Model-Based Enterprise Market Size, Share & Trends Analysis Report By Offering (Solution, Services), By Deployment Mode (Cloud, On-premises), By End-User Industry (Aerospace and Defense, Automotive, Construction, Power and Energy, Retail, Other End-user Industries) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global model-based enterprise market had a revenue worth USD 16.12 billion in 2022. It is expected to reach USD 82.55 billion by 2031, growing at a CAGR of 19.9% during the forecast period (2022-2031).

Model-based definition (MBD) includes a comprehensive definition of the product in a 3D design. Model-based enterprise (MBE) is utilizing these models across the extended enterprise. Model-based enterprise solutions that can assess product shapes in real-time have been developed and adopted with the growing adoption of 3D technology across numerous industry verticals to meet the growing demand for emerging applications, including shape analysis, 3D modeling, and many more. The technology opens up a wide range of possibilities for creating new architectural shapes, building systems, and other things and for the design and production processes. This product creation and production approaches are creative, quick, and agile.

To improve, automate, and modernize processes, Industry 4.0 has introduced digital technology. Since 3D technologies, in particular, provide outstanding advantages, particularly in the discrete manufacturing industry, they are frequently integrated with other technologies. A demand for model-based enterprise solutions in the construction sector is anticipated to result from the growing investment in innovative city initiatives. As a result of the many advantages that model-based business technology adoption offers, product designers can experiment with alternative ideas and see potential design difficulties early on.

Market Dynamics

Global model-based enterprise market drivers

Changing Software Features and the Deployment of IoT

Creating software and constantly upgrading it to include new features or removing outmoded functionality are examples of evolving software capabilities. The evolution process includes change analysis, release preparation, implementation, and delivery to customers. Numerous vendor innovations solve many problems businesses encounter when digitizing the design process and transitioning from 2D to 3D. For instance, Siemens Digital Industries Software released the most recent iteration of NX software in November 2020. This version included features that allowed businesses to use knowledge- and rule-based approaches to model-based definition, which incorporate best practices and use artificial intelligence to significantly increase productivity.

Cross-platform software development platforms, including Google's Flutter and Microsoft's Cimarin, are among those that are now on the market and will enable the development of mobile and desktop applications. These improved technologies will be able to utilize native APIs and user interfaces to their full potential. Several development platforms have already included AI capabilities to increase development speed and ease. The market demand for the model-based business market will be driven by this integration of AI capabilities. Players in the market are also promoting investments in numerous cloud-based applications and supporting the streamlining of the technological infrastructure, allowing for the management of data, services, and workflows across numerous clouds and on-premise platforms.

Additionally, IoT has been viewed by businesses and service providers as the critical enabler to accelerate digital transformation and unleash operational efficiency. The market for model-based enterprises is predicted to experience higher growth for cloud-native solution offerings due to the rising need for workload deployment over the cloud. AI is anticipated to be one of the critical elements of cloud offerings among IoT software and platforms, which are projected to be a widely accepted and offered component in the industry. The manufacturing sector is projected to be at the forefront of IoT and cloud-based platforms due to high adoption rates and an increased predisposition for digitizing operations. These elements encourage the model-based enterprise market to grow.

Global model-based enterprise market restraints

Shift from On-premise to Cloud-based Platforms

Cost reductions are the main reason for switching from a typical on-premise enterprise data warehouse to the cloud. The overall expense consists of the direct cost of owning or leasing data center equipment and charges for third-party services, maintenance and management, instruction, and policy. These indirect expenditures can significantly influence the price of running on-premise data centers. Consequently, the market for model-based enterprises is restrained. On-premise computing infrastructure also needs space, building materials, electricity, air conditioning, hardware acquisition, operating systems, networking, and physical security, among other things. Model-based enterprise vendors are now outsourcing these expenditures to a cloud service provider to cut costs. Many businesses that have on-site data infrastructure are worried about security.

Global model-based enterprise market opportunities

The Acceptance and Use of Digital Twins

A significant potential for the model-based enterprise market growth rate during and after the forecast period is the massive increase in awareness and acceptance of digital twins. A virtual representation of a physical system, item, or design is called a "digital twin." They are the MBE building blocks independent of static data and designs. A multifunctional scope and the concept of a Product Digital Twin, which can take into account process, production, and service, are necessary for having a comprehensive Digital Twin.

For larger projects, digital twins combine data from several apps and user categories, improving cost savings. The Clean Energy and Smart Manufacturing Innovation Institute (CESMII), the Digital Twin Consortium (DTC), GAIA-X, the Industrial Digital Twin Association (IDTA), the Industrial Internet Consortium (IIC), the Open Industry 4.0 Alliance, the Open Manufacturing Platform (OMP), and Platform Industry 4.0 are the organizations that are making contributions to the digital twin technologies.

Regional Analysis

The region-wise segmentation of the global model-based enterprise market includes Latin America, North America, Europe, Asia-Pacific, and the Middle East & Africa.

North America and the Asia Pacific will be dominating the regional market.

North America will likely develop at a CAGR of 16.6% and command the regional market during the forecast period. GE, PTC, Autodesk, Aras, and other prominent companies are present in the North American region, which is expected to account for a sizeable portion of the worldwide market for model-based enterprises. These businesses have been using numerous growth strategies to enhance their competitive position in the market. In addition, organizations like the Digital Manufacturing and Design Innovation Institute (DMDII) have the skills, innovative spirit, and collaborative expertise used to transform the American manufacturing sector by supporting the organizations and assisting in the digital revolution.

Modern manufacturing facilities in the United States use new technology and innovations to manufacture high-quality goods more quickly and cheaply. Manufacturers in the nation have been integrating these cutting-edge technologies to streamline their processes and exploit their deeper insights due to the early adoption of these modern technologies, such as IoT, big data, 3D modeling, DevOps, and Mobility. Additionally, the United States has one of the largest automobile marketplaces in the world and is home to over 13 significant automakers. Amongst the primary sources of income for the nation's manufacturing industry has been the production of automobiles, which has contributed to the expansion of the regional market.

The Asia Pacific is forecasted to have a shareholding of USD 19.8 billion, growing at a CAGR of 18.6%. The Asia-Pacific region is anticipated to experience the market for model-based enterprises to expand at the fastest rate, led by nations like Japan, China, India, Australia, and South Korea, among others. The manufacturing industry in the Asia-Pacific area is intended to grow as a result of programs like Made in China, Make in India, and others. Therefore, the penetration of digital technologies is examined to further contribute to the market growth rate

China is one of the key nations in the Asia-Pacific region with increasing technological adoption. The world's most cutting-edge advanced manufacturing facilities have been established as a result of China's announcement of a new five-year plan in March 2021, which identified the creation of seven necessary "frontier technologies" as the nation's top policy objective. Additionally, given the amount of new local players attempting to enter the model-based enterprise market during the projection period, growing marketplaces in nations like India are predicted to offer excellent potential for the industry.

Segmental Analysis

The global model-based enterprise market is classified based on the offering, deployment mode, end-user industry, and region.

Per the offering, the segments are Solutions and Services.

 The solution section is forecasted to have the highest revenue holding, expanding at a CAGR of 16.5%. Model-based enterprise (MBE) is an organization that uses Product Data Management (PDM) and Product Lifecycle Management (PLM) technologies to manage and distribute data outside of engineering in an MBD environment. The model-based design (MBD) tools used by end users to implement the MBE strategy expanded throughout the company are included in the solution category. Due to the growing use of data intelligence solutions, such as insight engines, the category is anticipated to have a sizable market share over the projected period and to expand gradually.

The service section will have the second-largest shareholding. Numerous services, including consulting services, support, maintenance, deployment, and integration, are included in the market's services sector. These services are given by market vendors as stand-alone services and an add-on that is integrated with the product offering. Typically, vendors include the cost of add-on services in the software subscription. Model-based enterprise vendors collaborate with numerous businesses that offer these services to customers on the vendor's behalf. They work with their professional services team to give their clients solutions.

 Per the deployment mode, the sections are Cloud and On-premise.

 The cloud section will likely hold the largest market share, advancing at a CAGR of 17.3% during the forecast period. With the popularity of cloud computing comes newfound flexibility for businesses, from time and money savings to increased agility and scalability. But when it comes to enterprise technology, several software solutions have switched to a cloud-only or cloud-best strategy, informing clients that they must rely on their cloud-based services if they want the newest and most impressive features. Public, private, cloud, and on-premise cloud deployments come in a variety, each tailored to a specific organization's requirements and the environment in which it operates.

 The on-premise section will have the second-largest share. The solution is installed on the business's servers for the on-premise implementation. When a business uses on-premise software, it signifies that it has purchased a license or a copy of the program. There is typically better protection than with a cloud computing infrastructure because the solution is licensed, and the entire instance of the software resides on the premises of an organization. Therefore, it is projected that throughout the forecast period, on-premise deployment will experience a significant increase.

 Per the end-user industry, the sections are Aerospace & Defense, Automotive, Construction, Power & Energy, Retail, and Other End-user Industries.

The automotive section is estimated to grow at a CAGR of 16.52% and hold the largest market share. The automotive sector has produced some of the most cutting-edge prototypes and products because it was one of the first to promote the development of widespread applications of model-based systems technology. As the main form of transportation, cars play a vital role in human existence. Additionally, model-based design is becoming more widely used by automakers worldwide in creating vehicle electronics, including body controllers, engine and transmission controllers, and battery management modules.

The aerospace & defense section will hold the second-largest share. An essential sector of the economy, aerospace and military make substantial investments in creating new technological solutions to foresee and adapt to changing customer needs. To satisfy these demands, aerospace and military industries implement digital business models that manage the entire product lifecycle, speed up product development, increase revenue creation, enhance efficiency, and boost supply chain performance. Additionally, MBE offers project participants real-time design and analysis, group process flow development, automated artifact production, and full-process traceability.

Recent Developments

• In 2022, Siemens has teamed with Hilscher, a top supplier of industrial communication solutions, to offer customers various adaptable communication solutions.