Many companies, such as CNC Software, Gibbs, and Surfware are totally dependent on resellers. As
previously noted, some companies such as Cimatron, tend to start with resellers in a given geography and
then establish local subsidiaries as it becomes successful. Other suppliers, such as Delcam, implement
joint ventures in geographies of interest.
Vendors like UGS and Planit have been successful with direct sales people. The primary arguments
favoring direct sales are that it provides complete product dedication and greater control over the sales
force. Also, vendors are more comfortable in investing in training of direct salespeople. This usually
makes them more effective in complex, corporate selling situations, and in selling of complex products.
XIII. Software Seats
A. Software Seats Shipped and Installed Base
The CIMdata estimated number of NC-related software seat licenses shipped, and the year-end installed
base of NC seats is shown in the following figure for 1996 through 2005. Seat counts are based on the
number of software locks on individual computer processors utilizing CAM software in customer
environments. It is not the number of individual software modules running on a processor. For this tally,
the customer could be either an industrial or educational customer. The unit counts do not include dealer
or demo software or software running in a controller. Also, upgrades to a higher level software product on
the same processor do not count as an additional shipment. For processors installed on a network, the
counts are the number of concurrent licenses that have been purchased for the primary CAM product.
It can be seen that the estimated total number of NC seat licenses shipped in 2004 was 87,210. This was
composed of 67,110 industrial seats and 20,100 educational seats. This was an increase of 10.5% from
2003 in the number of seats shipped. This growth rate is greater than the revenue growth rate as there was
more discounting in the price per seat. Also, this increase is somewhat greater than would be expected,
but it is primarily due to the shipments by Pathtrace in the Project Lead the Way program. They
increased their placement of education seats from 800 in 2003 to 6,000 in 2004.
The number of industrial seat shipments and the number of education seat shipments both increased. The
worldwide base of installed NC software seats at the end of 2004 is estimated to be approximately
659,520. This is composed of 523,370 industrial seats and 136,150 educational seats.
CIMdata forecasts that in 2005, approximately 92,750 additional seats will be shipped. This will be a
6.4% increase in shipments and will bring the installed base to roughly 709,730 seats. The shipments plus
the previous year installed base are not directly cumulative, as some seats are retired each year. CIMdata
estimates this amount, but it is an imprecise estimate. The growth in number of seats shipped per year
generally tracks the growth in total annual software revenue, although the growth in seats shipped is
typically greater than the growth in revenues.
CIMdata views these values as conservative estimates, since the level of information provided by vendors
regarding seat counts has been less than that furnished for revenues. Moreover, vendors typically know
the total number of seats shipped over any period of time, but they do not have an accurate count of their
installed base. They know the total number of seats on a software maintenance contract at any point in
time, but if a user replaces a non-maintenance seat with a seat from a competitor, this is not normally
known to the original vendor. Hence, CIMdata adjusts the total installed base somewhat to allow for this
factor.
Copyright � 2005 by CIMdata, Inc. NC Market Assessment V14-209
 Installed Base
Year NC Seats Shipped Annual Growth Rate % Number of Seats
1996 56,000 15 275,000
1997 65,000 16 315,000
1998 74,000 12 361,000
1999 83,000 15 474,000
2000 89,000 7 511,000
2001 82,500 -7.3 531,000
2002 80,200 -2.8 546,000
2003 78,940 -1.6 594,400
2004 87,210 10.5 659,520
2005 92,750 6.4 709,730
Figure 101. NC Software Licenses and Installed Base
B. Vendor Ranking by Industrial Seats Shipped and Installed Base
The market share of the top ten vendors on the basis of industrial seats shipped during 2004 is shown in
the figure below. CIMdata places much more credence on industrial seats than educational seats.
Industrial users are the primary focus of most vendors and the vast bulk of revenues are obtained from
these users. Moreover, sales to industrial users are highly competitive and are a measure of software
value. As such, for seat count comparisons among vendors, the primary CIMdata ranking is based on
industrial seats. In addition, a separate, less comprehensive ranking based on educational seats is provided
in the next section.
2004
CNC Software
UGS
6.8%
7.2%
PTC 5.8%
Planit
5.8%
IBM/Dassault
Other
5.1%
49.8%
Hitachi Zosen
4.6%
Pathtrace 4.2%
DP Technology
Vero Intl
3.1%
Delcam 3.9%
3.7%
Figure 102. Market Share of NC Vendors Based on Industrial Seats Shipped
The market share of the top ten vendors on the basis of industrial seats installed at year-end 2004 is
shown in the subsequent figure.
210-NC Market AssessmeV14 Copyright � 2005 by CIMdata, Inc.
2004
CNC Software
PTC
9.2%
8.2%
UGS 6.3%
Other
44.4%
Planit 5.3%
IBM/Dassault 5.3%
Pathtrace 5%
TekSoft
Delcam 3.9%
Vero Intl
Surfware 4%
4.4%
4%
Figure 103. Market Share of NC Vendors Based on Industrial Seats Installed
The number of industrial seats shipped and installed clearly measures the pervasiveness of vendor
software in the markets of primary interest, and the length of time the vendor has been shipping software.
They indicate the actual number of users, since the ranking is independent of the software price. Vendors
in these rankings are dramatically different than the vendors listed in the rankings based on user
expenditures, or revenues received by the vendor in a given year. Seat ranking favors those vendors
providing lower-cost software through a distributor network, over a longer period of time.
As with revenue data, CIMdata often adjusts information provided by the vendor. Additionally, if
CIMdata views the vendor to be on a downward slide, CIMdata could show the installed base decreasing,
even though additional seats are being shipped. New software versions, product updates, or additional
modules added to the software lock do not impact the seat count. Like all other information in this report,
CIMdata makes its best estimate, continually reassesses the information, and updates the data in each
version of the Market Assessment report.
CNC Software has been the consistent market leader on the basis of industrial seat count. However, as
shown in the above figure for industrial seats shipped, they were surpassed for the first time by UGS in
2004. CNC Software did retain its leadership position in terms of the installed base of industrial seats at
the end of 2004. UGS was responsible for 7.2% of the industrial seats shipped in 2004, as compared to
the CNC Software value of 6.8%. CNC Software has an estimated 9.2% of the installed base at the end of
2004. CNC Software has been the leader in this ranking since CIMdata began measuring the market.
Mastercam is a well-known and pervasive product.
The distinction in rankings is evident by comparing seat count rankings to the revenue-related rankings.
In the vendor revenue listing, CNC Software is positioned as only the number 13 vendor in 2004, with
revenues of $19.0 million. This can be compared to the UGS revenues of $115 million in 2004. On the
basis of end-user payments in 2004, CNC Software is listed in the eighth position with end-user payments
of $41.8 million. Again, it can be noted that since all CNC Software revenues are derived from resellers
the value of end-user payments is 2.2 times that of the CNC revenues. Hence, they rank higher on end-
user payments than they do on vendor revenues. IBM/Dassault SystŁmes is the largest vendor on the basis
of end-user payments in 2004 with $161.6 million. Although both the UGS and IBM/Dassault SystŁmes
revenues are substantially greater than that of CNC, CNC is the leader in seats installed and is in the
number two position in seats shipped in 2004. This is because the price of the software is significantly
less than either that of UGS or IBM/Dassault SystŁmes.
For industrial seats shipped in 2004, the remaining vendors in the top ten after UGS and CNC Software
are estimated to be PTC, Planit, IBM/Dassault SystŁmes, Hitachi Zosen, Pathtrace, Delcam, Vero
International, and DP Technology.
Copyright � 2005 by CIMdata, Inc. NC Market Assessment V14-211
The estimated rankings of the top 10 vendors based on the number of industrial seats in their installed
base is shown in the figure above for 2004. After CNC Software, the vendors with the largest estimated
installed base in 2004 are PTC, UGS, Planit, IBM/Dassault SystŁmes, Pathtrace, TekSoft, Surfware, Vero
International, and Delcam. This ranking clearly favors those vendors that have been in the business for an
extended period of time. It can also be noted that although CNC Software is the clear leader on a seat
count basis, PTC, UGS, and IBM/Dassault SystŁmes continue to rank among the CAM leaders on this
criteria as well as the revenue rankings.
In both categories of seats shipped and seats installed, the  other category is unusually large. In 2004,
49.8% of the seats shipped were from companies outside of the top ten and 44.4% of the installed base is
from companies not in the top ten. This reflects a large number of products being shipped at lower prices.
As compared to revenue information, in which the 30 largest vendors are presented, these listings only
detail the top 25 vendors. This reflects a degree of uncertainty in the seat count data. Again, one can note
the significant differences between the seat count and revenue rankings.
Industrial Seats Shipped Industrial Seats Installed
Rank Company 2002 2003 2004 Rank Company 2002 2003 2004
1 UGS 3,900 4,273 4,830 1 CNC Software 40,632 44,571 48,152
2 CNC Software 3,945 4,284 4,544 2 PTC 38,000 40,000 43,000
3 PTC 4,000 4,050 3,900 3 UGS 25,000 28,270 33,222
4 Planit 3,400 3,600 3,875 4 Planit 21,600 24,600 27,636
5 IBM Dassault 3,200 3,200 3,400 5 IBM/Dassault 24,500 26,000 27,500
6 Hitachi Zosen 3,000 3,000 3,100 6 Pathtrace 21,000 23,500 26,350
7 Pathtrace 2,600 2,500 2,850 7 TekSoft 21,800 22,400 23,000
8 Delcam 2,150 2,550 2,600 8 Surfware 17,380 19,760 21,000
9 Vero Intl 1,850 2,800 2,450 9 Vero Intl 15,740 18,540 20,990
10 DP Technology 2,160 2,000 2,100 10 Delcam 15,045 17,595 20,195
11 ICAM Technologies 1,700 1,700 1,700 11 Cimatron 17,000 18,000 19,000
12 Missler Software 1,000 1,480 1,600 12 DP Technology 15,257 16,988 18,988
13 Camtek 1,400 1,400 1,400 13 Hitachi Zosen 14,000 16,000 18,000
14 Gibbs 1,350 1,200 1,285 14 Gibbs 13,650 15,300 16,585
15 Cimatron 1,400 1,150 1,200 15 Intercim 15,400 15,800 16,200
16 Surfware 1,380 900 1,000 16 Camtek 11,300 12,300 13,355
17 Graphic Products 950 950 950 17 Missler Software 11,000 14,480 13,000
18 Sescoi 1,100 900 950 18 ICAM Technologies 9,000 10,000 11,000
19 OPEN MIND 760 850 910 19 Sescoi 7,000 8,000 9,000
20 Tebis 800 850 900 20 OPEN MIND 6,600 7,600 8,200
21 SolidCAM 720 720 860 21 Graphic Products 6,200 6,900 7,600
22 TekSoft 700 700 780 22 CG Tech 6,000 6,400 6,800
23 EGS 645 700 750 23 EGS 5,345 6,045 6,045
24 Nihon Unisys 700 700 700 24 Tebis 3,400 4,000 4,600
25 Scanvec 650 650 650 25 Nihon Unisys 3,100 3,700 4,300
Others 17,240 16,783 17,826 Others 59,901 59,151 59,652
Total 62,700 63,890 67,110 Total 444,850 485,900 523,370
Figure 104. 2004 Ranking of NC Vendors by Industrial Seats Shipped and Installed Base
The forecast ranking of the top 25 vendors for 2005 on the basis of industrial seats shipped and installed
base is shown in the following figures. It can be seen that UGS is again expected to be the leading vendor
on the basis of industrial seats shipped and CNC Software is projected to remain as the leader in terms of
industrial seats installed.
212-NC Market AssessmeV14 Copyright � 2005 by CIMdata, Inc.
Industial Seats Shipped Industrial Seats Installed
Rank Company 2003 2004 2005 Rank Company 2003 2004 2005
1 UGS 4,273 4,830 5,200 1 CNC Software 44,571 48,152 52,802
2 CNC Software 4,284 4,544 4,650 2 PTC 40,000 43,000 44,000
3 Planit 3,600 3,875 4,280 3 UGS 28,270 33,222 37,500
4 PTC 4,050 3,900 4,050 4 Delcam 17,595 20,195 29,895
5 Delcam 2,550 2,600 3,600 5 Pathtrace 23,500 26,350 29,650
6 IBM/Dassault 3,200 3,400 3,500 6 Planit 24,600 27,636 29,601
7 Pathtrace 2,500 2,850 3,300 7 IBM/Dassault 26,000 27,500 29,000
8 Hitachi Zosen 3,000 3,100 2,700 8 Vero Intl 18,540 20,990 23,640
9 Vero Intl 2,800 2,450 2,650 9 TekSoft 22,400 23,000 23,500
10 DP Technology 2,000 2,100 2,200 10 Surfware 19,760 21,000 22,000
11 Missler Software 1,700 1,600 1,800 11 DP Technology 17,000 19,000 20,500
12 ICAM Technologies 1,480 1,700 1,700 12 Cimatron 18,000 19,000 20,000
13 Camtek 1,400 1,400 1,400 13 Hitachi Zosen 16,000 18,500 18,500
14 Gibbs 1,200 1,285 1,400 14 Gibbs 15,300 16,585 17,000
15 Cimaton 1,150 1,200 1,300 15 Intercim 15,800 16,200 15,000
16 OPEN MIND 850 910 1,030 16 Missler Software 14,480 13,000 14,400
17 Surfware 900 1,000 1,100 17 Camtek 12,300 13,355 14,000
18 SolidCAM 720 860 1,050 18 ICAM Technologies 10,000 11,000 11,000
19 Sescoi 900 950 1,000 19 Sescoi 8,000 8,700 9,400
20 Graphic Products 950 950 950 20 OPEN MIND 7,600 8,200 9,100
21 TekSoft 700 780 920 21 Graphic Products 6,900 7,600 8,100
22 Tebis 850 900 900 22 CG Tech 6,400 6,800 7,200
23 Nihon Unisys 700 700 700 23 Tebis 4,000 4,600 5,000
24 IMS 550 600 650 24 Nihon Unisys 3,700 4,300 4,800
25 ScanVec 650 650 650 25 IMS 3,400 3,900 4,500
Others 18,143 17,976 17,910 Others 61,784 61,585 53,312
Total 65,100 67,110 70,590 Total 485,900 523,370 553,400
Figure 105. Forecasted 2005 Ranking of NC Vendors by Industrial Seats Shipped and Installed Base
C. Vendor Ranking by Educational Seats Shipped and Installed
Base
The 2003 and 2004 ranking of the largest NC software vendors, based on the estimated number of
educational seats shipped and in the installed base is shown in the figures below. As indicated, CIMdata
places less emphasis on educational ranking than on industrial rankings. Moreover, not all vendors supply
software to the education market. As such, only the top 15 vendors are listed. In the past, CNC Software
has been the dominant vendor in the education market on the basis of both seats shipped and installed
base. However, in 2004, Pathtrace replaced CNC Software as the leader in the education market. In 2004,
Pathtrace took over the Project Lead the Way program which places large numbers of NC seats into
education market. As a result, the number of seats shipped by Pathtrace increased from 800 in 2003 to
6,000 in 2004. CNC Software, UGS, and Delcam also ship a significant number of seats into education.
Copyright � 2005 by CIMdata, Inc. NC Market Assessment V14-213