET FORECASTS

This section presents detailed analysis of the 1985 MCAE market, with a forecast through 1990. It is analyzed by product type and region, indicating the hardware and software content of each classification. The hardware and software analysis allows an apples-to-apples comparison in looking at market share ranking of third-party software vendors and turnkey system suppliers. Market share analysis for 1985 is included for the leading MCA£ suppliers.

Overview

The M C / ^ workstation unit CAGR of 48.6 percent is significantly higher than the expected 34.1 percent CAGR of the total mechanical market through 1990. The

1985 to 1986 revenue growth in software for M C / ^ is expected to be more than

18 percent. More than 20 percent of the mechanical workstations were sold primarily as MCAE workstations. This percentage is expected to grow to 35 percent in 1990.

Market Forecast By Product Type

The forecast shown in Table 2.6-3a represents worldwide hardware and software revenue by product type. Table 2.6-3b indicates the percentage distribution of the same data. The 1985 market estimate, product distribution, and forecast to 1990 are based on reported 1985 company revenue and survey data.

Revenue for both bundled and unbundled software products has been considered in the forecast. The units specified are estimated to be the corresponding systems and workstations required to support the expected software revenue. The following should be noted about the market forecast by product type:

• More than 76 percent of the MCAE workstations sold in 1985 were configured with host-based computers. This is expected to drop to less than

12 percent in 1990.

• Standalone-based workstations are the fastest growing product type, expected to grow from a 9 percent share in 1985 to more than 77 percent in 1990.

• Personal computers are expected to provide an important hardware platform for MCAE, representing a peak of 23.4 percent share in 1987.

The level of PC-based MCAE products is expected to fall off after 1987 as the standalone product becomes dominant.

• More than 9 out of 10 software dollars were spent on host-based products in

1985. This is expected to drop dramatically to a 15 percent level in 1990.

• Hardware revenue for host-based products follows the same pattern, dropping from 93 percent in 1985 to more than 27 percent in 1990.

CCIS Markets © 1986 Dataquest Incorporated September 2.6-17

2.6 Mechanical Computer-Aided Engineering (MCAE)

Table 2.6-3a

Worldwide MCAE Market Forecast by Product Type

Hardware and Software Only

(Millions of Dollars and Actual Units)

1985

1986 1987 1988 1989 1990

CAGR

Worldwide

Revenue Total

Software

Hardware

Systems

Workstations

Standalone

Revenue Total

Software

Hardware

Workstations

Host-Dependent

Revenue Total

Software

Hardware

Systems

Workstations

Personal Computer

Revenue Total

Software

Hardware

Workstations

$869

$209

$660

3,729

8,734

$996

$248

$748

7,775

13,456

$1,118

$314

$805

13,666

20,123

$1,271

$410

$%1

22,393

29,393

$1,419

$535

$S84

36,355

42,921

$1,607

$699

$908

57,594

63,276

13.1%

27.4%

6.6%

72.9%

48.6%

$53

$22

$32

806

$127

$52

$75

2,542

$795

$181

$614

1,640

6,645

$821

$183

$638

2,582

8,263

$772

$179

$592

2,604

9,060

$691

$171

$519

2,536

9,536

$523

$141

$382

2,160

8,726

$352

$105

$247

1,696

7,378

$20

$5

$15

1,283

$48

$13

$35

2,651

$265

$111

$154

6,342

$483

$210

$273

13,842

$794

$362

$432

27,489

$1,157

$562

$595

48,797

$81

$23

$58

4,720

$97

$29

$68

6,015

$101

$31

$70

6,706

$98

$32

$66

7,100

84.9%

91.5%

79.8%

127.2%

-15.0%

-10.4%

16.6%

.7%

2.1%

37.4%

42.7%

35.2%

40.8%

Source: DATAQUEST

August 1986

2.6-18

1986 Dataquest Incorporated September

CCIS Markets

2.6 Mechanical Computer-Aided Engineering (MCAE)

Table 2.6-3b

Worldwide MCAE Market Forecast by Product Type

Hardware and Software Only

(Percent of Total)

Standalone

Revenue Total

Software

Hardware

Workstations

Host-Dependent

Revenue Total

Software

Hardware

SysteIns

Workstations

1985

asss=

6.2%

10.5%

4.8%

9.2%

91.5%

86.9%

93.0%

44.0%

76.1%

Personal

CoInputer

Revei-iue Total

Software

Hardware

Workstations

2.3%

2.6%

2.2%

14.7%

1986

=====

12.7%

21.0%

10.0%

18.9%

82.4%

73.6%

85.3%

33.2%

61.4%

4.8%

5.4%

4.7%

19.7%

1987

=====

23.7%

35.5%

19.1%

31.5%

69.0%

57.2%

73.6%

19.1%

45.0%

7.3%

7.3%

7.2%

23.5%

1988

=====

38.0%

51.2%

31.7%

47.1%

1989

=====

56.0%

67.7%

48.9%

64.0%

54.4%

41.8%

60.3%

11.3%

32.4%

7.6%

7.0%

8.0%

20.5%

36.9%

26.4%

43.2%

5.9%

20.3%

7.1%

5.9%

' 7.9%

15.6%

1990

=====

72.0%

80.4%

65.5%

77.1%

21.9%

15.0%

27.2%

2.9%

11.7%

6.1%

4.6%

7.2%

11.2%

Source: DATAQUEST

August 1986

Market Forecast by Region

The forecast shown in Table 2.6-4a represents worldwide hardware and software revenue by region. Table 2.6-4b indicates the percent distribution of the same data. The 1985 market estimate, product distribution, and forecast to

1990 are based on reported 1985 company revenue and survey data. Revenue for both bundled and unbundled software products has been considered in the forecast.

The units specified are estimated to be the corresponding systems and workstations required to support the expected software revenue. The following should be noted about the market forecast by region:

• The majority of MCAE product was sold in North America in 1985, representing more than 59 percent of the product revenue. This corresponds to a 45 percent revenue share for the total mechanical market.

The MCAE market revenue is expected to drop slightly to 58.3 percent in

1990. Roughly half of the M C / ^ workstations sold in 1985 were sold in

North America.

CCIS Markets

1986 Dataquest Incorporated September

2.6-19

2.6 Mechanical Computer-Aided Engineering (MCAE)

• The European region is growing slightly as a percentage of revenue and workstation units installed. Revenue is expected to grow from more than

25 percent in 1985 to 28 percent in 1990.

• The Far East was responsible for approximately 13 percent of product revenue in 1985. This corresponds to a higher unit percentage of roughly

20 percent. The more prevalent low-cost product causes the higher unit percentage.

• The remaining worldwide market has a small 1.5 percent of revenue and unit shipments. This market is keeping up with the growth of MCAE in general, maintaining an expected 1.5 share throughout 1990.

2.6-20 © 1986 Dataquest Incorporated September CCIS Markets

2.6 M e c h a n i c a l Computer-Aided Engineering (MCAE)

Worldwide

ReveIuie T o t a l

Software

Hardware

Systems

Worlcstations

North America

Revenue Total

Software

Hardware

Systems

Workstations

Europe

Revenue Total

Software

Hardware

Systems

Workstations

Far East

Revenue Total

Software

Hardware

Systems

Workstations

Rest of World

Revenue Total

Software

Hardware

Systems

Workstations

Table 2.6-4a

Worldwide M C A E M a r k e t F o r e c a s t b y R e g i o n

Hardware a n d Software Only

(Millions of Dollars a n d Actual Units)

1985

1986 1987 1988 1989

1990

CAGR

$869

$208

$660

3,729

8,734

$996

$248

$748

7,775

13,456

$1,118

$314

$805

13,666

20,123

$1,271

$410

$861

22,393

29,393

$1,419

$535

$884

36,355

42,921

$1,607

$699

$908

57,594

63,276

13.1%

27.4%

6.6%

72.9%

48.6%

$517

$124

$393

2,118

4,352

$225

$54

$171

1,077

2,501

$113

$27

$86

490

1,749

$13

$3

$10

44

132

$592

$148

$445

4,623

6,691

$262

$65

$197

2,046

3,907

$128

$32

$96

1,000

2,668

$14

$3

$10

106

190

$661

$185

$476

8,078

9,936

$302

$85

$217

3,692

5,984

$140

$39

$101

1,717

3,930

$15

$4

$11

180

274

$747

$241

$506

13,170

14,424

$350

$113

$237

6,161

8,888

*157

$51

$106

2,768

5,681

$17

$5

$11

295

400

$830

$313

$517

21,271

20,934

$395

$149

$246

10,111

13,107

$175

$66

$109

4,494

8,296

$19

$7

$12

479

583

$935

$407

'$529

33,525

30,672

$450

$196

$254

16,133

19,450

$199

$87

$113

7,148

12,262

12.6%

26.8%

6.1%

73.7%

47.8%

14.9%

29.4%

8.3%

71.8%

50.7%

11.9%

26.1%

5.5%

70.9%

47.6%

$22

$10

$12

788

892

11.5%

25.6%

5.1%

77.8%

46.6%

Source: DATAQUEST

August 1986

CCIS Markets

1986 Dataquest Incorporated September

2.6-21

2.6 Mechanical Computer-Aided Engineering (MCAE)

Table 2.6-4b

Worldwide MCAE Market Forecast by Region

Hardware and Software Only

(Percent of Total)

1985 1986 1987 1988 1989

1990

North America

Revenue Total

Software

Hardware

Systems

Workstations

Europe

Revenue Total

Software

Hardware

Systems

Workstations

Far East

ReverHje Total

Software

Hardware

Systems

Workstations

Rest of World

Revenue Total

Software

Hardware

Systems

Workstations

59.6%

59.6%

59.6%

56.8%

49.8%

59.5%

59.5%

59.5%

59.5%

49.7%

59.1%

59.1%

59.1%

59.1%

49.4%

58.8%

58.8%

58.8%

58.8%

49.1%

58.5%

58.5%

58.5%

58.5%

48.8%

58.2%

58.2%

58.2%

58.2%

48.5%

25.9%

25.9%

25.9%

28.9%

28.6%

26.3%

26.3%

26.3%

26.3%

29.0%

13.1%

13.1%

13.1%

13.1%

20.0%

1.5%

1.5%

1,5%

1.2%

1.5%

1.4%

1.4%

1.4%

1.4%

1.4%

27.0%

27.0%

27.0%

27.0%

29.n

12.9%

12.9%

12.9%

12.9%

19.8%

12.6%

12.6%

12.6%

12.6%

19.5%

1.3%

1.3%

1.3%

1.3%

1.4%

27.5%

27.5%

27.5%

27.5%

30.2%

27.8%

27.8%

27.8%

27.8%

30.5%

28.0%

28.0%

28.0%

28.0%

30.7%

12.4%

12.4%

12.4%

12.4%

19.3%

1.3%

1.3%

1.3%

1.3%

1.4%

12.4%

12.4%

12.4%

12.4%

19.3%

1.3%

1.3%

1.3%

1.3%

1.4%

12.4%

12.4%

12.4%

12.4%

19.4%

1.4%

1.4%

1.4%

1.4%

1.4%

Source: DATAQUEST

August 1986

2.6-22

1986 Dataquest Incorporated September

CCIS Markets

2.6 Mechanical C o m p u t e r - A i d e d Engineering (IVICAE)

MARKET SHARE ANALYSIS

The estimated mechanical computer-aided engineering market analysis for

1985 is shown in Table 2.6-5 and Figure 2.6-2. The 1985 software-only revenue is used to indicate market share. Hardware and software revenue for turnkey and software-only vendors was considered. The if-sold value of the hardware necessary to support the unbundled software products has been added where necessary to allow reasonable comparison.

Table 2.6-5

Estimated 1985 MCAE Market Share

V e n d o r s

IBM

C o f l i p u t e r v I s i on

M o c N e a l - S c h w e n d i e r *

SORC*

Intergraph

McDonneI I Douglas

Swanson Analysis

PDA Engineering

Prime Computer

AppIi con

Other

Hardware ond

Software

Revenue*

$252.9

105.4

75.9

69.5

55.4

48.5

40.8

31.9

34.9

31 .6

98.9

Software-

Only

Revenue

$ 57.8

25.4

21.0

21 .0

12.6

11.1

10.1

8.8

7.9

7.8

25.0

Marl<et

Share

27.7%

1 2 . 2

1 0 . 1

1 0 . 1

6 . 1

5 . 3

4.8

4 . 2

3 . 8

3 . 7

1 2 . 0

Total

$845.7 $208.5

1 0 0 . 0 %

•The if-sold value for hardware to support the unbundled software products has been added where necessary for comparison purposes. Market share percentages are calculated based on software-only revenue.

Source; Dataquest

August 19S6

CCIS Markets 1986 Dataquest Incorporated September

2.6-23

1.6 Mechanical Computer-Aided Engineering (MCAE)

Figure 2.6-2

Estimated 1985 MCAE Market Share

Computervlslon

12.2%

MacNeal-Schwendler

1 0 . 1 %

' " t f g r a p h X / / \ V ^ Appllcon Inc.

6-i% >='~-X___L-t-^\. ^•''°''°

McDonnell Douglas '"'^ ^~~] A Prime Computer

5.3% I ^ 3.8%

Swanson Analysis PDA Engineering

4 . 8 % 4 . 2 %

Source: Dataquest

August 1986

DATAQUEST ANALYSIS

Market

MCAE is a key element in the evolution of CAD/CAM. MCAE is growing, upgrading the complete design and analysis process including conceptual design, detail product design, and manufacturing engineering design. Users at all levels will benefit by having access to efficient tools for the dedicated or casual user.

In the short term, the benefits of MCAE are derived from the close integration of design and analysis applications. Full integration of MCAE into the mainstream of corporate decision making is a long-term issue essential in gaining the full benefit of design automation technology.

2.6-24 © 1986 Dataquest Incorporated September CCIS Markets

2.6 Mechanical Computer-Aided Engineering (MCAE)

P r o d u c t

The total range of process and display advancements, from personal computers to supercomputers, are being utilized. Also used are all types of display hardware. from monocolor low-resolution to high-resolution, full color, real-time dynamic display. Dataquest believes that the basic requirement to solve more complex design and analysis problems will continue to drive product offerings toward higher-performance packages.

Solid modeling is emerging as the primary modeling tool in MCAE, with 2-D and 3-D wireframe supporting the effort. Finite-element modeling and analysis is expected to remain an important technology in MCAE throughout the foreseeable future. Analytical tools are being applied to a growing list of applications, increasing the value and utility for a larger audience.

Vendor

The 54 percent MCAE market growth estimate in workstation units in 1986 is significantly greater than the expected 32 percent growth of the mechanical market in general. All major CAD/CAM vendors are contributing with current product offerings. The 1985 market share analysis shows the turnkey vendors nearly splitting the market with software-only vendors. The top ten mechanical CAD/CAM vendors must offer highly functional MCAE products to remain in the club of market leaders.

CCIS Markets © 1986 Dataquest Incorporated September 2.6-25

2.6 Mechanical Computer-Aided Engineering (MCAE)

(Page intentionally left blank)

2.6-26 © 1986 Dataquest Incorporated September CCIS Markets

tC Appilcationt

3.1 AEC Definitions

The Architecture, Engineering, and Construction (AEC) segment comprises

CAD products that are used in the design (prebuild) and management (postbuild) phases of a facility project. CAD is typically not used during the building phase of a project, although its use in the design phase can have a direct impact on how productive the construction of a facility will be; significant cost and time savings have been reported during the building phase as a result of using CAD in project design. The most common form of output from a CAD system would be drawings of a facility yet to be built, or a facility being managed.

Figure 3.1-1 shows Dataquest's view of this segment, which takes into account major end-user markets as well as the tasks associated with both the design or management phase of a facility project.

Figure 3.1-1

The AEC Segment

Analysis

Design/Model

Data Management

Drafting/Documentation

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

3.1-1

3.1 AEC Definitions

FACILITY

The standard (Webster's) definition for facility reads, "...something that is built, installed, or established to serve a particular purpose." Engineering News

Record (ENR) uses several specific categories of facility projects as a barometer to measure the health of the design and construction industries from one year to the next. Table 3.1-1 lists those categories of facilities.

Table 3.1-1

Facility Project Categories

Category Description

Water Supply Dams, Canels, Locks, River Channels

Power Electric/Gas Utility Plants

Manufacturing All Kinds of Plants (i.e., Process/Discrete)

Building Residential/Commercial (Offices, Shopping

Centers, Hospitals, etc.)

Sewer, Waste As Stated

Transportation Roads, Highways, Bridges, Railroads, etc.

Pipehne Oil/Gas (including Natural Gas)

Other Offshore Drilling Platforms, Ships (and other ocean-going vessels), etc.

Source: ENR Magazine

Dataquest

June 1986

MAJOR MARKETS

As shown in Figure 3.1-1, the AEC CAD markets are very diverse. And the engineering professionals and technicians working in these industries are from a variety of disciplines, making for even greater levels of complexity. Regardless of these diversities, however, a facility (and the design, construction, or managing of it) is always the focal point of these markets and the professionals working within them.

The type of facility that is being designed, built, or managed dictates what type of firm(s) and engineering professional(s) are required for project execution. In many cases, companies or utilities have in-house design or construction crews.

However, Dataquest believes that the majority of facility projects are executed by independent design or construction firms.

3-1-2 © 1986 Dataquest Incorporated July CCIS Markets

3.1 AEC Definitions

Table 3.1-2 lists the various types of professionals that could at some point be involved in a facility project and have use for CAD systems.

Table 3.1-2

Classification of Professionals

Architect

Civil/Structural Engineer

Civil/Site Engineer

Mechanical Engineer

Surveyor

Electrical Engineer

Industrial Engineer

Chemical Engineer

Piping Engineer

Petroleum Engineer

Nuclear Engineer

Marine Engineer/Naval Architect

Related Technicians (i.e., Designers/Draftspersons)

Facility Manager

Source: U.S. Census of Population

Dataquest

June 1986

TASKS

The tasks of design, analysis, documentation, and data management take on various meanings based again on the facility being designed or managed, as well as the professionals involved. For instance, in the case of an architect working on a commercial office building project, design usually means the creative and asthetic aspects of that project (i.e., the most visual aspects of the proposed structure). To an engineer, design may represent the creative aspects of his work as well.

However, on a day-to-day basis it also represents the cranking out of calculations in some form to complete the "design" (i.e., the structural, mechanical, and electrical aspects of the building).

There are numerous programs and special CAD system functionalities that are related to the AEC application segment. Many of them are listed below, including:

• Geometric construction and • Space projections editing

Stacking/blocking routines

Planning/layout

Equipment/inventory management

Elevations

Structural grid/column layouts

Massing studies

CCIS Markets © 1986 Dataquest Incorporated July 3.1-3

3.1 AEC Definitions

Interference checking

Steel detailing

Piping/plumbing design

P & IDs

Stress calculations (analysis)

HVAC design

Electrical schematics

Isometric views

Perspective views

Wireframe modeling

Control diagrams

Sectioned views

Solid modeling

FEM/FEA

On-line graphics programming

Report generation

Bill of Materials generation

Given the depth and complexity of the AEC segment (as demonstrated by the breakouts of our model), it is beyond the scope of this section to further define what each of the different types of facility projects would require in terms of CAD system functionality. There are distinct CAD differences from one project to another and in both the prebuild phase and the postbuild phase (termed facility management).

Dataquest will address the CAD requirements for the different types of facility projects in future writings, as part of this AEC chapter.

3.1-4 1986 Dataquest Incorporated July

CCIS Markets

3.2 AEC Executive Summary

This summary highlights the key points and analyses discussed throughout this chapter. Please refer to the chapter in its entirety for a comprehensive analysis of the AEC application segment.

AEC CAD/CAM revenue was $746 million in 1985; it is forecast to grow to

$896 million in 1986 and to $1,876 million in 1990.

• DATAQUEST expects the AEC CAD/C/yVl market to grow in revenue at

21 percent compounded annually for the next five years.

• The total number of CAD/CAM workstation units shipped in 1985 was

18,514; Dataquest forecasts 20,712 in 1986 and 42,525 in 1990.

• Major hurdles have been crossed that were once blocking widespread use of AEC CAD tools, i.e., price/performance ratio of hardware tools, display performance, availability of software, and ease of use.

• As the price of hardware continues to drop, more users will continue to look toward CAD as a replacement for manual design methods.

• The effect of the personal computer has been dramatic. More than

70 percent of the workstations sold in 1985 were based on PCs.

• Data base management capability will be a crucial factor in the future of facility design and management.

• Future systems will allow fast- or slow-motion data base manipulation with a time-base reference available to provide accurate simulation of changes in the model as a function of time. This will result in realistic simulation of a wide variety of operations, which will be useful in many facility projects.

Mergers and acquisitions can be valuable shortcuts toward improving the relative position of a vendor's total offering. Careful analysis of the many opportunities can avoid a costly or catastrophic detour.

CCIS Markets © 1986 Dataquest Incorporated July 3.2-1

3.3 AEC Market Overview

AEC HISTORY

Until 1983, the AEC segment had been affected by several key factors. These included:

• Dominance of the segment by only four CAD vendors

• CAD system usage limited mostly to 2-D drafting applications

• Expensive and often limiting computing/graphics hardware

The handful of vendors dominating the AEC segment included Applicon,

Auto-trol, Computervision, and Intergraph. A turnkey, host-dependent system approach prevailed, and Digital Equipment's PDP-11 and VAX computers were featured in the CAD systems of all the vendors (except Computervision). For this reason, we believe that Digital Equipment hardware had been the dominant computing platform in this CAD segment.

In 1982, Auto-trol made history by positioning itself as the first AEC vendor to offer standalone computing capability. The company announced that it would offer its AEC products on Apollo Computer's first standalone product. Late in 1983,

Calma also announced its support of Apollo's workstation products.

Table 3.3-1 shows Dataquest's estimates of the installed base of AEC workstations for each of the vendor companies as of year-end 1983 (and the combined totals of all these companies) compared with the total AEC installed base. We estimate that the workstation installed base of these four vendors represented 81 percent of the total AEC installed base at year-end 1983.

Table 3.3-1

Year-End 1983 Estimates

Worldwide AEC Workstation Installed Base

(Thousands of Units)

Year-End 1983

Company Installed Base

Applicon 1,030

Auto-trol 1,187

Computervision 1,573

Intergraph 2,495

Total 6,285

Total Installed Base 7,800

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July 3.3-1

3.3 AEC Market Overview

CAD vendors until now have capitalized on architects' and engineers' needs to generate enormous quantities of detailed construction drawings by offering systems to automate this stage of a project (labeled the drafting/documentation stage).

However, a design process usually starts long before it reaches a draftsperson's table. Prior to this point, the project architect and/or engineer has already spent many hours huddled over hand-drawn sketches or plastic miniature-size models, conceptualizing a proposed facility. The drawings that emerge from this stage are usually called concept drawings or (architectural) renderings. There has been much disagreement (in both the vendor and AEC user communities) surrounding the need for a system with anything more than drafting functionality. We believe though that most users have not been able or ready, for a number of reasons, to tackle the challenge of implementing full-scale (concept design to design documentation) systems. The reasons for this can be identified as hardware, hardware, and hardware; most users in the AEC community were not in a position to invest in the computing horsepower needed to drive full-scale design systems.

Niche Approaches

Eventually, the absence of design and analysis solutions from the major turnkey vendors cleared the way for the AEC niche market vendors. The solutions introduced by this group were much more complex and were usually sold on a third-party basis. One of the best-known and most-used solutions is STRUDL, a

Structural program that is used to calculate the effects of stress on a given

Structure. In addition, many other programs have been developed for the mechanical, electrical, and civil/site disciplines to solve the complex calculations involved in those aspects of facility design.

Drafting Revisited

Dataquest believes that the entry of personal computer-based CAD solutions forever changed the AEC world. The revolution began in 1984, when one product,

AutoCAD from AutoDesk, took the CAD world by storm; we estimate it shipped in excess of 5,000 packages that year.

AutoCAD was quickly adopted by many professionals in this application segment, bringing the focus back again to the world of drafting and away from full-scale design systems. A survey conducted by AutoCAD of its installed base in early 1986 revealed that half of all disciplines using AutoCAD fall into the AEC classification.

The ability of personal computer-based systems to serve this drawing-intensive application segment has been disputed since the introduction of the first system in

1978. (T & W Systems was actually the first to offer this type of approach.) But it was a short-lived dispute, as more and more functionality (particularly in hardware) was added to this product platform. Between 1984 and 1986, Dataquest believes that nearly 100 software solutions were made available to the AEC segment, for

3.3-2 © 1986 Dataquest Incorporated July CCIS Markets

3.3 AEC Market Overview use on the personal computer. We also believe that a majority of them have been developed as "piggyback" solutions for the AutoCAD program. And several of these solutions brought the issues of design and analysis back into the spotlight.

Major Turnkey Vendors' Dominance Wanes in 1984

To be sure, the market for AEC CAD systems expanded in 1984, with the availability of low-cost solutions. This marked a major shift in the overall installed base of workstations. As shown in Table 3.3-2, the four vendors that together had dominated the AEC segment through 1983 represented only 37 percent of the total installed base after 1984. Dataquest estimates that 9,530 personal computer workstations were shipped during 1984, which represented 72 percent of the total workstations shipped that year to the AEC segment.

Table 3.3-2

Year-End 1984 Estimates

Worldwide AEC Workstation Installed Base

(Thousands of Units)

Company

Appllcon

Auto-trol

Computervision

Intergraph

Total

Total Installed Base

Year-End 1984

Installed Base

1,176

1,349

1,696

, 3,379

7,600

20,784

Year-End 1983

Installed Base

1,030

1,187

1,573

2,495

6,285

7.800

Source: Dataquest

June 1986

As 1984 was reaching a close and 1985 approaching, many of the traditional

CAD vendors (as well as new CAD vendors) were either initiating or implementing low-cost system strategies to address a larger available market. The writing was on the wall in 1984. It read:

LOW-COST SOLUTIONS MEAN MANY MORE BUYERS

We believe that this statement has never been truer than in the AEC segment, where an estimated 80 percent of design firms have 10 or fewer persons working in them.

CCIS Markets © 1986 Dataquest Incorporated July 3.3-3

3.3 AEC Market Overview

CURRENT ENVIRONMENT

Aside from the low-cost issue and all that it entails (e.g., distribution channel decisions) there are currently additional market- and product-related considerations for CAD vendors that participate in the AEC segment. Some of the major considerations include:

• Having flexible enough product offerings to ride out the constant shifts in user requirements

• Interchange standards

• Data base management

• Furthering progress on interfaces for drawing and engineering functions

Shifts in User Requirements

Engineering News Record reports regularly on the changing scene of construction planning. One message that is heard consistently throughout the industry concerns the office/commercial building market; ENR observers predict a drastic decline in the next several years in new construction plans (1986 plans are forecast to increase only two percent). On the more positive side, infrastructure (i.e., roads, highways, bridges) construction plans are booming across the United States and around the world.

With most oil-related and nuclear projects in a holding pattern, design and/or construction firms that depended on this kind of work are scrambling to stay afloat, and in many cases are reorganizing to address the opportunities that exist in other project sectors.

The above situations are examples of the dynamics of the facility design and construction industry. CAD vendors that are wary of these dynamics are reaping the rewards, for as stated earlier, the type of CAD products needed for project design differ according to the type of facility being built. Those whose products are tied to any one particular need are probably riding the same choppy wave that affects the users' livelihood. At this stage, many design firms are experiencing the effects of instability in different project segments.

Interchange Standards

As the number of AEC CAD users grows, the problem of architects, engineers, and general contractors all working on the same project with different CAD systems becomes more apparent. Dataquest believes that although specific interfaces have been developed between the traditional vendors' CAD systems, the need for a

Standard exchange specification with translators to each system has never been

3.3-4 © 1986 Dataquest Incorporated July CCIS Markets

3.3 AEC Market Overview greater. The mechanical CAD segment cannot function without such a standard; the automobile and aerospace manufacturers are examples of this fact.

The AEC subcommittee of the Initial Graphics Exchange Specification (IGES) has been working toward developing future versions of IGES to serve AEC needs better. Dataquest believes that a common graphics exchange standard for AEC users is essential if CAD is to provide not just automated drafting but design coordination within a firm and between firms. We believe at this stage that such a

Standard is imminent, quite possibly with the release of Version 3.0 of IGES.

User groups are also set up to test the standard as it is upgraded over the next year. Hellmuth, Obata, and Kassabaum (HOK), an architectural firm in St. Louis, has produced an IGES test drawing for a building that will help to test whether the claims of a vendor in conforming to IGES are realistic. (An interesting note—HOK released its first architectural system in 1985, composed of proprietary software and Digital Equipment hardware.)

Data Base Management

In light of the multidisciplinary nature of the AEC segment, it is not surprising to find a similar scenario to what exists in the mechanical segment—usually termed

"islands of automation." Many of the CAD products available today solve only one particular piece of the total facility design puzzle.

As many CAD vendors have acknowledged, data base management capability is another critical factor in the growth of the AEC segment, falling directly in line with IGES capability to effectively merge these automation islands. Once the systems compatibility issue is solved via interchange standards, the flow of information must be transferred, controlled, and maintained. Almost without exception, a user's data base represents its most valuable investment in CAD. This is becoming increasingly more evident, since it would contribute greatly to a user's ability to manage a facility after construction. In this capacity, its most vital role would be to provide a user with quick and ready access to accurate and up-to-date information about the facility.

Data base management capabilities have become more sophisticated, providing capabilities to generate bills of materials and other comprehensive reports from the project data base to support related design, purchasing, and construction activities.

Demands for such data base management features as change management and notification, access control (particularly important for distributed workstation-based systems), and drawing archiving, have been met with limited success.

Drawing/Engineering Interfaces

Increasingly sophisticated hardware technology, especially in the graphics area, has boosted the efforts behind interfacing the engineering (design/analysis) aspects

CCIS Markets © 1986 Dataquest Incorporated July 3.3-5

3.3 AEC Market Overview of a facility project with the drawing (drafting) aspects. This is perhaps one of the most crucial issues in the world of AEC, and again, is closely related to the interchange standards issue. Software vendors and turnkey system suppliers are working to fill the gaps and to interface accepted engineering programs and methods to drafting systems.

MARKET OPPOBTUNTriES

Each of the issues discussed in the previous section on current environment focused on system functionality and the opportunities that existed for improvement.

The overall consensus could be that the most successful CAD vendors in the AEC segment will provide well-integrated application software. Not only would it be well integrated, but it would run on a wide range of computing hardware. These

Statements are both true in general, but they fail to identify where some of the market opportunities exist and how they are related.

Facility Management

Facility management can be labeled both a market niche and an application within the AEC segment. Henceforth, it will be treated and defined as both.

Dataquest believes that facility management will be one of the faslsst-growing

AEC markets during the remainder of the 1980s. A forthcoming report detailing this market/application segment will describe this growth in greater detail.

As a CAD application, it requires the principles of design or drawing that would best suit the facility being managed. Oftentimes, the issues concern space allocation as it would occur in an office or manufacturing envirofflment. Given these two examples, the end user might be an architect or industrial engineer.

CAD is really only one part of the overall picture in a facility management environment. A host of other application-specific functions are necessary in most cases. And most of them rely on the presence of data base management systems to be implemented successfully.

We believe that hardware preferences will vary according to the size of an organization and often according to how facility management is viewed. For example, if it is viewed as an integral part of a large corporation (in excess of

500,000 square feet), the implementation would most likely center on a centralized computing approacii (i.e., mini or mainframe computers). Vendors choosing a

Strategy of targeting this size of facility management customers will want to be prepared to offer this type of solution.

Dataquest believes that personal computer-based solutions will be considered viable alternatives in companies with 500,000 square feet or less.

3.3-6 © 1986 Dataquest Incorporated July CCIS Markets

3.3 AEC Market Overview

Design/Construction Firms

This market category relates back to Dataquest's AEC model shown in the definition section of this chapter. There are many firms that fall under this heading, which makes for a highly competitive situation. In an effort to diversify, many of them are moving into new project-related work. The two most visible shifts have been toward providing construction management or materials procurement for construction. These highly information-intensive applications often require larger computer capacity. Many vendors are positioning themselves to address this emerging market opportunity.

CCIS Markets © 1986 Dataquest Incorporated July 3.3-7

3.4.1 Total AEC CAD/CAM

This section covers the total architectural, engineering and construction (AEC)

CAD/CAM market for all regions and product types and refers to

Figures 3.4.1-1 Revenue and 3.4.1-1 Shipments and Table 3.4.1-1.

• The AEC segment reached an estimated $746 million in 1985 and is forecast to grow to $1,876 million in 1990, at a compound annual growth rate (CAGR) of 21 percent.

• Dataquest estimates that revenue will increase 21 percent in 1986, reaching

$896 million.

• Workstation shipments in 1985 were an estimated 18,514 units; shipments are expected to reach 42,525 units in 1990, growing at an 18 percent

CAGR.

CCIS Markets © 1986 Dataquest Incorporated July 3.4.1-1

3.4.1 Total AEC CAD/CAM

Figure 3.4.1-1 Revenue

AEC CAD/CAM-Worldwide

Millions of Dollars

2000-

1600-

1600

1400

1200

1000

800

600-

400

200

^

%^^ r s ^ ^

J ^

'v'

tsJ

^ ^

\ W %

:K t^-g

v V

i X ' v

%V:

1985

;% k<

1986

k^

[S!^^S:^ x^

s

1987

F^^^S

1988

wSS

;'v\x>

Vr.

"O _ "J'' ^

- . L "^/ •'4 1

1990

Source: Data<juest

June 1986

3.4.1-2 1986 Dataquest Incorporated July

CCIS Markets

3.4.1 Total AEC CAD/CAM

Figure 3.4.1-1 Shipments

AEC C A D / C A M - W o r l d w i d e

Workstation Shipments

45000-

40000

35000

30000

25000

20000

15000

10000

5000

V;, ^J,, -Lr, fi

•A

'n,

%. %

S ^

ssss:'

S ^

i t ^ ^ vKVC^

w$

•$^k$

'^^^^

^;\:\;v^

•", - 1 , - V " 1 ; .

^ ^

> i % . -'.J. \ %

%s.s%%

'^X'^-W

S:<ss

1985

t-^^j^^

1986

iSSS^- •

VV'.'XX,

'^s^x^

X V V %?•!

^ ^

% , =0. -?J, \ r^t,

>

< ; ^ ^ ^

KMa

• - v ^ , . . ' = , • % . %

It

1987

1988

fMx-'''-^

^ ^

S'V%,'%' ---

' / . V^ V ^ • - . ;

^ ^

•VC'^'.V

XX\'%N

1990

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

3.4.1-3

3.4.1 Total AEC CAD/CAM

Table 3.4.1-1

AEC CAD/CAM-Worldwide

Total Applications

(Millions of Dollars/Actual Units)

1985 1986 1987 1988 1989 1990 CAGR

T o t a l Narlcet

Revenue 746 8 9 6 1 , 0 7 5 1 , 2 9 6 1 , 5 5 9 1,876 2 0 . 2 X

Systems 1 5 , 4 6 6 16,977 20,774 25,352 30.933 37,096 19.1X

Workstations 18,514 20,712 25,201 30,486 36,465 42,525 1 8 . I X

Source: Dataquest

June 1986

3-4-1-4 © 1986 Dataquest Incorporated July CCIS Markets

3.4.2 AEC Market Shares

This section includes Dataquest's forecasts and analysis of the AEC market share distribution and refers to Figure 3.4.2-1 and Table 3.4.2-1.

• Intergraph Corporation continued to dominate this application area in 1985, with a 27 percent share of total market sales.

• Dataquest attributes Intergraph's dominance in this market during the past few years to several factors:

— Early entry into the marketplace

— Products that serve a wide range of AEC applications

— Continuous expansion of its product line

— Multifunctional systems (mapping is another strong key offering—an application that is closely tied to AEC)

• Despite a substantial growth in revenue during 1985 (approximately

20 percent), Intergraph's relative market share position became diluted as more vendors were added to the AEC roster of companies.

• Computervision held on strong to its second-place ranking in AEC, despite a shaky year for the company overall.

• After the second-place ranking, the picture resembles somewhat a dogfight—with Holguin-CAD leading in the third-place position.

• Holguin received a boost in 1985 with the addition of BruningCAD to its camp; the acquisition of BruningCAD, combined with its own AEC business, catapulted Holguin to a third-place ranking.

• Most of the Other large, traditional turnkey CAD companies experienced

Strong growth in this segment in 1985; IBM was boosted to a fifth-place ranking with an estimated 300 percent growth over 1984 revenue, reaching

$35 million in new AEC system sales.

CCIS Markets © 1986 Dataquest Incorporated July . 3.4.2-1

3.4.2 AEC M a r k e t Shares

Figure 3.4.2-1

AEC M a r k e t Share—Worldwide

1985

Source: Dataquest

June 1986

3.4.2-2

1986 Dataquest Incorporated July

CCIS Markets

Table 3.4.2-1

AEC Market Share—Worldwide

(Millions of Dollars)

3.4.2 AEC Market Shares

COMPANY

1985

REVENUE

1985

SHARE

Intergraph

Computervision

Holgufn-CAD

Calma

IBM

Calccxnp

Auto-Trot

McAuto

Prime

Applicon

Autodesk

Hewlett-Packard

Control Data

SDRC

MacNeal Schuendler

Ferranti

Matra Datavision

Other Computer Companies

Other Europe

CoIiIpanies

Other Far East Companies

Other Turnkey and Software

All Companies

28

23

14

10

63

32

77

32

746

5

2

1

1

1

204

49

38

37

35

33

33

31

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

27.4%

6.5%

5.0%

4.9%

4.7%

4.4%

4.4%

4.1%

3.8%

3.1%

1.9%

1.3%

.6%

.2%

.1%

.1%

.1%

8.5%

4.3%

10.3%

4.2%

100.0%

Source:

Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

3.4.2-3

3.4.3 AEC Regions

This section includes Dataquest's forecasts and analysis of the AEC market, segmented by region and refers to Figures 3.4.3-1 Revenue and 3.4.3-1 Shipments and Tables 3.4.3-1 and 3.4.3-2.

• We expect the estimated 21 percent CAGR in revenue between 1985 and

1990 to be evenly distributed over the four major market segments.

Dataquest expects the European sector to make a very slight gain in share of total market.

• The North American section is forecast to maintain its lead in consumption of CAD, representing 63 percent of revenue worldwide.

• The emerging countries will have an early interest in AEC CAD/CAM tools in comparison with the other regional sectors because of the high level of building, construction, and large commercial development projects that are typical in that environment.

• The CAD products developed in Europe and Japan are expected to gain a growing percentage of the U.S. market share. U.S.-based vendors will require a concerted effort and strategic alliances with local distributors to maintain a significant market share. Dataquest believes that the next two years will provide the largest window of opportunity to gain market recognition and share.

CCIS Markets © 1986 Dataquest Incorporated July 3.4.3-1

3.4.3 AEC Regions

Millions of Dollars

1200-

North A m e r i c a

Europe

1000

A

X

Far East

ROW

Figure 3.4.3-1 Revenue

AEC CAD/CAM By Region

800-

600

400-

2t>0

1985 1986 19S7 1988 1989 1990

Source: Dataquest

June 1986

3.4.3-2

© 1986 Dataquest Incorporated July CCIS Markets

3.4.3 AEC Regions

Workstation Shipments

30000 -

27000-

24000

X

North America

Europe

Far East

ROW

21000

18000

15000

12000-

9000

6000

3000

Figure 3.4.3-1 Shipments

AEC CAD/CAM By Region

1985 1986

1987 1988 1983 1990

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

3.4.3-3

3.4.3 AEC Regions

T a b l e 3.4.3-1

AEC CAD/CAM By Region

(Millions of Dollars/Actual Units)

1985 1986

1987

1988 1989

1990

CAGR

Total Harket

Revenue

Systems

Workstations

746

15,466

18,514

896

16,977

20,712

1,075

20,774

25,201

1,296

25,352

30,486

1,559

30,933

36,465

1,876

37,096

42,525

20.2X

19.1%

18.1X

North America

Reventw

Systems

Workstations

469

9,208

10,961

563

9,901

12,126

675

12,146

14,897

814

15,164

18,399

979

19,028

22,581

1,178

23,201

26,870

20.2X

20.3X

19.6%

Europe

Revenue

Systems

Workstations

144

4,475

5,063

173

4,067

4,776

208

4,834

5,734

250

5,670

6,744

301

6,679

7,791

363

7,769

8,702

20.3X

11.7X

11.4X

Far East

Revenue

Systems

Workstations

109

1,403

1,995

131

2,579

3.242

157

3,248

3,845

189

3,811

4,425

228

4,323

4,958

275

5,003

5,598

20.3X

29.0X

2 2 . »

Rest of World

Revenue

Systems

Itorkstations

24

380

495

29

430

569

35

546

724

42

707

918

51

903

1,136

61

1,T24

1,355

20.2X

24.2X

22.3X

Source:

DatK|uest

June 1986

3.4.3-4

1986 Dataquest Incorporated July

CCIS Markets

3.4.3 AEC Regions

Table 3.4.3-2

AEC CAD/CAM By Region

(Percent of Total)

1985

1986

1987 1988 1989 1990

North America

Revenue

Systems

Workstations

Europe

Revenue

Systems

Workstations

Far East

Revenue

Systems

Workstations

Rest of World

Revenue

Systems

Workstations

63X

60%

59%

63X

58X

59X

63X

58X

59X

63X

60X

60X

63X

62X

62X

63X

63X

63X

19X

29X

Z7X

15X

9X

11X

3X

2X

3X

19X

24X

23X

15X

15X

16X

3X

3X

3X

19X

23X

23X

15X

16X

15X

3X

3X

3X

19X

22X

22X

15X

15X

15X

3X

3X

3X

19X

22X

21X

15X

14X

14X

3X

3X

3X

19X

21X

20X

15X

13X

13X

3X

3X

3X

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

3.4.3-5

3.4.4 AEC Product Types

This section includes Dataquest's forecasts and analysis of the AEC CAD/CAM market segmented by product type and refers to Figures 3.4.4-1 Revenue and

3.4.4-2 Shipments and Tables 3.4.4-1 and 3.4.4-2.

• The compound annual growth rate (CAGR) in revenue from 1985 to

1990 is forecast to be 20 percent.

• Personal computer-based system shipments dominated in 1985, accounting for an estimated 83 percent of total system shipments.

• Although personal computer-based solutions will continue to be viewed as viable CAD options, we believe that the emphasis will shift steadily to a higher-performance 32-bit workstation solution (particularly as price erosion continues to occur).

• With the average system cost dropping, a larger increase in workstation shipments is projected. The 1985 to 1990 CAGR is estimated at

18 percent.

• In 1985, workstation shipments totaled 18,512 units. They are expected to grow to an estimated 42,525 in 1990, an 18 percent CAGR.

• Systems with distributed architectures are forecast to represent 85 percent of the total market in 1990 by workstation volume and 79 percent by revenue.

CCIS Markets © 1986 Dataquest Incorporated July 3.4.4-1

3.4.4 A E C P r o d u c t T y i ^ s

Figune 3.4.4-1 R e v e n a e

AEC CAD/CAM by P r o d u c t Type—Worldwide

Mffflons of Cellars

1200-

Standalone

Host'Oependent

Personal Computer

1000-

/ 1

y 1

800-

/

600-

^

• 1

400-

^ A ^^

MO-

.

0 -

19S5

4

19S6

r

1987

1988

\

1969 1990

Source: .Dalaqiiul

ZAA-1

© 1986 Dataquest Incor|xjrated July

CCIS Markets

3.4.4 AEC Product Types

Figure 3.4.4-1 Shipments

AEC CAD/CAM by Product Type—Worldwide

Workstation Shipments

18000-

16000-

14000-

12000-

i

I —

10000-

8000-

6 0 0 0 -

4000 4

Standalone

Host-Dependent

Personal Computer

20001

0 -

1985

A[— /

_——-"^— /

_ - • — '

1 1

1 1

1986 1987 1988 1989 1990

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

3.4.4-3

3.4.4 AEC P r o d u c t Types

Table 3,4.4-1

AEC C A D / C A M - W o r l d w i d e

Application by P r o d u c t Type

(Millions of Dollars/Actual Units)

1985 ssss

1986

====

1987

S S S S

1988

rsss

1989

====

1990

ssss

CAGR

====

Total Market

Revenue

Systems

Workstations

Standalone

ReverKie

Systeois

Workstations

746

15,466

18,514

896

16,977

20,712

1.075

20.774

25.201

1,296

25,352

30,486

1.559

30.933

36.465

1,876

37,096

42,525

20.2X

19.IX

18.IX

163

1.674

1,674

261

2,881

2.881

416

5.065

5,065

620

8,277

8,277

891

12.911

12.911

1,255

19,456

19,456

50.4X

63.3X

63.3X

Host-Dependent

Revenue

Systems

Workstations

470

880

3,928

501

1,002

4.738

500

1,115

5.542

491

1,199

6,333

457

1.183

6,715

401

1,040

6,469

-3.IX

3.4X

10.5X

Personal Computer

Revenue

Systems

Workstations

113

12,912

12,912

133

13.093

13.093

158

14,594

14,594

185

15,875

15.875

210

16,839

16,839

221

16,600

16,600

14.4X

5.2X

5.2X

SOURCE: Dataquest

June 1986

3.4.4-4

1986 Dataquest Incorporated July

CCIS Markets

Table 3.4.4-2

AEC C A D / C A M - W o r l d w i d e

Application by P r o d u c t Type

(Percent of Total)

3.4.4 AEC P r o d u c t Types

1985

1986 1987

1988 1989 1990

Standalone

Revenue

Systems

Worlcstations

Host-Dependent

Revenue

Systems

Workstations

Personal Computer

Revenue

Systems

Workstations

22X

11X

9X

29X

17X

UX

39X

24X

20X

48X

33X

27X

57X

42X

35X

67X

52X

46X

63X

6X

21X

15X

83X

70X

56X

6X

23X

15X

77%

63X

47X

SX

22X

15X

70X

58X

38X

5X

21X

UX

63X

52X

29X

4X

18X

13X

54X

46X

21X

3X

15X

12X

45X

39X

SOURCE: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

3.4.4-5

3.4.5 AEC Turnkey Average Prices

This section includes Dataquest's forecasts and analysis of the average price per seat by product type for the AEC turnkey segment and refers to

Figure 3.4.5-1 and Table 3.4.5-1.

• Dataquest believes that the average price per seat for AEC will decrease from $58,400 in 1985 to $34,900 in 1990, which represents a negative

10 percent CAGR.

• Host-dependent systems in general continue to offer greater capacity to run more engineering-intensive applications, which accounts for the highest average price per seat in 1985.

• By 1990, the average price per seat of standalone systems will exceed that of host-dependent systems by approximately $800 per seat, at $44,900.

CCIS Markets © 1986 Dataquest Incorporated July 3.4.5-1

3.4.5 AEC T u r n k e y Average Prices

Figure 3.4.5-1

AEC Turnkey—Worldwide

Average Price p e r Seat

Thousands of Dollars

100

• Standalone

• Host-Dependent

A Personal Computer

40

lOih'

0-

•mas

-A

1986

1987

1988

1989 1990

Source: Dataquest

June 1986

3.4.5-2

1986 Dataquest Incorporated July

CCIS Markets

#

3.4.5 AEC Turnkey Average Prices

Table 3.4.5-1

AEC Turnkey—Worldwide

Average Price per Seat

(Thousands of Dollars)

All Product Types

Standalone

Host-Dependent

Personal

ConIputer

1985 1986 1987 1988 1989 1990 CAGR

58.4

73.3

105.8

20.0

53.2

68.4

92.8

18.8

47.2

61.6

77.1

17.9

42.3

55.4

64.0

16.8

38.1

49.9

53.1

15.6

34.9 -10%

44.9 -9%

44.1 -16%

14.4 -6%

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July 3.4.5-3

3.4.6 AEC Revenue Source

This section includes Dataquest's forecasts and analysis of the AEC market segmented by revenue source for each product type. The data are presented in

Figure 3.4.6-1 and Tables 3.4.6-1 and 3.4.6-2.

• Dataquest estimates that hardware represented 66 percent of total revenue in 1985; we estimate this portion of revenue will decrease through 1990 to represent 56 percent in that year.

• Software revenue is estimated to increase (as a portion of total revenue) from 22 percent of revenue in 1985 to 27 percent of revenue in 1990, representing a 26 percent CAGR.

• Revenue from service is also estimated to increase as a percent of revenue through 1990; in 1985 service represented 13 percent of revenue, and in

1990 service is estimated at 17 percent of AEC revenue.

CCIS Markets © 1986 Dataquest Incorporated July 3.4.6-1

3.4.6 AEC Revenue Source

Millions of Dollars

100Q

• Hardware

• Software

A Service

m>

Figure 3.4.6-1

AEC CAD/CAM-Worldwide

Applications by Revenue Source

400

200

04

1985

1986 1987 1S88 1999 1990

Source: Dataquest

June 1986

3.4.6-2 1986 Dataquest Incorporated July CCIS Markets

A l l Product Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Cocnputer

Hardware

Software

Service

Total

Table 3.4.6-1

AEC CAD/CAM-Worldwide

Applications by Revenue Source

(Millions of Dollars)

3.4.6 AEC Revenue Source

1985

1986 1987

1988

1989 1990

CAGR

490

162

93

746

600

183

112

896

702

236

137

1,075

817

306

173

1,296

936

395

229

1,559

1,056

506

315

1,876

17%

26%

27%

20%

95

49

19

163

163

68

31

261

256

110

51

416

372

168

80

620

515

249

127

891

687

364

204

1,255

49%

49%

61%

50%

313

85

72

470

340

82

79

501

332

84

84

500

315

86

90

491

277

82

98

457

222

72

106

401

-7%

-3%

8%

-3%

82

28

2

113

97

34

2

133

113

43

3

158

129

52

3

185

144

63

4

210

146

71

4

221

12%

20%

14%

14%

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

3.4.6-3

3.4.6 AEC Revenue Source

Table 3.4.6-2

AEC CAD/CAM—Worldwide

Applications by Revenue Source

(Percent of Total)

A t I Product Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Coofxiter

Hardware

Software

Service

Total

1^5 1986 1987 1 9 ^ 1%9

1990

66%

22X

13X

100X

i67X

20X

13X

100X

65X

22X

13X

100X

63X

24X

13X

100X

60X

25X

15X

100X

56X

27%

17X

100X

58%

30X

12X

100X

62X

26X

12X

100X

62X

26X

12X

100X

60X

27X

13X

100X

58X

28X

14X

100X

55X

29X

16X

100X

67X

18X

15X

100X

68X

16X

16X

100X

66X

17X

17X

100X

64X

18X

18X

100X

61X

18X

21X

100X

55X

18X

27X

10I3X nx

25X

2%

1(K)X

73X

26X

2X

^m%

71X

27%

2X

100X

70X

28X

2X

100X

68X

SOX

2X

100X

6&X

32X

2X

100X

Source: Dataquest

June 1986

3.4.6-4

1986 Dataquest Incorporated July

CCIS Markets

4.1 Mapping Definitions

The mapping CAD market segment comprises products that are used to create maps. Figure 4.1-1 shows Dataquest's view of the mapping segment, including the

Steps involved in making maps and the major markets for systems used to create maps.

MAJOR MARKETS

The types of businesses that would use a mapping system would be those that:

• Have the responsibility for or ownership of large tracts of land and resources

• Have the need to locate discrete or continuous facilities

• Are concerned with the distribution of customers or services

Each of the major market segments shown in Figure 4.1-1 fits into one or more of these categories.

We believe that the federal government, with its many agencies and branches, is the largest user of mapping systems. We also believe that the oil and gas industry has been (and will continue to be) a major market segment, with its millions of acres of land and ocean floor to keep track of, along with the locations of wells, property lines, and topographical information. Most utilities and local governments have found the cost of a mapping system far too prohibitive and, therefore, do not yet constitute a large portion of the overall market.

Dataquest believes that mapping systems are gaining widespread use among the world's cartographers, surveyors, civil engineers and site planners, photogrammetrists, geophysicists, utilities engineers, and a range of other types of users.

SYSTEM FUNCTIONALITY AND OUTPUT

As shown in Figure 4.4-1, the most common output of a mapping system is a map, which might include topographical (contour) maps, seismic maps, parcel/property maps, utility maps, street network maps, thematic maps, forestry maps, and planimetric maps. Mapping systems may include the following functions:

• Line/point geometry capture

• Polygonal processing

• Survey traverse entry (COGO)

CCIS Markets © 1986 Dataquest Incorporated July 4.1-1

4.1 Mapping Definitions

• Digital terrain modeling/topographic processing

• Interactive graphics editing

• Graphic digitizing

• Edge matching

• Polygon overlay/retrieval

• Vector/grid cell conversion

• Proximal analysis

• Network analysis

• Spatial query

• Coordinate filtering

• Image processing

• Transformation

More Than Just a Map

For many users, automation of mapping is just one part of a total information planning/management process. / ^ equally important function is facilities management—keeping track of information on geographically dispersed plants and equipment. Utility companies are a good example. The utilities market segment fits into the category "have the need to locate discrete or continuous facilities," which might mean telephone poles and wires in the case of telephone utilities or sewers in the case of sewer districts. In these environments, maps are one part of an overall information management effort; these users often place as much as, if not more, emphasis on the data base management capabilities of a system than on its graphics capabilities.

Mapping systems that offer strong data base management capabilities are often referred to as mapping/geographic information systems (M/GIS) or mapping/ facilities management systems (M/FMS). Both types of systems offer the graphics functionality required for generating maps while also fulfilling a wide range of information management requirements. Additional capabilities provided in a full-scale data base management/mapping system might include tabular data entry, file management, statistical analysis, query/browsing, and report generation.

4.1-2 © 1986 Dataquest Incorporated July CCIS Markets

Figure 4.1-1

M a p p i n g

4.1 M a p p i n g Definitions

Editing

Data Capture

Analysis

Data Management

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

4.1-3

4.2 Mapping Executive Summary

This summary highlights the key points and analyses discussed throughout this chapter. Please refer to the chapter in its entirety for a comprehensive analysis of the mapping applications segment.

• The CAD/mapping market is forecast to grow from $220 million in 1985 to

$720 million in 1990.

• This segment represents one of the fastest-growing CAD segments in terms of both system shipments and revenue, with 60 percent and 27 percent compound annual growth rates, respectively, forecast through 1990.

• We believe that host-dependent systems will continue to be the predominant architecture in mapping because of the requirements of many potential users for large and centralized data bases.

• We believe that in the long run, data conversion service bureaus will benefit the most from the market's forecast growth.

• We also believe that success stories on the part of current users have had, and will continue to have, a positive influence on the growth of the mapping segment.

• Digital's MicroV/^ II product will contribute greatly (both as a host-dependent and as a standalone system) to the growth of the market, especially since two out of four of the major mapping vendors offer mainly

VAX-based systems.

CCIS Markets © 1986 Dataquest Incorporated July 4.2-1

4.3 Mapping Market Overview

HISTORY

Evolution

Dataquest estimates that nearly 75 percent of the installed mapping systems were sold after 1978, even though the first systems became available during the early 1970s. Compared with other computer-aided applications (particularly mechanical and / ^ C ) , this timing indicates a much slower acceptance process by the overall base of potential users of mapping systems. Dataquest believes that many users had difficulty justifying the switch to a mapping system for the following two major reasons:

• High hardware costs

• The enormous amount of time and expense involved in the conversion effort from a manual to an automated mapping process (Conversion costs typically run 5 to 10 times the hardware and software costs.)

Until the late 1970s, computers with large storage capacities were required for graphics work, particularly for mapping work. Within the past few years, however, the cost of hardware tools has dropped dramatically, while their capacity for handling graphics and computation-intensive work has increased significantly. This has been a boon for mapping vendors and users alike. However, the prohibitive element still remained—map data conversion. On the average, data conversion costs represent the largest portion of the overall expenditures in automating a mapping and record-keeping process. Thus, the process of automating manual mapping procedures has been far too expensive for many potential users to consider.

CAD, Mapping, or Information Management?

Mapping, like most of the other applications that utilize CAD tools (e.g., EDA,

IC, PCB), demands much more than 2-D drafting functionality (see section

4.1-1 for a list of functions). The earliest mapping systems available from the traditional CAD vendors automated only those tasks associated with drafting. And those systems were termed map drafting systems. The traditional CAD vendors that provided these earliest map drafting systems included Auto-trol, Calma,

Computervision, and Intergraph.

Several vendors, including IBM, Environmental Systems Research Institute

(ESRI), and Synercom Corporation, have adhered to more of a data base management approach since their entry into the mapping market. We believe that this approach has begun to work in their favor, as several markets (particularly utilities and most government sectors) recognized the benefits of using complete mapping/information management tools. We also believe that these particular markets divided over the issue of integrated graphics/data base management systems such that several of the early vendor participants (especially Auto-trol and

Calma) have lost momentum as a result of not addressing the issue.

CCIS Markets © 1986 Dataquest Incorporated July 4.3-1

4.3 Mapping Market Overview

Intergraph addressed the information management issue during 1977 and 1978, first with the Data Management and Retrieval System (DMRS) and later (in 1978) with a linkage capability between the DMRS and its graphics software offerings. In addition to addressing the data management issue, Dataquest believes that a number of other factors have contributed to Intergraphic's success over the years in the mapping segment. They include:

• Multifunctional systems incorporating drafting/design capability as well as mapping-related functionality, which has appealed to the engineeringoriented user markets (i.e., utilities)

• Early migration to a 32-bit platform based on a proven line of computing hardware from Digital Equipment Corporation

• A broad range of solutions for mapping, including extensive graphics functionality suitable for stringent cartographical requirements

Computervision Corporation has also offered systems for mapping (since the mid-1970s). Although it immediately became a major force in this market segment with more than a 30 percent market share during 1979 and 1980, Computervision's revenue declined sharply in 1983 and have since continued to do so. Dataquest attributes much of Computervision's downturn in the mapping segment to the following key factors:

• Its failure to respond quickly enough to the market's transition from a

16-bit hardware architecture to a 32-bit architecture

• The company's decision to offer a proprietary hardware platform when commercially available computers such as Digital Equipment's PDP and

VAX series were gaining widespread acceptance in the general mapping/CAD market

• Computervision's limited applications offerings and data base management functionality

The marketing and product strategies of each of the vendors have naturally determined how their systems are positioned. Regardless of the terminology used to describe their respective offerings (e.g., CAD system, mapping system, GIS system, or FM system), according to Dataquest's definition, the system will always offer a user the ability to create maps.

4.3-2 © 1986 Dataquest Incorporated July CCIS Markets

4.3 M a p p i n g M a r k e t Overview

THE PRESENT

We believe that those vendors that plan to remain competitive in the mapping segment will be focusing primarily on the issues of improved data base management/information handling capability and expansion of application offerings. However, any improvements made to current mapping offerings might prove futile unless prospective buyers are ready to commit the enormous amounts of time and money usually required for conversion from manual mapping to automated mapping practices. In our opinion, the conversion issue is the major roadblock to growth in this industry segment.

The recent proliferation of conversion service bureaus is allowing more users to pursue the alternative of automating mapping. Map and record conversion (building the data base) is the focal point during the early stages of a project. An unsuccessful conversion process would set a user back in both time and dollars.

Users who defer the conversion process to a service company usually find that it decreases the inherent risk associated with implementing a mapping system because the major hardware and software purchases sometimes can be delayed until the conversion stage is under way or even near completion. Hardware cost reductions and early obsolescence are critical issues in the evaluation and purchase of mapping systems.

Existing opportunities for current vendors are:

• The conversion service market itself as an emerging user market

• Conversion service companies as vehicles of exposure for mapping vendors' systems

Conversion service companies are usually equipped with at least one of the commercially available mapping systems. In some cases, partnership agreements have been forged between a conversion service and a vendor, allowing the latter to take advantage of the former's knowledge and expertise in a specific industry.

A prime example is the Synercom/AT&T agreement, which was executed during February 1985. The contract is based on AT&T's use of Synercom mapping systems and specialized application software (OPTS 3) for outside plant information management. AT&T intends to use Synercom's system as a means of establishing a foothold in the lucrative data conversion business. Telephone companies now have a single source of contact for their outside plant map and record conversion needs.

This arrangement also gives telephone companies the ability to postpone hardware and software purchases; AT&T will allow its telephone company customers to interface with the converted data base through a time-share type of terminal and/or

Synercom workstation. Synercom's exposure in the telephone utility market has increased considerably as a result of this and similar contract agreements.

CCIS Markets © 1986 Dataquest Incorporated July 4.3-3

4.3 Mapping Market Overview

It will always be true that no benefits can be realized from computerized mapping until the data are converted. Therefore, Dataquest believes that conversion service companies will benefit handsomely as more users decide to commit the resources of both time and dollars toward implementing an automated mapping system (and information management system for some).

TRENDS

We believe that advances in data capture technology and the proliferation of low-cost microprocessor-based mapping systems will play a major role in the growth of this segment during the remaining half of this decade. Our forecasts for growth in this segment are also based on one other major factor—success stories, which have prompted increased user awareness of the benefits derived from automating the mapping process.

Lovi'-Cost Systems

With the two-year stint of microprocessor-based workstation announcements having passed, we believe that many current vendors (as well as new entrants) in the mapping market will seek to take advantage of the latest standalone and

PC-based hardware by making software available on one or both of these platforms.

As it Stands now, this will afford vendors the chance to tap what we believe is a large potential base of users that have been waiting for a low-cost alternative.

However, what usually denotes a low-cost system today (i.e., engineering workstation or personal computer) could be very different next year, as the price of hardware in general continues to decline. Therefore, even a host-dependent system

(which refers to a central CPU and attached workstations) will eventually fail into the low-cost category, especially when compared with the prices of the past. The issue will really be one of central versus distributed processing data bases.

Dataquest believes that vendors will need to optimize offerings (particularly those with true data base management systems) to address both the central and distributed processing issues.

Scanner Technology

In no Other application is scanning (automated digitizing) such a critical issue.

We believe that the mapping market will benefit greatly (in terms of increased growth) once the issues surrounding scanning are resolved. Two of those issues involve raster-to-vector conversion and the features-recognition capability of a scanning system. While both have been solved to a great extent, the technology is extremely costly for many users to even consider. So as this form of data capture follows the trend of most technology-driven products (i.e., price erosion), we envision greater throngs of users pursuing the alternative to manual mapping methods: automated mapping methods.

4-3-4 © 1986 Dataquest Incorporated July CCIS Markets

4.4.1 Total Mapping CAD/CAM

This section covers the total mapping CAD/CAM market for all regions and product types. Market data are presented in Figures 4.4.1-1 Revenue and

4.4.1-1 Shipments and Table 4.4.1-1.

• The mapping segment was worth an estimated $220 million in 1985 and is forecast to grow to $720 million in 1990, a compound annual growth rate

(CAGR) of 27 percent.

• Dataquest estimates that revenue will increase 31 percent in 1986, reaching

$288 million.

• An estimated 432 systems were shipped in 1985; shipments are forecast to reach 4,572 in 1990, reflecting a 60 percent CAGR through the period.

• An estimated 1,752 workstations were shipped in 1985; shipments are forecast to reach 9,762 units in 1990, growing at a 41 percent CAGR.

CCIS Markets © 1986 Dataquest Incorporated July 4.4.1-1

4.4.1 Total Mapping CAD/CAM

Figure 4.4.1-1 Revenue

Mapping CAD/CAM—Worldwide

Millions of Dollars

720-

640-

560-

480-1

400-

320

240

160-

80

K%?^

^ ^

r

,.v\.%.*

^^

1985

\:\.

^

1986

.SS^^^ p^

wm

M : ^

ism

1988 1969

^^^^^cg

::^v^

v ^•'.v ^•s \ %

-v. V- '4- % %

. -^^ .Tr. ' V ' t ^

^ ^ ^ ^

^

^^i^^y

1990

Source: Dataquest

June 1986

4.4.1-2 1986 Dataquest Incorporated July

CCIS Markets

4.4.1 Total Mapping CAD/CAM

Figure 4.4.1-1 Shipments

Mapping CAD/CAM—Worldwide

Workstation Shipments

10000 T

9000

6000

7000

6000

5000

4000

3000

2000

1000

MM

Kvvvi

1986

" ^

K ^

1986

ys^^

['•e^v^s

« ^

V\

^Js;

W s V - .

^

mm

CSK

\

K>., .

'SS:

"

1987

'^^rv

SSS\^

1966

\'Xx\

vVW"

1969

NSXv

i^i^

1990

s

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

4.4.1-3

4.4.1 Total Mapping CAD/CAM

Table 4.4.1-1

Mapping CAD/CAM—Worldwide

Total Applications

(Millions of Dollars/Actual Units)

1985 1986 1987 1988 1989 1990 CAGR

Total Marlcet

Revenue

Systems

Workstations

220

432

1,752

288

2,153

3,866

375

3,276

5,714

476

3,661

7,001

590

4,083

8,425

720 26.7X

4.527 60.

9,762 41.OX

Source: Dataquest

June 1986

4-4-1-4 © 1986 Dataquest Incorporated July CCIS Markets

4.4.2 Mapping Market Shares

This section covers Dataquest's forecasts for and analysis of the mapping market share distribution. Market share data are presented in Figure 4.4.2-1 and

Table 4.4.2-1.

• Intergraph Corporation continues to dominate the sale of systems used for mapping.

• Dataquest attributes Intergraph's dominance in this market during the past few years to several factors:

— Early entry into the marketplace

— Products that serve a wide range of mapping applications

— Continuous expansion of its product line

— Proven product line based on Digital Equipment's VAX line with

Intergraph's graphics hardware enhancements

— Multifunctional systems (CAD for other applications and mapping)

• Intergraph's 1985 revenue from mapping systems totaled $135 million, which represented approximately 61 percent of total 1985 revenue for this application segment.

• Despite a substantial growth in revenue during 1985, Intergraph lost market share, falling from a 72 percent share in 1984 to 61 percent in 1985.

• Dataquest believes that IBM and Synercom Corporation represented one part of the reason behind Intergraph's substantial loss in market share during 1985, as both companies experienced significant revenue gains; the

Other side of the equation takes into account the addition of companies to

Dataquest's roster of companies for the mapping segment.

• These three top companies continue to penetrate the mapping segment with mostly host-dependent offerings; Intergraph is currently the only company among the three that does not unbundle software, while Synercom has gone to the Other extreme by becoming mostly a software vendor (it does still market its own graphics workstations).

• The Other Turnkey and Software Companies category comprises companies that have $15 million or less in total revenue.

• Dataquest believes that Syscan, of Oslo, Norway, is the largest European company in the mapping segment (included in the Other European

Companies category), with an estimated $15 million in revenue for 1985.

• In the Other Far Eastern Companies category, we believe that Fujitsu is the largest vendor, with an estimated $8 million in revenue for 1985.

CCIS Markets © 1986 Dataquest Incorporated July 4.4.2-1

4.4.2 Mapping Market Shares

Figure 4.4.2-1

Mapping Market ShareWorldwide

1985

Computer vision

2.0%

Source: DataqueM

June 1986

4.4.2-2

1986 Dataquest Incorporated July

CCIS Markets

4.4.2 Mapping Market Shares

Table 4.4.2-1

Mapping Market Share—Worldwide

(Millions of Dollars)

COMPANY

1985

REVENUE

1985

SHARE

Intergraph

IBM

Synercom

CoInputervision

Autodesk

SDRC

Calcomp

Other Computer Conpanies

Other Europe Companies

Other Far East Conpanies

Other Turnkey

t

and Software

All Companies

135

26

17

4

1

1

1

1

22

12

1

220

$

$

$

$

$

$

$

$

$

$

$

$

61.2%

11.9%

7.7%

2.0%

.6%

.3%

.3%

.4%

9.9%

5.5%

.2%

100.0%

Source:

Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

4.4.2-3

4.4.3 Mapping by Region

This section covers Dataquest's forecasts for and analysis of the mapping market, segmented by region. The data are presented in Figures 4.4.3-1 Revenue and 4.4.3-1 Shipments and Tables 4.4.3-1 and 4.4.3-2.

• We believe that the United States will dominate consumption of mapping systems through 1990, with revenue of $145 million in 1985, growing to an estimated $472 million in 1990, a 27 percent CAGR.

• We expect all of the regions to remain at a fairly constant percentage of revenue through 1990.

• Europe had revenue of $47 million in 1985 and is forecast to grow to

$156 million in 1990, a 27 percent CAGR.

• The Far East segment had $18 million in 1985 and is forecast to grow to

$60 million in 1990, a 27 percent CAGR.

• The Rest of World segment had $10 million in 1985 and is forecast to grow to $33 million in 1990, a 27 percent CAGR.

CCIS Markets © 1986 Dataquest Incorporated July 4.4.3-1

4.4.3 Mapping by Region

Figure 4.4.3-1 Revenue

Mapping CAD/CAM by Region

250-

200-

1 5 0 ,

100-

5 0 ,

<

r n?

1985

Millions of Dollars

450-

A

X

400-

North America

Europe

Far East

ROW

350-

300-

X

1988

K "

H

1

1987 1988

X—

<

1969

K

1990

Source: Dataquest

June 1986

4.4.3-2 1986 Dataquest Incorporated July

CCIS Markets

4.4.3 Mapping by Region

This section covers Dataquest's forecasts for and analysis of the mapping market, segmented by region. The data are presented in Figures 4.4.3-1 Revenue and 4.4.3-1 Shipments and Tables 4.4.3-1 and 4.4.3-2.

• We believe that the United States will dominate consumption of mapping systems through 1990, with revenue of $145 million in 1985, growing to an estimated $472 million in 1990, a 27 percent CAGR.

• We expect all of the regions to remain at a fairly constant percentage of revenue through 1990.

• Europe had revenue of $47 million in 1985 and is forecast to grow to

$156 million in 1990, a 27 percent CAGR.

• The Far East segment had $18 million in 1985 and is forecast to grow to

$60 million in 1990, a 27 percent CAGR.

• The Rest of World segment had $10 million in 1985 and is forecast to grow to $33 million in 1990, a 27 percent CAGR.

CCIS Markets © 1986 Dataquest Incorporated July 4.4.3-1

4.4.3 Mapping by Region

250

200

150

100-

Millions of Dollars

500

North A m e r i c a

450

400

X

Europe

Far East

ROW

350

300

Figure 4.4.3-1 Revenue

Mapping CAD/CAM by Region

1985

1986

1987 1986

1989 1990

Source: Dalaquest

June 1 9 8 6

4.4.3-2 1986 Dataquest Incorporated July

CCIS Markets

4.4.3 M a p p i n g by Region

2800

2100

1400

700-

Workstation Shipments

6300

5600

• North America

• Europe

A Far East

X ROW

4900

4200

3500

Figure 4.4.3-1 Shipments

Mapping CAD/CAM by Region

1985 1988 1987 1988 1989 1990

Source: Dataqueit

June 198^

CCIS Markets

1986 Dataquest Incorporated July

4.4.3-3

4.4.3 M a p p i n g by Refgion

Table 4.4.3-1

M a p p i n g CAD/CAM

Application by Region

(Millions of Dollars/Actual Units)

1985

1986 1987 1988

1989

1990

CAGR

Total Marlcet

Revenue

Systems

Workstations

220

432

1,752

288

2,153

3,866

375

3,276

5,714

476

3,661

7,001

590

4,083

8,425

720

4,527

9,762

26.7X

60. OX

41.OX

North America

Revenue

Systems

Workstations

145

201

1,135

189

1.221

2,369

246

2,082

3,751

312

2,077

4,468

387

2,110

5,336

472

2,264

6,263

26.7X

62.3X

40.7X

Europe

Revenue

Systems

Workstations

47

182

372

62

767

1,097

81

864

1,351

103

970

1,632

127

1,170

1,986

156

1.341

2.251

26.8X

49.1X

43.4X

Far East

Revenue

Systems

Workstations

Rest of World

Revenue

Systems

Workstations

18

37

162

10

12

84

24

79

234

13

87

166

31

206

373

17

125

239

40

445

573

22

168

328

49

593

681

27

211

422

60

701

750

33

221

498

26.9X

79.7X

35.9X

26.7X

80. OX

42.8X

Source:

Dataquest

June 1986

4.4.3-4

1986 Dataquest Incorporated July

CCIS Markets

4.4.3 Mapping by Region

Table 4.4.3-2

Mapping CAD/CAM

Application by Region

(Percent of Total)

1985 1986

1987 1988 1989 1990

North America

Revenue

Systems

UorIcstations

Europe

Revenue

Systems

Workstations

Far East

Revenue

Systems

Workstations

Rest of World

Revenue

Systems

Workstations

66%

47X

65%

66X

57X

61X

66X

64X

66X

66X

57X

64X

66X

52X

63X

66X

SOX

64X

22X

42X

21X

22X

36X

28X

22X

26X

24X

22X

26X

23X

22X

29X

24X

22X

SOX

23X

8X

9X

9X

5X

3X

5X

8X

4X

6X

5X

4X

4X

8X

6X

7X

5X

4X

4X

8X

12X

8X

5X

5X

5X

8X

15X

8X

5X

5X

5X

8X

15X

8X

5X

5X

5X

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

4.4.3-5

4.4.4 Mapping Product Types

The following section covers Dataquest's forecasts for and analysis of the

CAD/CAM mapping market, segmented by product type. The data are presented in

Figures 4.4.4-1 Revenue and 4.4.4-1 Shipments and Tables 4.4.4-1 and 4.4.4-2.

• Revenue from host-dependent systems dominated in 1985, accounting for

$215 million, or 98 percent of all mapping revenue.

• Host-dependent workstation shipments also dominated in 1985, representing 90 percent of all workstation shipments.

• Dataquest forecasts that host-dependent workstation shipments and revenue will continue to dominate through 1990, accounting for 63 percent of workstation shipments and 17 percent of system shipments.

• We expect a sharp escalation in 1986 in both standalone and personal computer-based system shipments, as much more software is now available for mapping applications on these two types of hardware platforms.

• We believe that sales of standalone workstation-based systems will eventually outdistance sales of both host-dependent and personal computer-based systems due to the exceptional price/performance characteristics of this system architecture.

CCIS Markets © 1986 Dataquest Incorporated July 4.4.4-1

4.4.4 M a p p i n g P r o d u c t Types

Figure 4.4.4-1 Revenue

M a p p i n g CAD/CAM by Product Type—Worldwide

Millions of Dollars

540

480

• Standalone

• Host-Dependent

A Personal Connputer

420

360

300

240-

180

120-

1985 1986 1987 1988 1989 1990

Source: Dataquest

June 1986

4.4.4-2

1986 Dataquest Incorporated July

CCIS Markets

4.4.4 Mapping Product Types

Figure 4.4.4-1 Shipments

Mapping CAD/CAM by Product TypeWorldwide

4200

3500

2800

2100

1400

700

Workstation Shipments

6300-

5600

• Standalone

• Host-Dependent

A PersonaI Computer

4900

1985 1986 1987 1988 1989

1990

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

4.4.4-3

4.4.4 Mapping Product Types

Table 4.4.4-1

Mapping CAD/CAM—Worldwide

Application by P r o d u c t Type

(Millions of Dollars/Actual Units)

1985 1986 1987 1988

1989 1990

CAGR

Total Market

Revenue

Systems

Workstations

Standalone

Revenue

Systetns

Workstations

220

432

1,752

2

26

26

288

2,153

3,866

20

201

201

375

3,276

5.714

476

3,661

7,001

590

4,083

8.425

720

4,527

9,762

26.7%

60.0%

41.OX

50

512

512

99

1,036

1,036

164

1,724

1,724

256

2,681

2,681

160.9X

152.2%

152.2%

Host-Dependent

Revenue

Systems

Workstations

Personal Conputer

Revenue

Systems

Workstations

215

256

1,577

260

328

2,041

311

442

2,880

362

569

3,910

411

691

5,033

451

771

6,006

16.0%

24.7%

30.7%

3

149

149

8

1,624

1,624

14

2,323

2,323

15

2,056

2.056

15

1.668

1.668

13

1,075

1,075

31.9%

48.4%

48.4%

SOURCE: Oatsquest'

June 1986

4 . 4 . 4 - 4

1986 Data quest Incorporated July

CCIS Markets

4.4.4 Mapping P r o d u c t Types

Table 4.4.4-2

M a p p i n g CAD/CAM—Worldwide

Application by P r o d u c t Type

(Percent of Total)

1985 1986 1987

1988 1989 1990

Staiidalone

Revenue

Systems

Uorlcstations

Host-Dependent

Revenue

Systems

Workstations

Personal Computer

Revenue

Systems

Workstations

1%

6X

1%

7X

9X

5X

13X

16X

9X

21X

28%

15X

28X

42X

20X

36%

59%

27%

98X

59X

90%

90X

15X

53X

83X

13X

50%

76X

16X

56%

70X

17X

60X

63%

17%

62%

IX

35X

9X

3X

75X

42X

4X

71X

41X

3X

56X

29X

3X

41X

20X

2%

24%

11%

SOURCE: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

4.4.4-5

4.4.5 Mapping Turnkey Average Prices

This section covers Dataquest's forecasts for and analysis of the average price per seat by product type for the mapping turnkey segment. The data are presented in Figure 4.4.5-1 and Table 4.4.5-1.

• We believe that the average price per seat for mapping will decrease from

$97,300 in 1985 to $50,000 in 1990, which represents a negative

12 percent CAGR.

• Most personal computer-based mapping systems still offer only the functionality that is inherent in most CAD systems—map drafting; this is largely the reason behind a relatively low average price per seat of

$16,600 in 1985.

• We believe that personal computer-based systems will continue to automate only the mapping applications that do not require high cartographical

Standards; therefore, we estimate that the average selling price for these systems will remain at a fairly constant level through 1990.

• Host-dependent systems had the highest average price in 1985, at

$107,100 per seat, and will continue to do so until 1988, when the average price per seat of standalone product types is forecast to be greater, at about

$64,700 per seat, compared with $43,600 per seat for host-dependent product types.

CCIS Markets © 1986 Dataquest Incorporated July 4.4.5-1

4.4.5 Mapping Turnkey Average Prices

Figure 4.4.5-1

Mapping Turnkey—Worldwide

Average Price per Seat

Thousands of Dollars

120-

100-

• Standalone

• Host-Dependent

A Personal C o m p u t e r

40

20-

1985 1986 1987 19S8

1989 1990

Source: Dataquest

June 1986

4.4.5-2 © 1986 Dataquest Incorporated July

CCIS Markets

4.4.5 M a p p i n g Turnkey Average Prices

Table 4.4.5-1

M a p p i n g Turnkey—Worldwide

Average Price p e r Seat

(Thousands of Dollars)

All Product Types

Standalone

Host-Dependent

Personal Computer

1985 1986 1987 1988 1989 1990 CAGR

97.3

54.8

107.1

16.6

86.7

73.1

96.1

16.5

71.8

70.9

78.8

16.4

62.7

68.8

64.7

16.4

55.3

66.7

53.1

16.4

50.0 . -12%

64.7 3X

43.6 -16X

16.3. -OX

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July 4.4.5-3

4.4.6 Mapping Revenue Sources

This section covers Dataquest's forecasts for and analysis of the mapping market, segmented by revenue source. The data are presented in Figure 4.4.6-1 and

Tables 4.4.6-1 and 4.4.6-2.

• We estimate that hardware accounted for 62 percent of total revenue in

1985; we estimate that the hardware portion of revenue will decrease through 1990 to 44 percent in that year.

Software revenue is expected to increase from 22 percent of total revenue in 1985 to 36 percent in 1990, representing a 40 percent compound annual growth rate.

• Revenue from service is also expected to increase as a percentage of total revenue through 1990. In 1985, service represented 16 percent of revenue, and in 1990, service is expected to make up 20 percent of total revenue.

CCIS Markets © 1986 Dataquest Incorporated July 4.4.6-1

4.4.6 Mapping Revenue Sources

Figure 4.4.6-1

Mapping CAD/CAM—Worldwide

Applications by Revenue Source

200

160

120-

Thousands of DoIlars

320

Hardware

Software

28t)-| . ^ .

A ServIce

240

0 - i —

1985

1986

1987 1988 1989 1990

Source: Dataquest lune 1986

4.4.6-2

1986 Dataquest Incorporated July

CCIS Markets

4.4.6 M a p p i n g Revenue Sources

Table 4.4.6-1

Mapping CAD/CAM—Worldwide

Applications by Revenue Source

(Millions of Dollars)

All Product Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Computer

Hardware

Software

Service

Total

1985 1986 1987 1988 1989 1990

CAGR

137

48

35

220

170

73

45

288

212

103

59

375

255

143

78

476

292

193

106

590

319

256

145

720

18X

40%

33%

27%

1

1

0

2

10

9

2

20

24

21

4

50

46

44

9

99

73

75

16

164

105

123

29

256

153X

170X

176%

161X

135

45

35

215

157

59

44

260

183

73

55

311

204

89

69

362

216

107

89

411

212

123

116

451

9%

22X

27X

16X

1

2

0

3

3

5

0

8

5

9

0

14

4

10

0

15

4

11

0

15

2

11

0

13

13X

39X

32X

32X

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

4.4.6-3

4.4.6 Mapping Revenue Sources

Table 4.4.6-2

Mapping CAD/CAM—Worldwide

Applications by Revenue Source

(Percent of Total)

All Product Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Computer

Hardware

Software

Service

Total

1985 1986

1987 1988 1989 1990

62X

22X

16X

100X

59X

25X

16X

100X

57X

28X

16X

100X

54X

30X

16X

100X

49X

33X

18X

100X

44X

36X

20X

100X

48X

41X

8X

100X

49X

42X

8X

100X

48X

43X

9X

100X

47X

44X

9X

100X

44X

46X

10X

100X

41X

48X

11X

100X

63X

21X

16X

100X

61X

23X

17X

100X

59X

23X

18X

100X

56X

25X

19X

100X

52X

26X

22X

100X

47X

27X

26X

100X

36X

63X

IX

100X

36X

64X

IX lom

33X

66X

IX

100X

28X

71X

IX

100X

23X

76X

IX

100X

17X

83X

IX

100X

Source: Dataquest

June

1986

4.4.6-4

1986 Dataquest Incorporated July

CCIS Markets

5.1 EDA Definitions

DEFINITION

The electronic design automation (EDA) segment refers to CAD/CAM products that are typically used in the engineering or design phase of electronic products (as opposed to the physical layout of the products). EDA system users are most often electrical engineers.

The most common output of an EDA system is a net list—a logical or functional description of an integrated circuit, printed circuit board, electronic system, or product. The output is used to analyze the performance or functionality of the circuit and is also used in another product design phase to manually or automatically create the physical layout.

EDA systems may include the following functionalities:

• Schematic capture

• Logic simulation

• Circuit simulation

• Timing verification

• Test pattern generation

• Fault simulation

• Thermal analysis

Net list extraction (NLE)

• Microprocessor development interfaces

• Software engineering

• Engineering documentation

• Interfaces to external CAD/EDA tools

Because of significant differences between the marketing and product strategies for EDA, IC, and PCB CAD, Dataquest will continue to differentiate and segment the electronic CAD/CAM market in this manner. Therefore, by definition, EDA does not include layout.

CCIS Markets © 1986 Dataquest Incorporated July 5.1-1

5.2 EDA Executive Summary

This summary highlights the key points and analyses discussed throughout this chapter. Please refer to the chapter in its entirety for a comprehensive analysis of the EDA applications segment.

The EDA market is forecast to grow from $531 million in 1985 to

$1.3 billion in 1990, representing a 21 percent CAGR.

• The EDA market is forecast to grow only 19 percent in 1986 because of the economic conditions of the overall electronics industry and a slowdown in several vendors' annual revenue.

• In 1985, the personal computer accounted for 72 percent of all EDA workstations shipped, but for only 27 percent of all EDA revenue.

• Standalone workstations, which accounted for 60 percent of all EDA revenue in 1985 and 27 percent of all workstations shipped, are forecast to make up 76 percent of ail units shipped and 85 percent of all EDA revenue in 1990.

The average selling price per seat for all product types is expected to decline at a 12 percent CAGR, from $43,000 in 1985 to $23,000 in 1990.

Dataquest anticipates much consolidation and retrenching among EDA vendors, with company roles and product offerings being redefined to adjust to the high number of vendors.

CCIS Markets © 1986 Dataquest Incorporated July 5.2-1

5.3 EDA Market Overview

EDA HISTORY

Prior to 1981, the emphasis of electronic CAD/C/^M vendors was primarily on physical layout applications for both integrated circuits and printed circuit boards.

However, the electronic product design process does not begin with physical layout, nor does it end with EDA applications.

Until the introduction of the first commercially available EDA product in 1981, there was a gaping hole in the line of products offered to companies that needed to automate the electronic product design process. Thus began the EDA segment of the CAD/CAM industry—products for engineers that could be used to automate the engineering process of the product design cycle.

The market has not been the same since then. The depth of product functionality has expanded from simply straightforward schematics capture and logic design. New applications such as physical layout were integrated with EDA functionality. New hardware platforms were born virtually overnight. New companies entered the market, increasing the ante and the stakes.

Thus, the electronic CAD/CAM market has evolved to encompass EDA. The needs of the electrical engineers to increase productivity—to make the design cycle more efficient at the same time as shortening it—are finally being addressed by the

$531 million 1985 market.

WHY DATAQUEST CALLS IT EDA

One of the biggest underlying trends in the entire CAD/CAM market is the move toward providing computer-aided engineering (CAE) applications. CAE is used by engineers of all disciplines to automate the engineering and analysis phase of any product's design cycle. For instance, mechanical engineers apply CAE to their design tasks using applications such as stress analysis, kinematics, and finite element analysis. Dataquest believes that the vendors addressing the needs of electrical engineers have made such a significant impact on the way in which electronic products are designed, as well as on the CAD products themselves, that we chose to differentiate CAE for electrical engineers from all other CAE applications. Hence the term electronic design automation (EDA) for electronic computer-aided electrical engineering applications.

CCIS Markets © 1986 Dataquest Incorporated July 5.3-1

5.3 EDA Market Overview

EDA AND LAYOUT DISTINCTIONS

The leading EDA vendors' first product lines consisted of schematics capture.

Shortly after introduction, schematics capture grew to encompass logic design, with various forms of analysis, simulation, and verification. Dataquest distinguishes between schematics capture and logic design by the following definitions:

• Schematics capture is the ability to graphically draw the electrical schematics, or logic diagram, of a product primarily for documentation purposes.

• Logic design includes schematics capture plus the ability to associate electrical parameters with the graphic schematic symbols, facilitating analysis and simulation.

Logic design is the more comprehensive of the two applications because it maintains information such as power, timing, and performance.

The three leading companies in 1985 also included printed circuit board and/or integrated circuit physical layout applications product lines.

Companies with physical layout products as their original entry into the ECAD market have also expanded their product functionality to include logic design.

While we recognize that several leading physical layout companies have had schematics capture capabilities for many years, we distinguish between schematics capture as documentation and schematics capture as logic design with electrical connectivity.

Because EDA and physical layout functions can be highly integrated, especially with automatic layout dependent on EDA data, it is impossible to separate completely the two applications. Electronic product design does not end with logic design. Therefore, it is important to note the following regarding Dataquest's EDA segmentation:

• The EDA estimates and forecasts are for systems with EDA applications only.

• The EDA chapter refers to functionality. It is also applicable to IC and PCB physical layout products and segments and their respective chapters in this binder.

THE UNDERLYING ISSUES

Dataquest believes that technology is the key driver in the EDA segment, with marketing and sales acting as the vehicle in which it is delivered to the end user. As is most often the case when technology is the driver, an abundance of alternatives emerges when different avenues of product development are explored.

5.3-2 © 1986 Dataquest Incorporated July CCIS Markets

5.3 EDA Market Overview

The design choices presented by EDA products are many and varied. However,

Dataquest believes that there are two clearly defined underlying issues steering the market. These issues are:

• Applications

• Hardware

Applications

The electrical engineering community has an insatiable appetite for EDA applications software, while the EDA vendors push the limits of technology and

R&D to deliver solutions. Dataquest believes that the most significant and successful application development efforts are directed toward the following:

• Hierarchical design

• /^alysis

• Test functions

• Integration

Hierarchical Design

We believe that it is imperative that EDA systems take advantage of hierarchical design methodologies because of:

• Increasing circuit complexity

• Application-Specific designs

• The need to share design data among functional organizations within a company and/or with a company's outside manufacturer

The definition and implementation of hierarchical design has evolved as the

EDA products themselves have matured. It involves a circuit or product design occurring in increasing levels of detail, with each new level directly correlating with the levels below and above it. In this way, engineers are not forced to deal with or manage massive amounts of detail without first visualizing the concept of the product.

The significance of hierarchical design is that it facilitates delegating design responsibility among many engineers and it allows the design to be analyzed in varying stages of completion. Successful EDA products allow users to implement their own variation of hierarchical design methodologies. In this way, users can take advantage of existing analysis and simulation products.

CCIS Markets © 1986 Dataquest Incorporated July 5.3-3

5.3 EDA Market Overview

Analysis

Perhaps even more significant than actual design methodology is the ability to analyze the design. Is it behaving correctly? Is it functionally doing what it was intended to? Is it performing to specification?

Circuit analysis involves simulating a design using software models and stimuli.

It allows engineers to determine the details of a design prior to building a hardware prototype, with the obvious benefits of reducing costs and turnaround time.

The analysis products available can be categorized by the following functional types:

• Logic simulation—Functional analysis ranging in level of hierarchy, from gate- to block-level circuit descriptions

• Circuit simulation—Transistor-level simulation involving intrinsic electrical analysis

• Timing verification—Performance analysis involving the speed at which a circuit operates

• Fault simulation—Analysis of the testability of a circuit involving test vectors and patterns

Test Functions

While the availability of products that interface design with test is growing,

Dataquest believes that this is one application of EDA that is underdeveloped.

Testing interfaces and automatic test vector generation are receiving a lot of R&D effort because of the amount of demand from users.

Traditionally, the transition of a design from a design engineer to a test engineer was a slow, error-prone, and tedious task. The test engineer created programs or stimuli for test equipment—logic analyzers to automatic test equipment

(ATE)—that determined the correctness of a prototype, breadboard, or volume production part. It was virtually left up to the test engineer to determine which parts of the circuit should be tested, without necessarily knowing which paths were critical to test.

EDA systems, however, generate design data that can be used as input to test programs by indicating which parts of the circuit should be tested and by specifying the expected performance. The link between design and test should be automatic through the design data base itself.

As test software interfaces have become more applicable to the design environment, testing manufacturers have also developed entry-level test equipment that operates within the design—not test—environment for immediate prototype feedback that can be analyzed by the design engineer.

5.3-4 © 1986 Dataquest Incorporated July CCIS Markets

5.3 EDA Market Overview

The importance of testing cannot be underestimated, because as electronic

CAD systems become more effective in dealing with complex product design, they, in effect, create a bottleneck at the testing phase. By incorporating testing capability in the initial design phase, i.e., design for testability, the design cycle itself becomes a closed and controllable loop, from concept to product delivery.

Integration

The proliferation of applications creates a new set of problems that must be dealt with effectively for EDA products to be productive and useful. The problem is integration—how to ensure that ECAD applications programs, design tasks, and people involved with the process can communicate with one another quickly, efficiently, and error free.

Integrating the entire design process into a cohesive and workable solution has been a hard, uphill battle for most EDA vendors and users. Integration has often been an afterthought, evident by several data bases and editors residing within one system.

The workaround to a system that is not cleanly integrated is to include data base extraction products and postprocessors that allow different design tools to communicate with one another. While this workaround is not the optimal solution, it does provide a short-term alternative.

Hardware

The EDA segment emerged out of a need for products that solved electrical engineers' design problems. However, only with the emergence of the standalone, microprocessor-based workstation could this need be met.

The availability of standalone workstations revolutionized the ECAD market, including its design solutions and existing price and profit structures. Had the pioneering companies such as Apollo, Daisy, S,un, and Valid not developed the hardware vehicle, the EDA revolution might have been delayed for another three years—until the IBM PC.

Dataquest distinguishes between the hardware and application issues of the market. It is the application products that meet users' needs and the hardware products by which tiiey are delivered. Users buy neither hardware nor software.

They buy solutions to design problems, and these solutions are combinations of hardware and software.

However, hardware technology, implementation, and adaptation are changing underlying applications strategies. The major cause of this is the personal computer. The major effect is a dramatic shift in computational alignment—aligning application requirements with computer capabilities.

OCXS Markets © 1986 Dataquest Incorporated July 5.3-5

5.3 EDA Market Overview

The shift has brought about yet another layer of hardware to the EDA environment—the application accelerator, which decreases the time involved to complete one or more applications.

Application Accelerators

The EDA segment continues to pioneer hardware innovations and utility.

Application accelerators are another example. We believe that there are three primary reasons for the development of accelerators:

• They filled a need that arose from a lack of computing power, first at the standalone level, then at the personal computer level.

• They keep computer power distributed and off of hosts and mainframes.

• They are a way of adding value and profit to product lines.

We believe that application accelerators are a workaround to standalone and

PC performance shortcomings. We see an accelerator as a means to an end, not an end in itself. For example, we believe that the underlying need is the application, such as simulation and analysis. The constraint placed on the application need is that it be performed in an acceptable time frame.

The technology of most (although not all) accelerators is specialized, pipelined parallel processors that offload the main CPU. They are usually board sets that plug into the host or are in separate cabinets that communicate with the host. They generally exist because the original architecture is not capable of, or not configured to, process background tasks in an effective and timely manner.

Exceptions are accelerators that are optimized to particular applications, either through firmware or customized silicon. In any case, the exceptions are not general-purpose hardware and are an integral part of the application's operation.

Customized accelerators are not easy for CPU manufacturers to duplicate for product enhancements.

TRENDS

TTie underlying issues—applications and hardware—are also the forces shaping the future of the EDA segment. (Corporate structures are also changing the way in which ECAD business is conducted; they are discussed below under "A

Fragmented Market.")

5.3-6 © 1986 Dataquest Incorporated July CCIS Markets

5.3 EDA Market Overview

Applications

Dataquest believes that product development will continue to focus on the four levels of products discussed under "Underlying Issues": hierarchical design, analysis, test, and integration. We identify the following trends that affect each of these four levels:

• Single-point data bases that support both logic and physical design with one interface

• Hierarchical simulation supporting varying levels of design completion

• Mixed-mode simulation working with different levels of hierarchy and simulating varying design representations (such as gate, switch, or transistor levels)

• Integration with physical layout for back annotation and design verification

• Test patterns generated automatically through the design data base, possibly including logic sensitivity scan design (LSSD) methodology

• Immediate simulation feedback through either single-point data bases or application accelerators

• True systems design capability supporting simulation of multiple chips and boards, different physical layout representations, and packaging requirements

• High-level design synthesis

We believe that the overall theme of application trends is not focused on product features, but on increased scope. EDA products become an integrated design management tool set by incorporating not only more design tasks, but also analysis capabilities at varying degrees of completion. The result is a design management system—one that meets the needs of a project with many aspects and requirements.

Hardware Platforms—A Division of Labor

The hardware platforms on which EDA software run are radically changing the availability and feasibility of design automation for the mass end-user market.

Listed below are the major causes of this change:

• Personal computers and coprocessors

• Application accelerators

CCIS Markets © 1986 Dataquest Incorporated July 5.3-7

5.3 EDA Market Overview

• Decreasing standalone prices

• High-end standalone systems

In all cases, price and performance are paramount. The trend, however, is toward the division of labor between the system workhorse and the personal, desktop design system. To manage this change, we believe that a very flexible and pro fit-oriented management style is required for the following reasons:

• Downward-revised revenue goals due to lower average selling prices

• Higher unit volumes required to meet revenue goals

• Revised distribution strategies due to higher volumes

• Revised support strategies due to larger installed bases and lower average selling prices

• Increased competition due to less formidable barriers to entry

The Economics of Labor Division

Two years ago, personal computers were barely considered a design automation alternative. Today, they threaten the very existence of the original EDA platform—the standalone workstation. We do not believe that standalones will be obsoleted by PCs (with or without coprocessors). We believe that what is occurring is just natural evoiution.

It is a simple lesson of supply-and-demand economics. Dataquest believes that the end-user market will continue to force prices down across the board, especially where higher prices are unwarranted. End users will also continue to force increased performance, at a fair price and only when applications require it.

A FRAGMENTED MARKET

Revised corporate strategies are changing the way in which long-term successful EDA companies will do business. The major corporate changes that we believe are occurring include:

• Product development efforts:

— Platform-free software

— Open data bases

— Buy versus make hardware

5.3-8 © 1986 Dataquest Incorporated July CCIS Markets

5.3 EDA Market Overview

• Marketing strategies

— Niche versus full functionality

— Bundled versus unbundled software

• Strategic alliances

• Offshore alliances

The thrust of all the strategic decisions above involves adding value to either the distribution channel or the implementation of design automation systems.

We believe that no one company will be the leading supplier of all design automation software. Instead, we believe that the following scenario will transpire:

• Three to five companies will lead as suppliers of end-to-end design products.

• Ten to twenty companies will compete with major portions of design automation products.

• Five to ten companies will compete with niche products, with only one or two companies being leaders in any given product niche.

This scenario depicts electronic CAD/CAM companies, not just EDA applications. We believe that it is important to analyze the market in this way because of the interdependencies between logic design and physical layout.

Innovative product development will continue to occur. However, we believe that it will become more difficult for the mass vendor market to exploit innovations because of current product implementations. For example, once a data structure and data base are implemented and installed in the customer base, it becomes nearly impossible to change that structure to take advantage of an integrated, single-point data base. For this reason, we believe that the EDA and ECAD segments will continue to be fragmented throughout the decade.

CCIS Markets © 1986 Dataquest Incorporated July 5.3-9

5.4.1 Total EDA CAD/CAM

This section covers the total electronic design automation (EDA) CAD/CAM market for all regions and product types. Market data are presented in

Figures 5.4.1-1 Revenue and 5.4.1-1 Shipments and Table 5.4.1-1.

• The EDA segment was worth an estimated $531 million in 1985 and is forecast to grow to $1,354 million in 1990, a compound annual growth rate

(CAGR) of 21 percent.

• Dataquest estimates that revenue will increase only 19 percent in 1986, reaching $632 million.

• Dataquest estimates that 14,068 workstations were shipped in 1985.

Shipments are expected to reach 42,895 units in 1990, growing at a

25 percent CAGR.

CCIS Markets © 1986 Dataquest Incorporated July 5.4.1-1

5.4.1 Total EDA CAD/CAM

Figure 5.4.1-1 Revenue

EDA C A D / C A M - W o r l d w i d e

Millions of Dollars

1600-1

1400

1200-

1000

600

600

400

200

^ ^

pi

MM

s ^

m^

K ^ \ X -4 -I

K'-^i^s

1985

^s^

1987 1988

^

;N^^^^

Wvv

. > ^ \ , \ • • ^ ^ '

r

II

^ ^

V^NXx,

1990

1989

Source: Dataquest

June 19S6

5.4.1-2

1986 Dataquest Incorporated July

CCIS Markets

5.4.1 Total

J : D A C A D / C A M

Workstation Shipments

45000

400004

35000

30000

25000-1

20000

15000

10000

5000-1

1985 1986

Figure 5.4.1-1 Shipments

EDA CAD/CAM—Worldwide

1987 igss 1989 1990

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

5.4.1-3

5.4.1 Total EDA CAD/CAM

Table 5.4.1-1

EDA Turnkey

Total Applications

(Millions of Dollars/Actual Units)

1985 1986 1987 1988 1989 1990 CAGR

Total Marlcet

Revenue

Systems

Workstations

531

14,036

14,068

632

18.705

18,733

764

22,785

22,817

940

27,767

27,803

1,138

34,287

34,320

1.354 20.6%

42,873 25.0%

42.895 25.0%

Source: Dataquest

June 1986

5.4.1-4 © 1986 Dataquest Incorporated July CCIS Markets

5.4.2 EDA Market Shares

This section covers Dataquest's forecasts for and analysis of the EDA

CAD/CAM market share distribution. Market share data are presented in

Figure 5.4.2-1 and Table 5.4.2-1.

• Mentor Graphics and Daisy Systems clearly dominated the 1985 EDA market with a combined 44 percent of the market.

• Mentor Graphics continued its role as EDA market leader in 1985.

Dataquest ranks Mentor Graphics' market share at 24 percent, up from its

17 percent share in 1984.

• Second-ranked Daisy Systems garnered a 20 percent market share in 1985, up 9 percentage points from its 1984 position.

• Valid Logic maintained its number three position, capturing 9 percent of the market, down 2 points from its 1984 market share.

• Simulation tool vendor Zycad Corporation ranked fourth in the EDA market with a 5 percent market share.

• FutureNet captured fifth position with a 4 percent share of the market.

• Given the fragmented nature of the EDA market, as well as significant

1986 market debuts of companies currently possessing no share of this market, such as Hewlett-Packard and IBM, we expect this year's market to be distributed among a larger vendor base.

CCIS Markets © 1986 Dataquest Incorporated July 5.4.2-1

5.4.2 EDA M a r k e t Shares

Figure 5.4.2-1

EDA M a r k e t Share by Company—Worldwide

1985

Cadnetlx

1 % -

Sllvar-Llsco

2%

Tektronix

2 %

Computervislon

3%

Control Data

3%

Source: Dataquest

June 1986

5.4.2-2

1986 Dataquest Incorporated July CCIS Markets

Table 5.4.2-1

EDA Market Share by Company

(Millions of Dollars)

5.4.2 EDA Market Shares

COMPANY

Mentor

Daisy

Valid

Zycad

Futurenet

Control Data

Computervision

Tektronix

Silvar-Lisco

Cadnetix

Calma

Telesis

Racal-Redac

Other Computer Companies

Other Europe

CoIipanies

Other Far East

Companies

All Companies

1985

REVENUE

1985

SHARE

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

127

107

49

26

20

14

13

10

20

29

531

11

11

8

4

2

1

79

23.9%

20.2%

9.2%

4.9%

3.7%

2.6%

2.5%

2.1%

2.1%

1.4%

.7%

.5%

.2%

14.9%

1.9%

3.8%

5.4%

100.0%

Source:

Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

5.4.2-3

5.4.3 EDA Regions

This section covers Dataquest's forecasts for and analysis of the EDA market, segmented by region. Market data are presented in Figures 5.4.3-1 Revenue and

5.4.3-1 Shipments and Tables 5.4.3-1 and 5.4.3-2.

• North America is expected to dominate regional EDA consumption.

• We estimate that 1985 North /American revenue was $358 million and that it will grow to $912 million in 1990, a 21 percent CAGR.

• European revenue was $106 million in 1985 and is forecast to reach

$271 million in 1990, growing at a 21 percent CAGR.

• The Far Eastern segment was worth $66 million in 1985 and is forecast to grow at a 21 percent CAGR to reach $169 million in 1990.

• The rest of the world accounted for $1 million, less than 1 percent of EDA revenue. We estimate that it will grow to $2 million in 1990, 21 percent

CAGR.

• We believe that North America, with 67 percent of the total market, will remain the largest consumer of EDA products because of the two following interrelated variables:

— Worldwide distribution of electronic product manufacturers

— A disproportionate amount of in-house-developed software among the

Japanese electronic product manufacturers

• The Far East, with 12 percent of worldwide consumption, is not forecast to increase because of the large amount of in-house software.

• We expect Europe to maintain a fairly constant 20 percent of worldwide consumption.

CCIS Markets © 1986 Dataquest Incorporated July 5.4.3-1

5.4.3 EDA Regions

Figure 5.4.3-1 Revenue

EDA CAD/CAM by Region

700

600

500-^

400

300-^

200

100

Millions of Dollars

1000-

900

800

A

X

North America

Europe

Far East

Rest Of World

0^

1985 1986

-¥-

1987 1988

1989 1990

Source: Dataquest

June 19S6

5.4.3-2

1986 Dataquest Incorporated July

CCIS Markets

5.4.3 EDA Regions

Figure 5.4.3-1 Shipments

EDA CAD/CAM by Region

Workstation Shipments

30000

27000

24000

21000

18000

15000

12000

9000-

6000-

3000-

1985 1986 1987 1989 1989 1990

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

5.4.3-3

5.4.3 EDA Regions

Table 5.4.3-1

EDA Turnkey

Applications by Region

(Millions of Dollars/Actual Units)

1985

1986 1987 1988 1989 1990

CAGR

Total Harket

Revenue

Systems

Workstations

531

14,036

14,068

632

18,705

18,733

764

22,785

22,817

940

27,767

27,803

1,138

34,287

34,320

1,354

42,873

42,895

20.6%

25.0%

25.0%

North America

Revenue

Systems

Workstations

358

10,692

10,686

426

13,131

13,154

515

15,957

15,981

633

19,255

19,281

766

23,581

23.606

912

29,219

29,237

20.6%

22.3%

22.3%

Europe

Revenue

Systems

Workstations

106

2,424

2,422

126

3,241

3,245

153

3,906

3,912

188

4,900

4,907

228

6,212

6,218

271

7,985

7,987

20.7%

26.9%

27.0%

Far East

Revenue

Systems

Workstations

Rest of World

Revenue

Systems

Workstations

66

916

953

1

5

6

79

2,319

2,320

1

14

14

95

2,897

2,899

1

25

25

117

3,577

3,579

1

36

36

142

4,449

4,451

2

45

46

169

5,612

5,613

2

57

58

20.7%

43.7%

42.6%

20.5%

64.OX

57.6%

Source: Dataquest

June 1986

5.4.3-4

1986 Dataquest Incorporated July

CCIS Markets

5.4.3 EDA Regions

Table 5.4.3-2

EDA Turnkey

Applications by Region

(Percent of Total)

1985

1986 1987 1988 1989 1990

North America

Revenue

Systems

Workstations

Europe

Revenue

Systems

Workstations

Far East

Revenue

Systems

Workstations

Rest of World

Revenue

Systems

Workstations

67%

76%

76%

20%

17X

17X

20X

17X

17X

20X

17X

17X

20X

18X

18X

20%

18%

18X

20X

19%

19X

12X

7X

7%

OX

OX

OX

67X

70X

70X

12X

12X

12X

OX

OX

OX

67X

70X

70X

67X

69%

69X

67X

69X

69X

12X

13X

13X

OX

OX

OX

12X

13X

13X

OX

OX

OX

12X

13X

13X

OX

OX

OX

67%

68X

68X

12X

13X

13X

OX

OX

OX

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

5.4.3-5

5.4.4 EDA Product Types

This section covers Dataquest's forecasts for and analysis of the EDA market, segmented by product type. Market data are preseneted in Figures 5.4.4-1 Revenue and 5.4.4-1 Shipments and Tables 5.4.4-1 and 5.4.4-2.

• Standalone revenue in 1985 was $317 million and will grow at an estimated 29 percent CAGR to reach $1,149 million in 1990.

• Standalone workstation shipments totaled 3,864 units in 1985 and are forecast to reach 32,421 units in 1990, growing at a CAGR of 53 percent.

• Revenue from host-dependent systems was $71 million in 1985 and is forecast to decline to $26 million in 1990, decreasing at a CAGR of

-18 percent.

• Host-dependent workstation shipments totaled 114 units in 1985 and are forecast to decrease at a 16 percent CAGR to 48 units in 1990.

• PC revenue in 1985 was $143 million and is expected to reach

$211 million in 1990, a CAGR of 8 percent.

• PC shipments totaled 10,089 units in 1985 and are forecast to grow at less than a 1 percent CAGR to reach 10,425 units in 1990.

• The EDA segment is by far dominated by revenue derived from standalone sales.

• Host-dependent products play virtually no role in the EDA segment for two reasons:

— Price-sensitivity and price-elasticity market requirements

— Distributed processing requirements with equal performance for all users

• The PC's major role will be in entry-level schematics entry products, with limited analysis capabilities.

• PCs with application-Specific hardware add-ons (i.e., coprocessors) will be capable of assuming more computationally intensive tasks.

• Networking, communications, and data base management are key issues with the large number of distributed systems.

• We believe that the growth rate of standalone systems will continually increase as a result of improved price/performance ratios, i.e., a decrease in average selling prices.

• Host-dependent systems will be used for batch analysis jobs and relieved of interactive graphics applications.

CCIS Markets © 1986 Dataquest Incorporated July 5.4.4-1

5.4.4 EDA Product Types

Figure 5.4.4-1 Revenue

EDA CAD/CAM by Product Type

Millions of Dollars

1400-

• Standalone

1200

• Host-Dependent

A Personal Computer

1000

800

600

400-

200

1985

1986 1987 1988 1990

Source: Dataquest

June 1986

5.4.4-2 1986 Dataquest Incorporated July

CCIS Markets

Figure 5.4.4-1 Shipments

EDA CAD/CAM by P r o d u c t Type

Workstation Shipnnents

36000

32000

A

Standalone

Host-Dependent

Persona) Computer

28000

24000

20000

16000

12000

— A —

5.4.4 EDA Product Types

4000

4

1985

*

1986

— f

1987

1968

• •

19SS

1990

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July 5.4.4-3

5.4.4 EDA P r o d u c t Types

T a b l e 5.4.4-1

EDA T u r n k e y

AppHcation b y P r o d u c t Type

(Millions of Dollars/Actual Units)

1985

1986

1987 1 9 ^ 1989 1990

CAG8

rota4 H«rleet

Ri^fenue

Systems

Wor testations

531

14.036

14.06a

» 2

18.705

18.733

764

22.785

22.817

940

27,767

27,803

1,138

34,287

34,320

1,354

42.873

42.895

20.6X

25. OX

25.OX

Standttone

R^wnue

Systens

(torkststions

317

3.864

3,864

416

6,606

6.606

532

9,874

9.874

698

15.063

15.063

902

22.414

22,414 t.149

32,421

32.421

29.4X

53.0X

53.

Hi»t-D^ependent

Revenue

S)^tens

ttor testations

71

83

114

49

61

90

43

58

90

39

55

90

33

44

77

26

26

48

Persorial Conputer

Rm^enue

Systens tterkstations

143

10.089

10. e ^

167

12.037

12.037

190

12,853

12.853

204

12.650

12,650

202

11,830

11,830

179

10,425

10.425

- 1 8 . »

-20.6X

-15.8X

4.6X

.7X

.7%.

SOURCE: B a t » | L f f i s t

June 1986

5.4.4-4 1986 Dataquest Incorporated July

CCIS Markets

Table 5.4.4-2

EDA Turnkey

Application by Product Type

(Percent of Total)

5.4.4 EDA Product Types

1985

1986

1987 1988

1989

1990

Standalone

Revenue

Systems

Workstations

Host-Dependent

Revenue

Systems

Workstations

Personal Computer

Revenue

Systems

Workstations

60X

28X

27X

66X

35X

35X

70X

43X

43X

74X

54X

54X

79X

65X

65X

85X

76X

76X

13%

IX

IX

27X

72X

72X

8X

OX

OX

26X

MX

64X

6X

OX

OX

25X

56X

56X

4X

OX

OX

22X

46X

45X

3X

OX

OX

18X

35X

34X

2X

OX

OX

13X

24X

24X

SOURCE: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

5.4.4-5

5.4.5 EDA Turnkey Average Prices

This section covers Dataquest's forecasts for and analysis of the average selling price per seat for an EDA turnkey system. Average selling prices are presented in

Figure 5.4.5-1 and Table 5.4.5-1.

• We expect the average selling price for all product types to decline from

$43,000 in 1985 to $22,800 in 1990, decreasing at a 12 percent CAGR, as a result of both the large number of vendors offering EDA capability and the industry-wide shift toward lower-cost workstations.

• We expect a 17 percent decrease in the average price per standalone seat, from $62,700 in 1985 to $25,200 in 1990. We believe that this will be a consequence of the introduction of lower-cost standalone workstations, as well as of a sharp decline in the price of EDA software, which we believe is becoming almost a commodity item in the EGAD market.

• Consistent with this shift, the average price per seat for host-dependent systems will decline at a CAGR of 16 percent, from $333,400 in 1985 to

$141,400 in 1990, according to our estimates. We also believe that the price/performance advantages of standalones and the popularity of personal computers are eroding the market for and the price of, host-dependent EDA workstations.

• We expect a 12 percent decline in the average price per seat for personal computers, from $25,300 to $13,600 in 1990. This will be the slowest decline for all product types and will be a result of two unique data management, computational, and communications requirements this application imposes on the personal computer.

CCIS Markets © 1986 Dataquest Incorporated July 5.4.5-1

5.4.5 EDA Turnkey Average Prices

Figure 5.4.5-1

EDA Turnkey

Average Price per Seat

Thousands of Dollars

320-

2 8 0 -

240-

2 0 0 -

1 6 0 T

. t 2 0 -

m-

40

i

k 4 i f l -

1985

I

1966

1

1987

m

1988

Standalone

Host-Dependent

Personal Computer

A -i.

1989

1990

Source: Dalaquesl

June 19S6

5.4.5-2

1986 Dataquest Incorporated July

CCIS Markets

5.4.5 EDA Turnkey Average Prices

Table 5.4.5-1

EDA Turnkey

Average Price per Seat

(Thousands of Dollars)

All Product Types

Standalone

Host-Dependent

Personal Computer

198S 1986 1987 1988 1989 1990 CAGR

43.0

62.7

333.4

25.3

38.3

48.3

298.0

22.7

33.7

41.1

247.5

20.7

29.7

34.9

205.4

18.4

26.0

29.7

170.3

16.0

22.8 -12%

25.2 -17X

141.4 -16%

13.6 -12%

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July 5.4.5-3

5.4.6 EDA Revenue Sources

This section covers Dataquest's forecasts for and analysis of the EDA market, segmented by source of revenue for each product type. Revenue data are presented in Figure 5.4.6-1 and Tables 5.4.6-1 and 5.4.6-2.

• We expect hardware revenue for all product types to decline from

53 percent of total revenue in 1985 to 42 percent in 1990.

• Software revenue, which accounted for 40 percent of total EDA revenue in

1985, will grow at a 25 percent CAGR to account for 47 percent of total

1990 revenue. We believe that this shift reflects increased emphasis on applications and data base management issues rather than on hardware platforms, which are becoming standardized.

• We expect service revenue to grow at a 32 percent CAGR between

1985 and 1990. We believe that this growth in service revenue reflects response to user demand for increased application support.

CCIS Markets © 1986 Dataquest Incorporated July 5.4.6-1

5.4.6 EDA Revenue Sources

Figure 5.4.6-1

EDA CAD/CAM

Revenue by Product Type

Millions of Dollars

720-

640-

A

Hardware

Software

Service t \

5 6 0 -

480-

400-

320-

240-

1 6 0 -

8 0 -

i

I:

0 -

1985

h '

1 1 1 1 -

1986 1987 1988 1989 1990

Source: Pataqu^st

JuiielB86

5.4.6-2

1986 Dataquest Incorporated July

CCIS Markets

Table 5.4.6-1

EDA CAD/CAM

Revenue by Product Type

(Millions of Dollars)

5.4.6 EDA Revenue Sources

A l l Product Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Computer

Hardware

Software

Service

Total

1985

1986 1987 1988 1989 1990

CAGR

282

212

37

531

336

252

44

632

394

315

56

764

462

403

75

940

521

512

104

1,138

563

642

149

1,354

15%

25%

32%

21%

149

141

27

317

204

177

35

416

254

230

47

532

321

311

66

698

391

416

95

902

456

552

141

1,149

25%

31%

39%

29%

40

24

7

71

25

19

5

49

21

17

5

43

17

17

5

39

12

16

5

33

7

15

5

26

30%

-10%

-8%

-18%

93

47

3

143

107

56

3

167

119

67

4

190

124

76

4

204

119

80

4

202

100

76

4

179

1%

10%

5%

5%

Source:

Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

5.4.6-3

5.4.6 EDA Revenue Sources

Table 5.4.6-2

EDA CAD/CAM

Revenue by Product Type

(Percent of Total)

All Product Types

Hiardware

Software

Service

Total

Standalone

Kardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Computer

Hardware

Software

" Service

Totai

1985

1986

1987

1988

1989 1990

53X

40X

7X

100X

53X

40X

7X

100X

52X

41X

7X

100X

49X

43X

8X

100X

46X

45X

9X

100X

42X

47X

11X

100X

47%

45%

8X

100X

49X

43X

8X

100X

48X

43X

9X

100X

46X

45X

9X

100X

43X

46X

11X

100X

40X

48X

12X

100X

56X

34X

10X

100X

51X

39X

10X

100X

48X

41X

11X

100X

44X

44X

12X

100X

37X

49X

14X

100X

26X

56X

18X

100X

65X

33X

2X

100X

64X

34X

2X

100X

63X

35X

2X

100X

61X

37X

2X

100X

59X

39X

2X

100X

56X

42X

2X

100X

Source: Dataquest

June 1986

5.4.6-4 1986 Dataquest Incorporated July

CCIS Markets

6.1 IC Definitions

DEFINiriONS

The Integrated Circuit (IC) CAD/CAM market segment comprises products that are used to create geometric descriptions of integrated circuits. The output of an IC

CAD system is data to be read by or formatted for a pattern generation device. By definition, an IC CAD system's output is pattern generation data.

The scope of the IC CAD segment includes the following types of products, functionalities, and methodologies:

• Mask geometry creation and editing

• Layout verification, including:

— Design rule checking

— Electrical rule checking

— Net list comparison

• Gate array place and route

• Cell place and route

• Silicon compilation

• PLA compilation

• Symbolic layout

• Spacing and compaction

Dataquest references two distinct classes of IC design methodology: handcrafted and automatic. Handcrafted IC design methodologies refer to products on which a layout designer physically creates the geometric description of the circuit's transistors based on a schematic typically created by an IC design engineer. Handcrafted design methodologies require extensive graphics editing capabilities, regardless of whether symbolic transistor representations are used.

Conversely, automatic IC design methodologies refer to products that will automatically create mask geometries based on logical or functional descriptions, without the manual intervention of a layout designer. Included in this subsegment are gate array or cell-based place and route products, silicon compilers, and PLA compilers. The distinguishing factor is the integration and close coupling of the logical and physical circuit descriptions.

CCIS Markets © 1986 Dataquest Incorporated July 6.1-1

6.1 IC Definitions

Dataquest differentiates ECAD products based on the system's output; either logical/functional net lists or physical descriptions. With the development and acceptance of automatic IC layout products—and by their definition they include close coupling and integration of logical or functional descriptions with physical descriptions--IC CAD products may include EDA functionality. Depending on the nature of the product and the degree of integration, an automatic IC CAD product may also include the ability to describe the chip's functionality. This description may be in the form of gate, functional, architectural, or language levels.

6A-2 © 1986 Dataquest Incorporated July CCIS Markets

6.2 IC Executive Summary

This summary highlights the key points and analyses discussed throughout this chapter. Please refer to the chapter in its entirety for a comprehensive analysis of the IC CAD/C/^M applications segment.

• The IC CAD market is growing from $198 million in 1985 to an estimated

$762 million in 1990, representing a 31 percent compound annual growth rate (CAGR).

• The scope of IC CAD products is quickly changing from high-priced, host-dependent, polygon-pusher systems to lower-priced, standalone systems that are coupled with front-end design and provide some degree of automatic layout.

• We expect the average selling price per seat to decrease 9 percent from

$92,100 to $58,900 between 1985 and 1990.

• Dataquest believes that design alternatives that focus on solutions to end-users' problems are essential for vendors selling IC CAD products.

• As the number of design alternatives increases, the segment is becoming crowded with vendors, implying that:

— Traditional vendors' market share positions are being challenged and threatened

— Relationships with silicon manufacturers are critical to IC design

-- Product lines need to be broad and deep to keep pace with integrated circuit alternatives

CCIS Markets © 1986 Dataquest Incorporated July 6.2-1

6.3 IC Market Overview

HISTORY

Evolution

Unlike any other CAD/CAM application, IC CAD is required for integrated circuit product design. Virtually no VLSI can be designed without the use of CAD in some form or another. The sophistication, complexity, and capabilities of

IC CAD/CAM products must maintain equal or near pace with the nature of the products being designed.

Gordon Moore of Intel Corporation has a theory that the number of transistors per integrated circuit doubles approximately every two years, and IC CAD/CAM products, too, have evolved in that way. From the early 1970s, IC CAD systems have evolved from comparatively simple digitizing systems to "polygon-pushers" with full manual editing functionalities of the late 1970s and early 1980s, and from these products to the current sophisticated placement and routing products for application-specific integrated circuits (ASICs). Today, commercially available silicon compilers are adding yet another dimension to the complexity and sophistication of IC CAD/CAM tools.

Shifts in Focus

The IC CAD segment has long been dominated by Applicon, Calma, and

Computervision with their "polygon-pushers" and manual editing systems.

However, systems offering automated design methodology alternatives, particularly for gate array and cell-based implementations, are gaining in popularity.

IC CAD vendors have neglected the logical and functional IC design issues by primarily focusing on physical layout or mask geometries. Product development and enhancements have tended to concentrate on layout and performance issues, such as:

• Graphics

• Editing

• Design rule checking

• Pattern generation

• General program operations

However, by virtually ignoring design automation solutions for IC design engineers, traditional IC CAD vendors have neglected to protect their customer bases by not providing a continuous stream of new and related products. As a result, several new companies were formed to address specifically electronic design

CCIS Markets © 1986 Dataquest Incorporated July 6.3-1

6.3 IC Market Overview automation (EDA) applications. These companies—particularly Daisy, Mentor, and

Valid—have provided front-end engineering design automation solutions to the customer bases of the traditional IC CAD vendors, thus eroding the traditional vendors' customer bases.

Pricmg Umbrellas

Average system and workstation prices have historically been on the high side, for several reasons:

• Unavailability of lower-priced hardware with adequate performance and storage capacity

• A critical requirement for CAD, with no alternative methodologies or products

• Relatively few competing vendors

/ ^ umbrella was created for new products and vendors to enter the market with lower-priced solutions due to what seemed unreasonably priced products. As a result, several new companies were formed with lower average selling prices as their main product strategies. However, the market leaders' dominance prevailed.

Those entering the market on a price basis alone discovered that they could not compete effectively against the established vendors, at least not to any meaningful degree. The three companies that entered the market segment with lower prices as their primary differentiation were Avera, Metheus, and Via. Avera is now out of business, and Metheus and Via have redefined their product strategies so that price is no longer their primary product differentiation.

THE PRESENT

IC CAD products are no longer available from a limited number of vendors.

Newly established entrants bring new ideas—methodologies, interfaces, strategic alliances, hardware platforms—to a market that was formerly dominated by three vendors. With nearly 20 companies currently offering IC physical layout solutions,

IC CAD is no longer considered magical or mystical—just difficult.

Automatic Layout

Traditional IC CAD vendors failed to react quickly to the marketing opportunities for ASIC design and layout tools. Dataquest believes that this occurred for several reasons:

• Primary focus on performance enhancements to manual editing functions and related analysis

6.3-2 © 1986 Dataquest Incorporated July CCIS Markets

6.3 IC Market Overview

• Lack of integrated and closely coupled front-end EDA products

• Concentration on the solution, not the problem

As such, end-users' ASIC CAD needs were first addressed by companies other than the traditional vendors.

The high degree of expertise and knowledge required to develop ASIC CAD products brought about yet another rash of companies—both semiconductor companies and CAD vendors—entering the IC CAD segment.

Methodology

With new companies come new design methodologies. The IC CAD market has evolved from one commercially available methodology—manual editing—to a variety of choices. The choice of design methodology is due in part to the ASIC market itself, as well as to evolving CAD techniques. Dataquest tracks three major

IC design methodologies:

• Manual editing

• Place and route

• Silicon compilation

Each methodology offers users varying degrees of automation, integration, process dependence, and creativity, /^aiyses and forecasts for each of the above methodologies will be published in subsequent Dataquest newsletters and service sections.

A Buyer's Market

In only five short years, the number of vendors selling IC layout solutions has increased dramatically. Dataquest recognizes three distinct groups of companies offering layout solutions. These groups are listed below, with a representative sample of companies in each classification:

• Traditional

— Applicon

— Calma

— Computervision

CCIS Markets © 1986 Dataquest Incorporated July 6.3-3

6.3 IC Maiitet Overview

• Fundtionality challengers

— Daisy

— Ment(M"

— SDA

— Seattle Silioon

— Silicon Coitq)ilers

— Silicon £}esign Labs

Silvar-Listx)

— Tar^eitt

— Valid

• Semiconductor companies

— AMI

— IMP

— LSI Logic

— VLSI Technology

Each type of a>mpany offers its users distinct, although sometimes overlapping, advanteges and disadvantages, as described in Table 6.3-1.

6.3-4 © 1986 Bataquest; Incoiporated July CCIS Markets

6.3 IC Market Overview

Table 6.3-1

Strengths and Weaknesses of

IC CAD Companies by Classification

Company Type

Traditional

Functionality

Challengers

Strengths

Large installed base

Manual editing

PG interfaces

Mature and stabilized products

EDA integration

Assorted methodologies

ASIC focus

Foundry interfaces

Hardware platforms

Process expertise

EDA integration

Manufacturability guarantee

Weaknesses

Automatic layout

Young and evolving products

Semiconductor

Process dependent

Few manufacturing alternatives

Design security

Source: Dataquest

June 1986

Hardware Platforms

Hardware platforms have begun to play an important role in penetrating the end-user market. As recently as two years ago, almost 100 percent of IC CAD systems shipments were based on host-dependent architectures. (Refer to

Section 6.4.1 for Dataquest forecasts and analysis of the IC CAD segment by product type.)

Standalone Workstations

With the introduction of standalone workstations for IC applications came the inherent benefits of standalones, listed below:

• Lower incremental cost, thus more affordability

• Distributed processing, thus maintaining constant performance levels regardless of the number of users (except in the case of large file transfers)

• Computational alignment, thus delegating design responsibilities according to system performance capabilities

CCIS Markets 1986 Dataquest Incorporated July

6.3-5

6.3 IC Market Overview

Nearly all of the functionality challengers offer standalone product architectures, as do most semiconductor challengers. In response to competition,

Calma and Computervision now offer standalone workstations in addition to their traditional host-dependent systems.

Dataquest believes that standalone workstations will continue to play an increasing role in IC CAD applications; however, we recognize that they are not without their limitations, as listed below:

• Inadequate for placing and routing large circuits

• Slow when transferring large design files between engineers and layout designers

Host Dependent

Although host-dependent systems will continue to be used for IC design,

Dataquest estimates that by 1990 they will account for only 2 percent of all

IC CAD revenue, declining from 50 percent in 1985. We believe that host-dependent products will be used mainly as computational engines, especially for automatic layout applications.

However, with the introduction of Digital's MicroV/^ II, IBM's RT PC, and

Apollo's DN3000, Dataquest believes that there are very few host-dependent alternatives, except for IBM and its 4300 and 308X series.

Personal Computers

Due to large IC design data bases and their extensive storage requirements,

Dataquest believes that personal computers will not play a major role in the

IC CAD segment. Furthermore, due to the design process itself, it is difficult to partition the design into sizes small enough to be managed by personal computers.

We believe that the present role of the personal computer is limited to the design or compilation of programmable logic arrays (PLAs), because these devices are typically small enough to be handled by a personal computer.

To further substantiate this point, we know of isolated cases where it is possible to run efficiently IC CAD programs on a PC. However, because the value of the software disproportionately exceeds the value of the hardware, we do not believe that vendors will be able to receive an adequate return on their R&D, support, marketing, and sales investments to justify pursuing the PC as a viable hardware alternative.

Although we recognize that there will be exceptions, we believe that the majority of ICs will not be physically designed on a PC, even though at the logical level they could be designed on a FC.

6.3-6 © 1986 Dataquest Incorporated July CCIS Markets

6.3 IC Market Overview

TRENDS

The market will continue to explore and develop products for new design methodologies. In general, any company considering entering the IC CAD segment and developing an IC CAD tool must provide an automated solution with clearly defined productivity benefits.

Because of highly automated and integrated layout tools, the layout design cycle bottleneck once again is decreasing. As such, Dataquest believes that a secondary focus (second to methodology) will concentrate on developing layout and layout analysis tools that improve on one or more of the following:

• Hierarchical data bases

• Logic, transistor, test, and layout integration

• Interactive place, route, simulation, and analysis

• Improved graphics and processing performance

• Project management and revision control

• Physical as well as behavioral model libraries

User-Controlled Layout

Dataquest believes that silicon manufacturers will begin to rely more on the users and the users' systems to perform layout. However, we believe that this will happen over time, as the following events occur:

• Layout programs stabilize to the point that they can be maintained, supported, and documented

• Process-independent programs incorporate enough process information to produce manufacturable circuits

• More users feel secure that they actually can perform layout, especially users that are not among the elite group of experienced IC designers

• Users feel confident regarding the manufacturability of a circuit in which they performed the layout

• Hardware performance increases and provides acceptable levels of interaction and response times

CCIS Markets © 1986 Dataquest Incorporated July 6.3-7

6.3 IC Market Overview

Third-Party Deals

Due to large R&D investments and expenses required for IC layout product development, we believe that more and more niche products will appear and succeed in the marketplace. Niche products may take the form of a layout methodology, routing, layout verification, or interfaces between IC design cycles.

Dataquest believes that most niche companies will opt for third-party distribution agreements out of necessity, due to large distribution expenses.

However, we do not believe that a third-party agreement with any one particular company is a long-term competitive advantage for the mainstream IC CAD vendor, because of:

• The nature of niche companies and their need for distribution alternatives

• The fact that competitors will soon have the same product, or at least the same functionality, thus negating any advantage

Expanded Functionality

As all electronic CAD segments improve in terms of user acceptance, human engineering, connectivity, performance, and functionality, Dataquest believes that design data bases for both integrated circuits and printed circuits will merge into one. We believe that ASICs are the primary reason that this phenomenon will occur.

Future applications products, especially PCBs, will have to interface with

IC products at some level so that the pins, power requirements, and performance of the custom IC can be integrated and simulated during printed circuit board design.

Dataquest believes that prime candidates to address this phenomenon will be companies that already have both custom IC and PCB applications product lines, due to the large development, support, and marketing efforts required of each application.

6.3-8 ' © 1986 Dataquest Incorporated July CCIS Markets

6.4.1 Total IC CAD/CAM

This section covers the total integrated circuit (IC) CAD/CAM market for all regions and product types and refers to Figures 6.4.1-1 Revenue and

6.4.1-1 Shipments and Table 6.4.1-1.

• The IC segment reached an estimated $198 million in 1985 and is forecast to grow to $762 million in 1990, at a compound annual growth rate of

31 percent.

• Dataquest estimates that revenue will increase 16 percent in 1986, reaching

$230 million.

• Workstation shipments in 1985 were an estimated 1,419 units; shipments are expected to reach 8,945 units in 1990, growing at a 45 percent CAGR.

CCIS Markets © 1986 Dataquest Incorporated July 6.4.1-1

6.4.1 Total IC CAD/CAM

Figure 6.4.1-1 Revenue

IC CAD/CAM-Worldwide

400

320

240

160

80-

M i l l i o n s of D o l l a r s

800

720-

640-

560

480

^ ^

^km

1985 1966 xwv'i

C$'^>^

>Kw<

vS \ . \ . v

S,\>/'*.V

NV'^V%

XN^VV

,\."V-^.\"

. \ ? ^ , X ^

\ W O

V V V . " v " \

1987 1988

"'W$

^1

^

\

K\

;'\w

% '%. *• "i ^ x.^^.w,. %

1969

LV^V'vS

1

1990

Source: Dataquest

June 1986

6.4.1-2 1986 Dataquest Incorporated July

CCIS Markets

6.4.1 Total IC CAD/CAM

Workstation Shipments

10000

9000

8000

7000

6000

5000

4000

3000

2000

1000

1985 1986

Figure 6.4.1-1 Shipments

IC C A D / C A M - W o r l d w i d e

1987 19SS 1989 1990

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

6.4.1-3

6.4.1 Total IC CAD/CAM

Table 6.4.1-1

IC C A D / C A M - W o r l d w i d e

(Millions of Dollars/Actual Units)

1985 1986 1987 1988 1989 1990 CAGR

Total Market

Revenue

Systeins

Uorlcstations

198

1,196

1,419

230

1,753

1,950

292

2,723

2,881

392

4,164

4,280

543

6.121

6,197

762 30.9%

8,903 49.4%

8,945 44.5%

Source: Dataquest

June 1986

6-4-1-4 © 1986 Dataquest Incorporated July CCIS Markets

6.4.2 IC Market Shares

This section includes Dataquest's forecasts and analysis of the IC CAD/CAM market share distribution and refers to Figure 6.4.2-1 and Table 6.4.2-1.

• Calma continues to lead the IC CAD market in terms of revenue and system shipments, with nearly a 28 percent market share, down from

42 percent in 1984.

• Daisy moved into second place in 1985 with its market share estimated at approximately 14 percent.

• Applicon, the number two market leader in 1984, slipped to number six with a 2.3 percent market share in 1985.

• Computervision ranked number three, with approximately a 9 percent share of the 1985 market.

• As the market moves toward higher degrees of automation and integration,

Dataquest believes that the market shares of the traditional IC CAD vendors (Applicon, Calma, and Computervision) are being eroded.

• Daisy, Mentor, and Valid are carving away at the traditional IC CAD positions of Applicon, Calma, and Computervision due to their standalone or automatic layout products.

• We expect new product announcements incorporating more automatic layout functionality and tightly coupled front-end design functions from virtually all IC CAJD vendors.

CCIS Markets © 1986 Dataquest Incorporated July 6.4.2-1

d.4.2 IC Market Shares

Figure 6.4.2-1

IC Market ShareWorldwide

1985

Tektronix

1.6%

Scientific

Caicuiatlons

1.7%

Appllcon

2 . 3 %

Control Data

2 . 3 %

Silvar-Llsco

3.7%

Source: Dataquest

June 1986

6.4.2-2 1986 Dataquest Incorporated July CCIS Markets

Table 6.4.2-1

IC M a r k e t Share—Worldwide

(Millions of Dollars)

6.4.2 IC M a r k e t Shares

COMPANY

=======

Calma

Daisy

Computervision

Mentor

Valid

Silvar-Lisco

Control Data

Applicon

Scientific

CalI

Tektronix

Racal-Redac

Other

CoInputer Companies

Other Far East

CoIipanies

All Companies

1985

REVENUE

55

27

18

10

8

7

5

5

3

3

1

1

21

35

198

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

1985

SHARE

=====

27.7%

13.6%

8.9%

5.0%

4.1%

3.7%

2.3%

2.3%

1.7%

1.6%

.3%

.3%

10.8%

17.7%

100.0%

'••

Source:

Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

6.4.2-3

^.4.2 IC Market Shares

(Page intentionally left blank)

6.4.2-4 © 1986 Dataquest Incorporated July CCIS Markets

6.4.3 IC Regions

This section includes Dataquest's forecasts and analysis of the IC CAD/CAM market segmented by region and refers to Figures 6.4.3-1 Revenue and

6.4.3-1 Shipments and Tables 6.4.3-1 and 6.4.3-2.

• North American CAD/C/^M revenues were $123 million in 1985 and are forecast to grow to $473 million in 1990, at a 31 percent CAGR.

• In 1985, European CAD/CAM revenues were $37 million and, growing at a

CAGR of 31 percent, are expected to reach $143 million in 1990.

• Far Eastern CAD/CAM revenues were $35 million in 1985 and are forecast to grow to $135 million in 1990, at a 31 percent CAGR.

• The rest of the world consumed $3 million worth of CAD/CAM in 1985, and revenues are forecast to grow at a 31 percent CAGR to reach

$12 million in 1990.

• Dataquest believes that North America will dominate consumption of

IC CAD systems through 1990, with a relatively constant 62 percent of worldwide shipments.

• The Far East, with 18 percent of worldwide consumption, is not forecast to increase due to the large amount of in-house-developed software used by the major IC manufacturers.

• Although the majority of vendors are actively establishing non-U.S. marketing organizations if they have not already, Dataquest does not anticipate any major shifts in current worldwide consumption of IC CAD systems, basically due to the distribution of IC manufacturers and consumption of ICs.

• We expect Europe to maintain a fairly constant 19 percent of worldwide shipments and consumption.

• IC manufacturers, particularly in Japan, tend to regard CAD tools as a proprietary, competitive advantage, as they do general manufacturing processes.

CCIS Markets © 1986 Dataquest Incorporated July 6.4.3-1.

6.4.3 IC Regions

Millions of Dollars

500

Figure 6.4.3-1 Revenue

IC CAD/CAM by Region

198S 19SS

1987 1968 1989 1990

Source; Dataquest

June 1986

6.4.3-2

1986 Dataquest Incorporated July

CCIS Markets

6.4.3 IC Regions

Figure 6.4.3-1 Shipments

IC CAD/CAM by Region

3 0 0 0 -

2400-

1800-

1200-

600-

0>

t

s

1985

Workstation Shipments

5400-

4800-

X

North America

Europe

Far East

ROW

4200-

3 6 0 0 -

\(

j ^ —

1986

X

V

19S7

X

1988

¥. >:

\

1989 1390

Source: Dataquest

Juue 19S6

CCIS Markets

1986 Dataquest Incorporated July

6.4.3-3

6.4.3 IC Regions

Table 6.4.3-1

IC CAD/CAM

Application by Region

(Millions of Dollars/Actual Units)

1985

1986

1987

1988

1989 1990

CAGR

Total Market

Revenue

Systems

Workstations

198

1,196

1,419

230

1,753

1,950

292

2,723

2,881

392

4,164

4,280

543

6,121

6,197

762

8,903

8,945

30.9%

49.4X

44.5X

North America

Revenue

Systems

Workstations

123

811

898

143

1.127

1,239

181

1,665

1.770

243

2,560

2,639

337

3.780

3,832

473

5.513

5.540

30.9X

46.7X

43.9X

Europe

Revenue

Systems

Workstations

Far East

Revenue

Systems

Workstations

Rest of World

Revenue

Systems

Workstations

37

213

237

35

158

267

3

14

17

43

345

381

41

251

298

4

30

32

54

534

562

51

478

502

5

46

47

73

797

821

69

738

750

6

69

70

102

1.155

1,173

96

1,085

1,091

9

101

101

143

1,665

1,677

135

1,579

1,583

12

146

146

31 .OX

50.9X

48. OX

31 .OX

58.5X

42.7X

30.9X

58.9X

53.3X

Source:

Dataquest

June 1986

6.4.3-4

1986 Dataquest Incorporated July

CCIS Markets

6.4.3 IC Regions

T a b l e 6.4.3-2

IC CAD/CAM

Application by Region

( P e r c e n t of Total)

North America

Reveiuie

Systems

Workstations

Europe

Revenue

Systems

Workstations

Far East

Revenue

Systems

Workstations

Rest of World

Revenue

Systems

Workstations

1985

=s==

62X

68X

63%

1986 s===

62X

64X

64X

1987

5 S S S

62X

61X

61X

1988

===s

62X

61X

62X

1989

====

62X

62X

62X

1990

===s

62X

62X

62X

19X

18X

17X

18%

13X

19X

2X

1X

1X

19X

20X

20X

18X

UX

1SX

2X

2X

2X

19X

20X

20X

18X

18X

17X

2X

2X

2X

19X

19X

19X

18X

18X

18X

2X

2X

2X

19X

19X

19X

18X

18X

18X

2X

2X

2X

19%

19X

19X

18%

18%

18X

2X

2X

2X

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

6.4.3-5

6.4.4 IC Product Types

This section includes Dataquest's forecasts and analysis of the IC CAD/CAM market segmented by product type and refers to Figures 6.4.4-1 Revenue and

6.4.4-1 Shipments and Tables 6.4.4-1 and 6.4.4-2.

• The IC CAD market reached $198 million in 1985, and is forecast to grow at a 31 percent CAGR to $720 million in 1990.

• Approximately 1,419 workstation units shipped in 1985 and, growing at a

45 percent CAGR, we estimate that 8,945 workstations will be shipped in

1990.

• Standalone revenues were $97 million in 1985, and are forecast to reach

$739 million in 1990, growing at 50 percent compounded annually.

• Approximately 917 standalone workstations were shipped in 1985, and are forecast to reach 8,416 workstation shipments in 1990, growing at

56 percent compounded annually.

• Host-dependent revenues were $99 million in 1985, and revenues are forecast to decrease at 31 percent CAGR through 1990, declining to

$15 million.

• Host-dependent workstation shipments were 397 in 1985, and are forecast to decrease at 32 percent CAGR to 67 units shipped in 1990.

• Personal computer revenues were $2 million in 1985 and, growing at

32 percent compounded annually, are forecast to reach $8 million in 1990.

• An estimated 106 personal computers were shipped in 1985, and are expected to reach 462 units in 1990, growing at a 34 percent CAGR.

• Standalone system shipments surpassed host-dependent systems in

1985 due to lower costs per seat and less CPU degradation when performing graphics-intensive tasks.

• Revenues of standalone products will not surpass host-dependent revenues until 1986 due to lower cost per seat.

• Host-dependent systems will continue to be used due to large and computational-intensive processing requirements.

• Host-dependent systems' primary application will be design programs and methodologies that do not require extensive interactivity and that can run in background mode.

CCIS Markets © 1986 Dataquest Incorporated July 6.4.4-1

6.4.4 IC Product Types

• Personal computers will not be a major factor because of the inherent computational-intensive design tasks and large data bases. Dataquest believes that PCs will be used primarily for compilation of programmable logic arrays (PLAs).

• For the foreseeable future, personal computers will be used to serve as front-end (EDA) logic design entry systems for ICs, not for physical layout.

• Workstation performance is a key issue, especially the available disk drive and memory space, due to the large data bases involved.

• Graphics requirements are not as intensive as in mechanical or solids modeling applications. While not needing the high resolutions required by those applications, electronic CAD/CAM graphics do need near to real-time display and response speeds.

6.4.4-2 © 1986 Dataquest Incorporated July CCIS Markets

6.4.4 IC Product Types

480

400-

320

240

160-

Figure 6.4.4-1 Revenue

IC CAD/CAM by Product Type—Worldwide

Millions of Dollars

720

640

• Standalone

• Host-Dependent

^ Personal Computer

560

1985

1986 1987 1988

1989

1990

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July

6.4.4-3

6.4.4 IC Product Types

5000-

4000-

3000-

2000-

1000,

t

n^

I — —

1985

Figure 6.4.4-1 Shipments

IC CAD/CAM by Product Type—Worldwide

Workstation Shipments

8000-

A

Standalone

Host-Dependent

Personal Computer

7000-

6000^

• - m

^ * ~

_^ "•

1

1986 1987 IQSS

A

1969

• ^

• i

(1

1

1990

Source: Dataquest

June 1986

6.4.4-4 1986 Dataquest Incorporated July

CCIS Markets

6.4.4 IC P r o d u c t Types

Table 6.4.4-1

IC C A D / C A M - W o r l d w i d e

Application by P r o d u c t Type

(Millions of Dollars/Actual Units)

1985 1986 1987 1988 1989 1990

CAGR

Total Marlcet

Revenue

Systems

Workstations

Standalone

Revenue

Systems

Workstations

Host-Dependent

Revenue

Systems

Workstations

Personal Computer

Revenue

Systems

Workstations

198

1,196

1,419

230

1,753

1,950

292

2.723

2,881

392

4,164

4,280

543

6,121

6,197

762

8,903

8,945

30.9X

49.4%

44.5%

97

917

917

99

174

397

2

106

106

137

1,364

1,364

88

200

396

5

189

189

225

2,344

2,344

61

143

302

5

235

235

346

3,742

3,742

39

93

208

7

330

330

510

5,672

5,672

25

54

131

8

395

395

739

8,416

8,416

15

25

67

8

462

462

5 0 . n

55.8%

55.8%

-31.4%

-32.0%

-29.9%

31.9%

34.3%

34.3%

SOURCE: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

6.4.4-5

6.4.4 IC Product Types

Table 6.4.4-2

IC CAD/CAM-Worldwide

Application by P r o d u c t Type

(Percent of Total)

1985 1986 1987 1988 1989 1990

Stam^ione

RevenL«

Systems

Workstations

Host'D^)endent fievenue

Systems

Uorlcs tat ions

Personal Conputer

Revenue

Systems

Workstations

49%

77%

65%

60%

78%

70%

77%

86%

81%

88%

90%

87%

94%

93%

92%

97X

95%

94%

SOX

15%

28%

1%

9%

7%

38%

11%

20%

2%

11%

10%

21%

5%

10%

2%

9%

8%

10%

2%

5%

2%

8%

8%

5%

IX

2%

1%

6X

6%

2%

0%

1%

1%

5%

5X

SOURCE: Dataquest

June 1986

6.4.4-6

1986 Dataquest Incorporated July

CCIS Markets

6.4.5 IC Turnkey Average Prices

This section includes Dataquest's forecasts and analysis of the average selling price per seat of IC turnkey systems and refers to Figure 6.4.5-1 and Table 6.4.5-1.

• The average selling price for all product types is expected to decline from

$92,100 to $58,900, at a relatively slow rate of 8 percent CAGR between

1985 and 1990, which reflects both the increasingly sophisticated and complex nature of IC design software, as well as the intensive computational requirements of this application.

• The 8 percent decline in average selling price per seat is greatest in absolute dollars among host-dependent systems, from $199,700 in 1985 to

$83,000 in 1990. This reflects the industry-wide preference for lower-cost,

Standalone systems vis-a-vis the continuing necessity for this product type in fuU-custom IC design.

• The decline in price per seat is slowest among standalone workstations, decreasing at 5 percent CAGR between 1985 and 1990 from an average of almost $79,500 in 1985 to $61,100 in 1990, which we believe results from increasing demand for this product type.

• The 7 percent decline in price per seat for personal computer systems from

$24,000 in 1985 to $16,300 in 1990, is below the average due to its limited applicability in IC design, as well as the high component cost of IC design software.

CCIS Markets © 1986 Dataquest Incorporated July 6.4.5-1

6.4.5 IC Turnkey Average Prices

Figure 6.4.5-1

IC Turnkey—Worldwide

Average Price Per Seat

Thousands of Dollars

2 1 0 -

180-

• Standalone

• Host-Dependent

A Personal Computer

130

120

30

1985

1986

1987 1988

19S9 1990

Source: Dataquest

June 1986

6.4.5-2 1986 Dataquest Incorporated July

CCIS Markets

Table 6.4.5-1

IC Turnkey—Worldwide

Average Price per Seat

(Thousands of Dollars)

6.4.5 IC Turnkey Average Prices

All Product Types

Standalone

Host'Depeixlent

Personal Coniputer

1985 1986 1987 1988 1989 1990 CAGR

92.1

79.5

199.7

24.0

85.1

75.8

U 9 . 6

22.3

73.7

72.0

129.8

20.9

66.7

68.4

112.1

19.4

62.6

65.0

96.8

17.9

58.9 - 8 %

61.1 -5%

83.0 -16%

16.3 -7%

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July 6.4.5-3

6.4.6 IC Revenue Source

This section includes Dataquest's forecasts and analysis of the IC market segmented by source of revenue for each product type and refers to

Figure 6.4.6-1 and Tables 6.4.6-1 and 6.4.6-2.

• Hardware, as a source of revenue for all product types, is forecast to decline from 50 percent of revenues in 1985 to 36 percent in 1990.

• Software revenues, which accounted for 36 percent of total IC CAD revenues in 1985, are expected to grow at a 38 percent CAGR, to account for 47 percent of total 1990 revenue. Dataquest believes that this shift reflects increased emphasis on applications and functionality rather than on hardware platforms that are standardizing.

• We believe that service revenues will grow at a 36 percent CAGR between

1985 and 1990, due to, among other reasons, the increasing application support required for ASIC design.

CCIS Markets © 1986 Dataquest Incorporated July 6.4.6-1

6.4.6 IC Revenue Source

280-

240-

200-

160-

120-

80

4 0 -

i

c

0 -

1985

Figure 6.4.6-1

IC CAD/CAM-Worldwide

Applications by Revenue Source

Millions of Dollars

360-

320

Hardware i ,

Software /

Service /

^

1 1 1 1

1966

1987 1986 1989 1990

Source: Dataquest

June 1986

6.4.6-2 1986 Dataquest Incorporated July

CCIS Markets

6.4.6 IC Revenue Source

T a b l e 6.4.6-1

I C C A D / C A M - W o r l d w i d e

Applications by R e v e n u e Source

(Millions of Dollars)

All Product Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Conputer

Hardware

Software

Service

Total

1985

1986 1987

1988 1989

1990

CAGR

99

71

28

198

112

87

32

230

134

118

40

292

169

169

54

392

217

245

81

543

275

360

128

762

23%

38%

36%

31%

44

41

12

97

63

58

16

137

100

97

28

225

147

153

46

346

203

233

74

510

267

350

122

739

43%

53%

60%

50%

54

29

16

99

47

27

15

88

30

19

11

61

18

13

8

39

9

9

7

25

4

6

5

15

•40%

-28%

•20%

31%

1

1

0

2

2

2

0

5

3

2

0

5

4

3

0

7

4

4

0

8

4

4

0

8

28%

36%

32%

32%

Source:

Dataquest

June 1986

C C I S M a r k e t s

1 9 8 6 Dataquest Incorporated July

6.4.6-3

6.4.6 IC Revenue Source

Table 6.4.6-2

IC CAD/CAM-Worldwide

Applications by Revenue Source

(Percent of Total)

All Product Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Computer

Hardware

Software

Service

Total

1985

1986 1987

1988 1989

1990

SOX

36X

14X

100X

49X

38X

UX

100X

46X

41X

14X

100X

43X

43X

14X

100X

40X

45X

15X

100X

36X

47X

17X

100X

45X

43X

12X

100X

46X

42X

12X

100X

45%

43X

12%

100X

43X

44X

13%

100X

40X

46X

15X

100X

36X

47X

17X

100X

54X

29X

16X

100X

53X

30X

17X

100X

SOX

32X

18X

100X

46X

33X

21X

100X

38X

36X

26X

100X

27X

38X

3SX

100X

53X

43X

5X

100X

52X

42X

5X

100X

52X

44X

5X

100X

SOX

4SX

5X

100X

49X

47X

5X

100X

46X

49X

5X

100X

Source: Dataquest

June 1986

6.4.6-4

1986 Dataquest Incorporated July

CCIS Markets

7.1 PCB Definitions

DEFINITION

The printed circuit board (PCB) CAD/CAM applications segment refers to

CAD/CAM systems used to design printed circuit boards. Until recently, the functionality of PCB systems was limited to the physical layout or description of the board. Now, however, their functionality has expanded to include comprehensive logic design and analysis of PC boards. PCB CAD systems are typicaliy used by drafters to create the layout of the traces and components to be placed on the board.

The output of a PCB system is the graphic description of the board's layout, which is used in various manufacturing stages. Output typically consists of the following:

• Photoplotter tapes

• Silk screens

• Insertion drawings

• Numeric control drill tapes

Design methodologies range from manual drafting systems to highly automated place and route systems. Manual systems require a drafting person to physically place components on the graphic representation of the board and interactively route each of the traces or connections. Automatic PCB systems vary in the degree to which the system will automatically place and route the components and traces.

However, all automatic products work directly from the logical description of the board's functionality.

By definition, PCB output is manufacturing data. Because of automatic layout systems, including the integration and close coupling of logical and physical data,

PCB products may also include EDA functionality.

CCIS Markets © 1986 Dataquest Incorporated July 7.1-1

7.1 PCB Definitions

(Page intentionally left blank)

7.1-2 © 1986 Dataquest Incorporated July CCIS Markets

7.2 PCB Executive Summary

This summary highlights the key points and analyses discussed throughout this chapter. Please refer to the chapter in its entirety for a comprehensive analysis of the PCB applications segment.

• The PCB segment grew 34 percent in 1985, reaching $477 million in revenue, compared with $355 million in 1984.

The segment grew despite the slump in the general electronics industry, i.e., among the end users of PCB systems.

• Companies experiencing the strongest revenue growth in 1985 were those that sell distributed processing systems based on personal computers or standalone workstations that are tightly coupled to EDA applications.

• Because the PC AT replacement product is expected to have a 32-bit microprocessor, we believe that 16-bit PC shipments will give way to higher-performance standalone workstations.

• Integration with EDA applications is critical for long-term survival.

• The value of software will increase more sharply than hardware; Data quest forecasts that in 1990, 35 percent of revenue will come from software products.

• We forecast that hardware will fall to 44 percent of revenue in 1990, remaining that high because of an increase in application-specific hardware sales.

CCIS Markets © 1986 Dataquest Incorporated July 7.2-1

7.3 PCB Market Overview

HISTORY

PC drafters have long used PCB CAD systems to create board geometries.

However, systems have gone through many phases prior to reaching their present day functionality. These phases are as follows:

• Early 1970s—/\rtwork-only systems, on which designers manually placed all components and drew traces. Artwork-only systems were both standalone and host-dependent architectures and were priced in excess of

$150,000.

• Late 1970s—Combinations of batch automatic place and/or route systems.

These systems were often awkward and difficult to use, rarely resulting in

100 percent routing completion. Systems of this type were generally host-dependent and were priced in the $500,000 range.

• 1980—Reentrant automatic place and routing systems. While still relatively awkward to use, they did allow designer intervention. They were generally host-dependent, and still priced in the $500,000 range when fully configured. They had improved graphics capabilities.

• 1982—16-bit Standalone architectures, which mostly used manual methods and had little automatic place and route capability. Depending on design method, prices ranged from $90,000 to $175,000.

• 1983—PC-based systems, which were basically artwork-only methods.

Prices ranged from $8,500 to $15,000 depending on the PC configuration and the complexity of drafting software and its interfaces.

• 1984—Automatic and reentrant place and route on 16/32-bit standalone architectures with good interactive graphics. They were priced between

$75,000 and $150,000. Vendors started to incorporate EDA functionality.

• 1985—PC-based systems with automatic and reentrant place and route software, some with EDA functionality. Prices ranged from $10,000 to

$20,000.

Although these transitions occurred over the past 15 years, the most innovative development activity has taken place in the last four years. Dataquest believes that the last four years have experienced the most change for several reasons:

• Increasing board complexity, size, density, and functionality created a need for more powerful and flexible CAD products.

• CAD hardware and software developments occurred that allowed these boards to be designed at a cost acceptable to a price-sensitive market.

CCIS Markets © 1986 Dataquest Incorporated July 7.3-1

7.3 FOB Market Overview

Because of the previous PCB systems' high price tags and their reputations of being not so easy to use, target markets were limited to those companies that had to have CAD systems. There remained large and untapped markets that could buy if the price was low enough and the system was functionally "easy" to use by designers and drafters who spent a large portion of their time doing tasks other than creating PC boards.

Finally came the global imperative to become more productive. The realization that CAD is an integral part of a high order process to streamline operations, coupled with the demands of high-technology competition and shortening product life cycles, created opportunities for users to demand and vendors to deliver.

The PCB segment comprises diverse solutions for integration, automation, and hardware. The market leaders in the late 1970s—Applicon, Calma, Computervision,

Gerber Scientific, Racal-Redac, and Scientific Calculations—had holes in their product lines and strategies that other companies sought to fill. As new entrants began to introduce and deliver solutions, the old guard leaders began to revitalize their product lines. The results are the diverse solutions described in the next three sections.

INTEGRATION

The electronic product design process neither starts nor ends with printed circuit board design. The electronic portion of the product in which the board will be used must first be conceptualized, designed, and analyzed. Then the board itself must be laid out and verified. And finally, the mechanical design in which the board will be placed must be designed. This process is not a serial one, although many CAD systems of yore approached the design process serially with isolated and discrete products.

Electronic Integration

Dataquest believes that the integration of EDA functionalities into the PCB design process is imperative for the long-term success of the CAD vendors.

Integration is achieved on various levels, ranging from interfaces to external products to highly integrated connectivity between logic diagrams and physical geometries within the same system.

It is only within the last two years that logic design and analysis have been truly integrated into PCB CAD systems. However, this integration has come from many young CAD vendors and only a few of the old guard leaders. Most of the old guard leaders that were not among the first with EDA have since added the functionality, but as a defensive response to either those companies that included EDA from the beginning or to those that added it later.

7.3-2 © 1986 Dataquest Incorporated July CCIS Markets

7.3 PCB Market Overview

We believe that the user is largely responsible for driving the incorporation of

EDA functionality into PCB systems. CAD vendors that correctly interpreted and quickly responded to users' needs were not only first to market but also have a better chance of surviving the extreme competition and pressures at the PCB design and layout level.

EDA functionalities applicable to printed circuit board design include the following:

• Schematic capture

• Logic simulation

• Physical device modeling/simulation

• Microprocessor development/software engineering

• Timing verification

• Thermal analysis

• Load checking

• Testability analysis

• Tester interfaces or program development

We do not believe that EDA functionality must be developed or integrated internally by all PCB CAD vendors. However, EDA options must be clearly visible and easy. Options may include third-party deals or an open and accessible data base to whicli the user or other vendors can interface. Those that pursue no options will seriously jeopardize their businesses, especially in the short term—when

Dataquest believes that the most attrition will occur.

Electromechanical

Electromechanical (EM) applications have long been part of printed circuit board design; so much so that it is not always clear if a vendor is selling mechanical or PCB applications. We believe that EM will continue to be important in PCB design but that its role will change dramatically.

Because the PCB is used in a mechanically designed product (card cage, cabinets, assemblies), integration with mechanical CAD will continue to be important.

CCIS Markets © 1986 Dataquest Incorporated July 7.3-3

7.3 PCB Market Overview

However, Dataquest believes that the user's highest priority is to design a board—logically and physically. With viable EDA and CAD alternatives and

Options, we believe that the user will choose electronic design functionality first and

EM functions second. This choice will affect companies with a strong focus on EM, as the buyer's primary emphasis will shift toward electronic design.

The data base will play a critical role in the product's acceptance. For example, we believe that the optimum EM product is one that is integrated into or with a data base with electrical data, not vice versa (electronic drafting integrated into a mechanical design product). Because the market's emphasis will shift toward electronic design, we believe that it is important for the data base to be electronic

CAD-oriented.

The final point on EM concerns the mechanical CAD segment itself. As its applications scope and depth broadens, so must the mechanical portion of electromechanical. Several vendors currently have a 3-D data base designing and displaying a board and its components. For a company to compete with an EM product, we believe that it must maintain product development and integration equal to the separate developments of both mechanical and electronic CAD products.

AUTOMATION

TTie approaches to creating printed circuit board geometries—manual editing or automatic layout—vary greatly from system to system. The trend is toward automatic layout, but there are questions about the trend: What kind? To what degree? On what hardware?

We believe that automatic layout is one of the most significant trends occurring in the PCB segment. However, we are also concerned about the seemingly mysterious and fearsome aura surrounding automatic placement and routing and about the effect that this aura will have on the success of PCB CAD automation growth.

For instance, automatic place and route programs have been commercially available for five to seven years, yet they are just becoming accepted. We believe that early routers were difficult to use, vague in their operations, and little understood, thus creating their mystery. Routers also tended to be less effective in completions than the user was led to believe, and, because they were usually batch programs, they were not friendly.

The good news is that both hardware and software technologies have changed.

Automatic routers allow more user intervention; their command structures and

Operating procedures are no longer just machine readable; and routing algorithms are better understood, at least conversationally. Routers themselves have removed some of the mystery and fear about their use.

7.3-4 © 1986 Dataquest Incorporated July OCXS Markets

7.3 PCB Market Overview

It's not all good news, however. In solving some of the major problems associated with routers, vendors have inadvertently created a new set of obstacles, as follows:

• "A little knowledge is dangerous." Despite only minimum understanding of routing algorithms, users are distracting vendors from selling benefits and are forcing features pitches.

• Lower system prices mean more potential buyers in this price-elastic market. More buyers mean that routers must become even easier to use and get even closer to 100 percent completion.

• Allowing rumored performance to overshadow conventional benchmarks will not only damage a company, but overselling to this degree will affect the entire PCB segment by rekindling fears and doubts in the end-user communities.

• The EDA connection allows a heated data base debate to surface—whether or not to open or control data base interfaces so that routing and back-annotation can both be done but perhaps on different vendors' product lines.

HARDWARE

Unlike the IC and EDA CAD segments, the PCB segment is plagued by different types of hardware. The IC segment, while predominately based on host-dependent architectures, is making a fairly smooth transition to standalone products. The EDA segment, while previously dominated by standalone products, is experiencing a computational alignment with the introduction of the personal computer. The PCB environment allows disparate hardware types to thrive in competition against each other.

Platforms

The availability of distributed processing has dramatically changed the PCB segment. Standalone and personal computers have expanded target markets and brought about new application implementations, better design integration, and lower prices. The chain of events causing the change has been a series of offensive actions and defensive reactions.

Initially, standalone PCB systems first competed against host-dependent systems on the basis of price, targeted at smaller companies that could not afford expensive shared-logic systems. Large companies, the sacred target markets of the host-dependent leaders, also realized the benefits of standalones and actively sought them out. This resulted in companies with host-dependent-based systems reacting defensively and scrambling to develop standalone-based products.

CCIS Markets © 1986 Dataquest Incorporated July 7.3-5

7.3 PCB Market Overvievy

In the next aggressive move, standalones competed against hosts on the basis of functionality, user interface, and ease of use. This was not so easy to react to because, by this time, any flaws in the host-dependent software were already being ported to new standalone products, requiring major rewrites in order to compete effectively.

In yet another aggressive move, EDA functionality was integrated with standalone PCB systems. The defensive reaction was even more difficult; in some cases, it required a complete software rewrite in order to associate electrical connectivity with geometry data. Nonetheless, vendors defensively scrambled to at least address EDA applications.

Then came the personal computer CAD system, first introduced by an outside set of competitors. Dataquest believes that PCs were first introduced as a defensive action, hiding behind niche classification because they were targeted at smaller companies. However, the move soon turned out to be extremely aggressive because the larger companies once again realized the benefits of the new hardware, this time the personal computer.

We believe that the market will continue to evolve in this cyclical fashion, with the majority of the vendors reacting defensively to the innovations of the few.

Accelerators

Not only is the PCB segment contending with competing and overlapping hardware platforms, it is also ushering in yet another type of hardware—the application accelerator. Accelerators are used to speed specific applications. In the

PCB segment, they are used most often as routing engines. We believe that the PCB accelerator phenomenon is occurring for several reasons, as follows:

• Routing algorithms are better understood, more flexible, and more stable.

• Hardware platforms with insufficient horsepower to complete a route within given time constraints require acceptable options.

• There is an underlying need for tools that increase productivity, in this case by decreasing the amount of time needed to complete a route.

• Distributed processing allows an accelerator to be accessed easily by many users, thus decreasing the cost per seat.

Current accelerators either are standalone engines without comprehensive design capabilities or are integrated into a design system. We do not believe that either technology, in and of itself, is better than the other. We do believe, however.

7.3-6 © 1986 Dataquest Incorporated July CCIS Markets

7.3 PCB Market Overview that price is the determining factor as to which is ultimately the best implementation, assuming fairly equal routing capability. The considerations and trade-offs affecting the buyer's decision may include the following:

• Process speed

• Routing completion

• Shared resource, network accessibility

• Remote job access

• Design functions

• Limitations imposed by the router

• Manufacturability

As the printed circuit board design function is more closely integrated into the broader electronic design cycle, we believe that it is important for application accelerators to be shared by the design network. Furthermore, we believe that as more and more personal computers become part of the design network, the power of the accelerator will become a required and critical part of most design projects.

MARKET PRESSURES

Companies selling PCB products are quickly redefining and expanding their businesses. The new business statement is an example of electronic product design automation. The expansion includes EDA applications, lower-priced hardware, accelerators, automatic placement and routing software, interactive and fast graphics, and, to some degree, electromechanical design.

We believe that the redefinition is occurring in reaction to several factors:

• New PCB companies with lower system prices, reentrant automatic layout, and/or front-end design capabilities

— Users' demands for alternatives

• EDA companies bringing out their big guns by introducing PCB CAD products while yelling "blood bath"

— Users' demands for closely coupled and integrated electronic product design products

CCIS Markets © 1986 Dataquest Incorporated July 7.3-7

7.3 PCB Market Overview

• The perceived necessary evil of personal computers that have lower gross profit margins and lower overall revenue, but are the platforms that users are buying and that produce PCB designs

— Users' demands for low-cost hardware solutions

• The old guard leaders flexing their mechanical CAD and CAM muscles

— Users' needs for integration into the product design process

These factors do not assume that the reactions were strictly to competition; they do not preclude strategic reactions to the users' demands. However, they do illustrate not only the competitive pressures, but also the diverse approaches in printed circuit board design and the major opportunities in the market segment.

7.3-8 © 1986 Dataquest Incorporated July CCIS Markets

7.4.1 Total PCB CAD/CAM

This section covers the total printed circuit board (PCB) CAD/CAM market for all regions and product types (see Figure 7.4.1-1 Revenue, Figure 7.4.1-1

Shipments, and Table 7.4.1-1).

• The PCB segment was an estimated $477 million in 1985 and is forecast to grow to $1,038 million in 1990, at a compound annual growth rate (CAGR) of 17 percent.

• Dataquest estimates that revenue will grow 16 percent in 1986, reaching

$552 million.

• Workstation shipments in 1985 were an estimated 5,668 units; shipments are expected to reach 23,663 units in 1990, growing at a 33 percent CAGR.

CCIS Markets © 1986 Dataquest Incorporated July 7.4.1-1

1000

800

$m mo

200

7.4.1 Total PCB CAD/CAM

Figure 7.4.1-1 Revenue

PCB CAD/CAM-Worldwide

Millions of Dollars

1200-

J^t;

K\s:.

^SSi

^s

^

•im

W ^ ^

^Jv%>V

• •" X N ^

1985 1986 1987 1988 1989 1990

Source: Dataquest

June 1986

7.4.1-2

1986 Dataquest Incorporated July

CCIS Markets

7.4.1 Total PCB CAD/CAM

Figure 7.4.1-1 Shipments

PCB C A D / C A M - W o r l d w i d e

Workstation Shipments

24000

21000

18000

1SOOO

12000

9000

6000

3000

1986

t ^

1987

W

V 't ^

'>h %

1988

1985

M

hw^:

•^^sV-'X

$'>$^;S

1990

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July 7.4.1-3

7.4.1 Total PCB CAD/CAM

Table 7.4.1-1

PCB CAD/CAM—Worldwide

Total Applications

(Millions of Dollars/Actual Units)

1985 1986 1987 1988 1989 1990 CAGR

Total Market

Revenue

Systems

Workstations

477

4,449

5,668

552

6,949

8,221

659

9,876

10,975

778

13,392

14,294

902

17,634

18,367

1,038 16.8%

23,150 39.1%

23.663 33.1%

Source: Dataquest

June 1986

7-4.1-4 © 1986 Dataquest Incorporated July CCIS Markets

7.4.2 PCB Market Shares

This section covers Dataquest's analysis of the PCB market share distribution

(see Figure 7.4.2-1 and Table 7.4.2-1).

• Computervision continues to lead the PCB market, with nearly 11 percent of the 1985 market, although its market share dropped 9 points from its

1984 share.

• Dataquest believes that Computervision continues to dominate the PCB segment because the majority of PCB sales are integrated with CADDS4X, its mechanical design software.

• Racal-Redac became the second-largest PCB vendor, with a 10 percent share. Dataquest attributes Redac's growth to the relatively new Visuala product.

• Scientific Calculations' position slipped to third place in 1985, with a

9 percent market share.

• Hewlett-Packard achieved a 6 percent market share in its first year of shipping a PCB product. The company's product is primarily a drafting tool that can also be used for mechanical design.

• The PCB segment continues to have many vendors jockeying for market position, making it a highly fragmented market with total revenue of more than $15 million. Dataquest is listing, for the first time, market share for the following companies:

— Autodesk

— Cadnetix

— Calay

— Ferranti

— Tektronix

CCIS Markets © 1986 Dataquest Incorporated July 7.4.2-1

7.4.2 P C B Market Shares

Figure 7.4.2-1

PCB Market ShareWorldwide

1985

Source; Dataquest

JuneT986

7.4.2-2

1986 Dataquest Incorporated July

CCIS Markets

Table 7.4.2-1

PCB Market Share—Worldwide

(Millions of Dollars)

7.4.2 PCB M a r k e t Shares

COMPANY

1985

REVENUE

1985

SHARE

CoInputervision

Racal-Redac

Scientific Calculations

Hewlett-Packard

IBM

Intergraph

Calma

Cadnetix

Applicon

Calay

Telesis

Gerber Scientific

Telctronix

Autodesk

Ferranti

Other Computer Companies

Other Europe Companies

Other Far East Companies

Other Turnkey and Software

All Companies

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

17

16

13

6

5

1

0

11

53

49

45

30

26

23

18

17

34

96

18

477

11.1%

10.2%

9.4%

6.3%

5.5%

4.7%

3.8%

3.7%

3.5%.

3.3%

2.6%

1.3%

1.1%

.3%

.0%

2.3%

7.1%

20.1%

3.7%

100.0%

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

7.4.2-3

7.4.2 PCB Market Shares

(Page intentionally left blank)

7-4.2-4 ® 1986 Dataquest Incorporated July CCIS Markets

7.4.3 PCB Regions

MARKET BY REGION

This section includes Dataquest's forecasts for and analysis of the PCB market, segmented by region (see Figure 7.4.3-1 Revenue, Figure 7.4.3-1 Shipments, and

Tables 7.4.3-1 and 7.4.3-2).

• Dataquest believes that North America will lead in consumption of PCB systems through 1990, with $219 million in 1985, growing to $476 million in 1990, at a CAGR of 17 percent.

• We are forecasting no change in the relative positions of Europe, the Far East, and the Rest of World segments for consumption of

PCB systems.

• Europe consumed $116 million worth of PCB systems in 1985; this figure is forecast to grow to $254 million in 1990, at a CAGR of 17 percent.

• The Far East segment consumed $136 million worth of PCB systems in

1985; consumption is forecast to grow to $298 million in 1990, at a CAGR of 17 percent.

• The Rest of World countries consumed $5 million worth of PCB systems in

1985; consumption is forecast to grow at a CAGR of 17 percent, reaching

$10 million in 1990.

CCIS Markets © 1986 Dataquest Incorporated July 7.4.3-1

7.4.3 PCB Regions

Figure 7.4.3-1 Revenue

PCB CAD/CAM by Region

360

300

240

180i

120

60-.

Millions of Dollars

540

480

420 t985

1986

1987

1986 1369 1990

Source: Dataquest

June 1986

7.4.3-2

© 1986 Dataquest Incorporated July

CCIS Markets

7.4.3 PCB Regions

6000

4000-

2000

0 ) | ^

1985

Workstation Sliipnnents

10000

X

North America

Europe

Far East

ROW

8000

Figure 7.4.3-1 Shipments

PCB CAD/CAM by Region

1986 1987 1988

1989

1990

Source: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

7.4.3-3

7.4.3 PCB Regions

Table 7.4.3-1

P C B CAD/CAM

Application by Region

(Millions of Dollars/Actual Units)

1985 1986

1987 1988 1989 1990

CAGR

Total Market

Revenue

Systems

WorIcstations

477

4,449

5,668

552

6,949

8,221

659

9,876

10.975

778

13,392

14,294

902

17,634

18,367

1.038

23.150

23.663

16.8X

39. IX

33. IX

North America

Revenue

Systems

Workstations

219

2,293

2,618

254

3.295

3.846

303

4.596

5,075

357

6,158

6,543

414

8,102

8,381

476

10,586

10,795

16.8X

35.8X

32.8X

Europe

Revenue

Systems

Workstations

116

1,146

1,271

135

1.819

2.149

161

2,420

2,765

190

3,167

3,502

220

4,165

4,461

254

5,532

5,743

16.9X

37. OX

35.2X

Far East

Revenue

Systems

Workstations

136

977

1,733

158

1,777

2.154

189

2,780

3,037

223

3,942

4.113

259

5,186

5.339

298

6,793

6.884

Rest of World

Revenue

Systems

Workstations

5

33

47

5

58

72

6.

81

97

8

125

136

9

181

185

10

239

241

16.9X

47.4X

31.8X

16.8X

48.6X

39.0X

Source: Dataquest

June 1986

7.4.3-4

1986 Dataquest Incorporated July

CCIS Markets

7.4.3 PCB Regions

Table 7.4.3-2

PCB CAD/CAM

Application by Region

(Percent of Total)

1985 1986 1987 1988 1989 1990

North America

Revenue

Systems

Workstations

Europe

Revenue

Systems

Workstations

Far East

Revenue

Systems

Workstations

Rest of World

Revenue

Systems

Workstations

46X

52X

46X

46X

47X

47X

46X

47X

46X

46X

46X

46X

46X

46X

46X

46X

46X

46X

24X

26X

22X

29X

22X

31X

IX

IX

IX

24X

26X

26X

29X

26X

26X

IX

IX

IX

24X

24X

25X

29X

28X

28X

IX

IX

IX

24X

24X

25X

29X

29X

29X

IX

IX

IX

24X

24X

24X

29X

29X

29X

IX

IX

IX

24X

24X

24X

29X

29X

29X

IX

IX

IX

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July 7.4.3-5

7.4.4 PCB Product Types

This section includes Dataquest's forecasts for and analysis of the PCB

CAD/CAM market segment by product type (see Figure 7.4.4-1 Revenue,

Figure 7.4.4-1 Shipments, and Tables 7.4.4-1 and 7.4.4-2).

• Host-dependent systems led in revenue in 1985, with $237 million, or

50 percent of all PCB revenue.

• Host-dependent revenue is expected to give way to standalone revenue in

1986 and to fall to only 6 percent of PCB revenue in 1990.

• Standalone revenue is forecast to grow from $193 million in 1985 to

$941 million in 1990, representing a 37 percent CAGR.

• As a percent of revenue, standalones are expected to increase from

40 percent in 1985 to 91 percent in 1990.

• Dataquest believes that the primary reasons for the strength of standalone systems in the PCB segment are their lower cost per seat and their acceptable performance levels.

• We believe that with the relative strength of standalone systems will also come the inherent benefits of distributed architectures.

• Personal computer (PC) revenue is expected to decrease from $47 million in 1985 to $38 million in 1990, at a rate of 4 percent.

• PC shipments were 2,100 in 1985 and are forecast to increase to 2,195 in

1990, at a CAGR of 1.2 percent.

• Dataquest believes that PCs have become widely accepted, primarily because of their low cost per seat.

• Because of their comparatively low price/performance ratios, we believe that most PCs will be used in a networked environment for manual drafting applications, not for automatic place and route.

• Place-and-route programs are available for several vendors' PCs. Dataquest believes that there is a market for such a product, but that these PCs will not be used for large and complex printed circuit boards.

• Due to inherent computational issues of automatic place and route, we believe that end users with complex boards will opt for higher performance, trading off lower price per seat.

• Plug-in coprocessors and accelerators will play a large role in the widespread acceptance of the PC and an automatic layout product.

CCIS Markets © 1986 Dataquest Incorporated July 7.4.4-1

7.4.4 PCB Product Types

• With the availability of truly low-cost standalone systems, we believe that standalone systems will be chosen over PCs because of both their network and graphics capabilities and their relatively higher performance.

• PCB shipments will be dominated by standalone architectures through

1990.

• We believe that the majority of large, more costly host-dependent systems will be sold by CAD vendors with multifunctionality, such as mechanical or

Other electronic applications.

7-4.4-2 © 1986 Dataquest Incorporated July CCIS Markets

7.4.4 PCB Product Types

Figure 7.4.4-1 Revenue

PCB CAD/CAM by Product Type—Worldwide

700-

600-

500-

4 0 0 -

300-

Millions of Dollars

9 0 0 -

Standalone

Host-Dependent

Personal Computer

800-

2001

100-

0 -

1985

A —

1

1986

—A

1987

— A

1988

* - I L

1969

1990

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

7.4.4-3

7.4.4 PCB Product Types

Figure 7.4.4-1 Shipments

PCB CAD/CAM by Product Type—Worldwide

Workstation Shipments

21000

• Standalone

# Host-Dependent

A Personal Computer

18000

15000

12000

9000

6000

3000

1985 1986 1987 1988 1989 1990

Source: Dataquest

June 1986

7.4.4-4

1986 Dataquest Incorporated July

CCIS Markets

Table 7.4.4-1

PCB C A D / C A M - W o r l d w i d e

Application by P r o d u c t Type

(Millions of Dollars/Actual Units)

7.4.4 PCB Product Types

1985

1986 1987 1988 1989 1990

CAGR

Total Market

Revenue

Systems

Workstations

Standalone

Revenue

Systems

Workstations

477

4,449

5,668

552

6,949

8,221

659

9.876

10.975

778

13,392

14,294

902

17,634

18,367

1.038

23,150

23.663

16.8%

39.IX

33.15C

193

1,823

1,823

289

3.762

3,762

444

6.610

6.610

611

10,415

10,415

772

15.075

15,075

941

20,929

20.929

37.3%

62.9X

62.9%

Host-Dependent

Revenue

Systems

Workstations

237

526

1.746

213

565

1.837

161

450

1.548

118

338

1,241

87

249

981

59

155

668

-24.4X

-21.7%

17.5%

Personal Computer

Revenue

Systems

Workstations

47

2,100

2,100

50

2.622

2,622

53

2,816

2.816

50

2,639

2,639

43

2.311

2.311

38

2.066

2,066

-4.OX

-.3X

-.3X

SOURCE: Dataquest

June 1986

CCIS Markets

1986 Dataquest Incorporated July

7.4.4-5

7.4.4 PCB P r o d u c t Types

Table 7.4.4-2

PCB C A D / C A M - W o r l d w i d e

Application by Product Type

(Percent of Total)

Standalone

Revenue

Systems

Workstations

Host-Dependent

Revenue

Systems

Worlcstations

Personal Computer

Revenue

Systems

Workstations

1985 1986

1987 1988 1989 1990

40%

41%

32%

52%

54%

46%

67%

67%

60%

78%

78%

73%

86%

85%

82%

91%

90%

88%

50%

12%

31%

10%

47%

37%

39%

8%

22%

24%

5%

14%

9%

38%

32%

8%

29%

26%

15%

3%

9%

6%

20%

18%

10%

1%

5%

5%

13%

13%

6%

1%

3%

4%

9%

9%

SOURCE: Dataquest

June 1986

7.4.4-6

1986 Dataquest Incorporated July

CCIS Markets

7.4.5 PCB Average Price Per Seat

This section includes Dataquest's forecasts for and analysis of the average price per seat by product type for the PCB segment (see Figure 7.4.5-1 and

Table 7.4.5-1).

• The overall average price per seat for PCB CAD applications was

$64,400 in 1985 and is forecast to decrease at a 13 percent CAGR, reaching $31,600 in 1990.

• The amount of software and its value ultimately determines the end-user price.

• The value of software will hold the price of a turnkey seat higher than if measuring only the value of the CPU and workstation.

• The standalone average price per seat is forecast to decrease the most, from $84,100 in 1985 to $32,600 in 1990, at a compound rate of

17 percent.

• Dataquest believes that as the average price per standalcwie seat decreases, its performance will increase, resulting in systems of equivalent performance at a lower price.

• Host-dependent seats, while decreasing at a compound rate of 14 percent, from $124,400 in 1985 to $58,000 in 1990, will not favorably compete on a price basis with standalone systems.

• Personal computers are forecast to decrease the least, at a rate of 7 percent compounded annually, because we believe that PCs will proportionately absorb more software and peripherals than standalone and host-dependent workstations.

CCIS Markets © 1986 Dataquest Incorporated July 7.4.5-1

80-

80-

40'-

7.4.5 PCB Average Price Per Seat

Figure 7.4.5-1

PCB Turnkey—Worldwide

Average Price per Seat

Thousands of Dollars

120-

Standalone

Host-Dependent

Personal Computer

KM^

^1

^ A

A

0-

1985

1

1S86 1987

—A

1988

* i

1989 1990

Source: Dataquest

June 1986

7.4.5-2 1986 Dataquest Incorporated July

CCIS Markets

7.4.5 PCB Average Price Per Seat

Table 7.4.5-1

PCB Turnkey—Worldwide

Average Price per Seat

(Thousands of Dollars)

All Product Types

Standalone

Host-Dependent

Personal Computer

1985 1986 1987 1988 1989 1990 CAGR

64.4

84.1

124.4

18.4

56.8

61.0

97.9

17.1

49.2

53.1

85.9

16.0

43.0

45.7

75.4

14.9

37.3

38.8

66.1

13.7

31.6 -13%

32.6 -17%

58.0 -14%

12.5 - 8 %

Source: Dataquest

June 1986

CCIS Markets © 1986 Dataquest Incorporated July 7.4.5-3

7.4.6 PCB Revenue Source

This section includes Dataquest's forecasts for and analysis of the PCB market, segmented by source of revenue for each product type (see Figure 7.4.6-1 and

Tables 7.4.6-1 and 7.4.6-2).

• The hardware portion of PCB systems in 1985 was $273 million, or

57 percent of PCB revenue.

• Dataquest forecasts that the value of hardware will decrease to 44 percent of revenue, or $457 million in 1990.

• The percentage value of hardware is decreasing because both software and service will increase as a percent of the system's value.

• A primary reason for hardware remaining at the percentage level forecast is that the value of peripherals compared to the value of a CPU and terminal is expected to increase.

• Peripherals such as application accelerations, physical modelers, and graphics accelerators are expected to contribute heavily to the hardware portion of the business.

• Dataquest believes that the relative and absolute software content of a system will increase over time, resulting in more software purchases and in end-user price decreases not maintaining pace with decreasing hardware prices.

• The software portion of the PCB segment was 30 percent in 1985, or approximately $141 million.

• As the installed base increases, especially due to the proliferation of

Standalone workstations and personal computers, the value of service is forecast to grow from 13 percent revenue in 1985 to 21 percent in 1990.

• We believe that service is a core and critical part of all CAD vendors' business; we also believe that it must become a revenue-contributing profit and loss center.

CCIS Markets © 1986 Dataquest Incorporated July 7.4.6-1

7.4.6 PCB Revenue Source

Figure 7.4.6-1

PCB CAD/CAM-Worldwide

Applications by Revenue Source

300

250

200

150

100:

Millions of Dollars

500-

450

• Hardware

• Software

A Service

400

350.

1985 1986

1987 1988 19B9 1990

Source: Daiaquett

June 1986

7.4.6-2

1986 Dataquest Incorporated July

CCIS Markets

Table 7.4.6-1

PCB CAD/CAM-Worldwide

Applications by Revenue Source

(Millions of Dollars)

7.4.6 PCB Revenue Source

All Product

Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Computer

Hardware

Software

Service

Total

1985 szs«

273

141

63

477

1986

ssss

1987

sssa

1988

S K S S

1989

seass

1990

S S S S

314

163

74

552

357

209

94

659

400

258

120

778

434

309

159

902

457

366

215

1,038

CAGR

===s

11%

2 U

28%

17%

98

67

28

193

156

91

42

289

235

143

67

444

311

201

98

611

372

261

139

772

418

326

197

941

34%

37%

48%

37%

157

46

34

237

140

41

31

213

103

32

26

161

72

24

21

118

49

19

19

87

29

13

17

59

-28%

-23%

-13%

-24%

IS

28

1

47

18

31

1

50

19

34

1

53

16

33

1

50

13

30

1

43

10

28

1

38

•11%

-0%

-4%

•4%

Source: Dataquest

June 1986

CCIS Markets 1986 Dataquest Incorporated July

7.4.6-3

7.4.6 PCB Revenue Source

Table 7.4.6-2

PCB CAD/CAM-Worldwide

Applications by Revenue Source

(Percent of Total)

A l l Product Types

Hardware

Software

Service

Total

Standalone

Hardware

Software

Service

Total

Host-Dependent

Hardware

Software

Service

Total

Personal Computer

Hardware

Software

Service

Total

1985 1986 1987 1988 1989

1990

57%

30%

13X

100X

57X

30%

13X

100X

S4X

32X

UX

100X

S1X

33X

15X

100X

48%

34X

18X

100X

44X

35X

21X

100%

51X

35%

15X

100X

54X

32X

15X

100X

53X

32X

15X

100X

SIX

33X

16X

100X

48X

34X

18X

100X

44X

35%

21%

100%

66X

19X

14X

100X

66X

19X

15X

100X

64X

20X

16X

100X

61X

21X

18X

100X

57X

21X

22X

100X

50%

21%

29%

100%

39X

60X

2X

100X

37X

61X

2X

100X

35X

63X

2X

100X

33X

66X

2X

100X

30X

69X

2X

100X

26%

72X

2X

100X

Source: Dataquest

June 1986

7.4.6-4 1986 Dataquest Incorporated July

CCIS Markets

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