This week’s chart, which takes data from the Cambashi Country Observatory, shows the expenditure on AEC software (essentially BIM Design software) in India, Indonesia, New Zealand and South Africa.

Why the sudden growth?

The four countries chosen for this chart – India, Indonesia, New Zealand and South Africa – all have quite different underlying expectations of growth. For example, India is one of the major growth engines of the world economy at the moment, whilst New Zealand is a developed economy with much lower growth. Indonesia and South Africa sit between the two, with growth dependent on their underlying industry structure. Although South Africa is an emerging economy with great potential, much of its economy is driven by Mining and Extraction. This industry is suffering from the reduction in investment by the Chinese government, therefore reducing the growth in South Africa.

What is remarkable about the chart is not so much the differences between the countries, but the similarity. For all the countries, 2017 and 2018 are expected to be much higher growth than 2016.

The reason for the change is the drive towards subscription pricing by the major vendors Dassault Systèmes, PTC and especially Autodesk. Autodesk has a significant market share in this application segment, so any change in Autodesk revenue expectations will change the entire segment. As Autodesk moved towards only offering subscriptions for new customers during 2016, we expect a drop in the revenues. This is because of the difference in how revenues are treated between subscription and perpetual licenses. In subscriptions, the revenue is recognised across the term of the license; perpetual revenues are recognised as in the year the license was purchased. This means that some revenue that would previously show up as in 2016, will be shown as 2017 and 2018.

There’s no real underlying change in how much software people are purchasing, it’s just a feature of the move to subscriptions.

It’s not boom and bust

In the same way that the BIM market did not suffer its own recession in 2016, it’s also not going to benefit from a boom in 2017. However, the forecast growths beyond 2017 and 2018 will give a much better feel for how the underlying industry is doing.

The growths out to 2020 are available in the Cambashi Country Observatory, with forecasts updated in November.

The Observatories

The Cambashi Market Observatories are a set of consistent and multi-perspective datasets for the technical software market. They provide detailed information on software spend by country, industry and product and the size of user communities, for a range of technical software application types, including:

• CAD, CAM, CAE
• PLM
• BIM
• AEC
• GIS
• IoT (software development tools)

Each data set provides a different way of measuring the use of software in industry, and can be used in combination to support business planning at global, regional and local levels. The methodology combines public and 3rd party data sources with Cambashi’s quantitative and qualitative research in each of these market views. Developed over 25 years, the combination of top down macroeconomic, industry detail and bottom up supply side (software provider) views leads to a highly consistent, multi-granular view of the market.

The Cambashi Country Observatory provides a snapshot of market opportunity by investigating technical application spend across more than 50 countries worldwide.

Sources: Oxford Economics, IMF, World Bank, EITO, national statistics.

How to get hold of the Observatories

If you would like more information on the Cambashi Market Snapshots or Market Observatories please contact Dan Roberts Tel: +44 1223 460 439.