5. Software is free (or freemium)
I know this is provocative, but every time I hear about new software launches, the software is free or being offered as a service. This is driven from three directions. First, hardware manufacturers have learned that they can win designs if they give away the software and tools. Second, software startups aren’t taking VC money but are entering the market by bootstrapping development, then giving the code away hoping they can either up sell later or sell some form of service. Third, the open source movement has shown us that very useful code can be had for free (Android and FreeRTOS, for example).
Engineering software giants like Cadence, Mathworks, Mentor and National Instrument still using the license and seats model, but they are facing a shift in the underlying business model that is under pressure long term. The parallel in enterprise software is Oracle vs. Salesforce.com.
In the long term, I am betting on the cloud.
Can the cloud revive manufacturing?
Report: Turbulence ahead for cloud services