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Kapitalmarknadsdag

2006-03-09

Ingemar Ljungdahl

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ALM => EALM => ELM

RMPPMCNM

MDD

ASQ

SCM

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AMD Definition

AMD tools represent the formalized methodologies and technologies (both object oriented and nonobject) that assist in creating or constructing model-generated applications, application requirements, data definitions, programming specifications, sequence diagrams, data and business processes, and business rules. This market includes modeling language development environments and business process analysis tools. AMD tools and technologies may integrate or combine the abstract benefits of visual modeling and automated methodologies and may include tools to construct applications from domains, rules, and/or components if that ability is fully integrated and sold with the methodology. This class of tools includes business process modelers, business rules engines, business rules repositories, and business process analysis platforms along with the modeling languages that support them. This market definition therefore lends itself to a simplistic segmentation into tools that model business activities and tools that support the definition, execution, and the management of business rules. This segmentation into MDD and BRMS has the advantage of being a mutually exclusive and collectively exhaustive way to divide the AMD market. This segmentation also provides a distinction between those tools that support the definition of objects and relationships (MDD tools) and those tools that support the definition and execution of conditions and actions (BRMS tools) that surround these objects.

IDC December 2005

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AMD Definition

• The AMD market is split into

– MDD

– BRMS

• MDD

– Formalized modeling methodologies and technologies

– UML (SDL)

– BPMN

• Telelogic in MDD

– TAU G1 & TAU G2

– SYSTEM ARCHITECT

– Rhapsody

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MDD Summary

The model-driven development (MDD) submarket is one of two submarkets that together make up the analysis, modeling, and design (AMD) market. The MDD market regained a measure of growth in 2004 after a dismal 2003. Revenue for the MDD market was $507.5 million in 2004 with annual growth of 4.9%. The calendar year 2004 must come to vendors as a relief after the slight negative growth of -0.9% witnessed in 2003. While the MDD market does not show overt signs of consolidation, the top 5 vendors account for nearly 60% of the MDD revenue, although just 2.3% of the overall market growth. IDC expects the MDD market to begin an era of sustained higher growth. This growth will likely be shared among the market leaders, which include IBM, Telelogic, Borland, Computer Associates (CA), and Sybase. We also anticipate that Microsoft will see significant growth of its MDD tools along with other vendors with discrete yet clear value propositions linked to business process management and the configuration and orchestration of deployment side services.

IDC December 2005

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MDD Summary

• MDD was $507.5 million in 2004

• MDD market got back into growth after couple of weak years

• 2004 growth rate @ 4.9 %

• Market place still fragmented

– 5 largest account for 60% of the market

• Market started to consolidate in 2005

– Telelogic acquisition of Popkin Software

– Telelogic acquisition of I-Logix

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MDD Players

Revenue in the worldwide MDD market is concentrated with the top 5 vendors.

Although Table 1 shows Telelogic and Popkin Software as separate companies (which they were in 2004), this discussion will recognize the 2005 acquisition of Popkin by Telelogic.

Consequently, there are five MDD vendors with revenue in excess of $20 million and a significant revenue gap between Sybase, the fifth ranked vendor, and the sixth ranked vendor.

The top 5 MDD vendors are IBM with $156.9 million, Telelogic/Popkin with $38.5 million, Computer Associates with $37.5 million, Borland with $37.0 million, and Sybase with $23.7 million.

IDC December 2005

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MDD Players

• IBM still the market leader

• Telelogic strengthening its second position

• With Popkin & I-Logix acquisition Telelogic will be close to 1.5x the next competitor

• Telelogic will have unique and domain specific solutions for

– Systems Engineers

– Embedded Software Engineers

– Application Enginers

– Enterprise Architects

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Market Share Embedded Software Systemsaccording to VDC

Source: VDC Embedded Software Design Tools Sep2005

2004 Embedded Software Systems

Software Modeling Tools and Services Revenue

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SCM Summary

IDC’s initial top-down assessment of 2004 revenue in the software configuration management (SCM) tools market resulted in a worldwide market sizing of $989 million. Our final, bottom-up tally shows worldwide SCM market revenue of $1.062 billion, representing an increase of 10.4% over 2003’s market revenue of $962 million, strong growth by any measure.

IDC March 2005

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SCM Definition

SCM tools are used by application development organizations to provide software revision control and versioning capabilities. More sophisticated functions such as process management, change request tracking, requirements management, and distributed team development support may also be included.

IDC March 2005

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SCM Players

IBM remained the clear market leader, posting 7.4% growth in revenue to $366 million, for a 34.5% share of the overall SCM market.

SERENA, whose acquisition last year of rival Merant made it the second-largest SCM vendor, grew revenue by 2.2% to $206 million for a 19.4% share.

Computer Associates continued in third place with a 12.9% share, up 6.1% from 2003 to $139 million.

Telelogic posted 23.6% growth to $89 million for an 8.4% share of the market as the fourth-largest SCM vendor.

Borland also grew strongly, up 29.8% to $64 million and a 6.0% share of the market.

The SCM market continues to be a mature and consolidated one, with these top 5 vendors accounting for 81.2% of market revenue (down slightly from 82.4% in 2003).

IDC March 2005

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ASQ Summary

The distributed segment of the automated software quality (ASQ) tools market was once again the growth leader across application life-cycle markets.

The distributed ASQ (DASQ) market grew to $780 million in 2004, an 18.5% growth over 2003.

IDC is now confident that the DASQ market will break through the $1 billion barrier sometime in 2006, on its way to revenue of $1.6 billion in 2009.

The criticality of software to the business, the increasing complexity of software applications and systems, and the relentless business pressures for quality, productivity, and faster time to market have all been positive drivers in the past and will continue to be in the foreseeable future.

IDC July 2005

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ASQ Definition

Examples of distributed environments include traditional client/server custom applications, ERP and other client/server packaged applications, and the full spectrum of Internet/intranet/extranet applications. Tools in this segment include functional testing, load or performance testing, regression testing, and QA process management tools targeted at distributed environments. Mainframe-based ASQ tools as well as those aimed at standalone PC or minicomputer environments are excluded. Also excluded are special-purpose testing tools such as those used for device driver testing, embedded systems, or voice applications.

IDC July 2005

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ASQ Players

Mercury’s strong performance in 2004 appears to be impacting the other ASQ leading vendors. IBM retained its second-place ranking, but with a decline in market share to 19.8%. This is a surprise given the strength of the Rational brand. Compuware kept its third-place position, but with a reduced market share of 7.9%. Empirix displaced Segue due to exceptional growth and secured the number 4 position with a market share of 3.5%, while Segue slipped into fifth place. While almost all vendors reported growth in 2003, four vendors experienced slight to significant declines in 2004.

IDC July 2005

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Analyst References

• Software and applications

– IDC

– Gartner Group

– VDC

• PLM/PDM

– AMR Research

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Summary of Market Data

Market Telelogic ProductsSizek 2004,

MUSD1

Actual Growth

2003-2004

Projected Growth/Year

2004-2009

Projected size2009,MUSD

Source

ALM

DOORS, FOCAL POINT, SYSTEM ARCHITECTSYNERGY, TAU

2356 9,2% 4089 IDC, Telelogic

SCM SYNERGY 1068 10.4% 8.5% 1646 IDC

ASQTAU TesterTAU Logiscope

780 18,5% 16,0% 1638 IDC

MDDTAU, SYSTEM ARCHITECT

508 4,9% 9,7% 805 IDC

RMDOORSFOCAL POINT

95,8 27,5% Gartner, Telelogic

PLMDOORS, FOCAL POINT,SYNERGY

777 1465 AMR Research

CNM DOORS, SYNERGY 259 14,0% 20,0% 624 AMR Research

PPM FOCAL POINT 518 10,0% 11,0% 842 AMR Research