Consultations have been held with the Commission regarding the following matters:
The manufacturing industry is witnessing a significant shift with the advent of the Product-as-a-Service (PaaS) model. This new business paradigm, initially adopted by companies like Trumpf, Heidelberger Druckmaschinen, Volvo, Mercedes, BMW, Gillette, and HP from the early 2020s, promises to redefine the way products are sold and used.
Under the PaaS model, customers are offered services such as machine subscriptions with predictive maintenance, car subscriptions, and consumable replenishment services. This shift allows customers to preserve liquidity by turning one-time capital costs into regular operating costs.
The customer's readiness to have their usage behavior monitored by the provider is a prerequisite for this model. The product at the customer's site must be connected, usually via an IoT platform, to track its usage, bill accordingly, and enable the provider's operational tasks.
The provider's revenues become more predictable due to the recurring revenues generated from the PaaS model. The required infrastructures and technologies, including IoT platforms, are already in existence. Industry-specific digital architectures are currently being developed to support this new model.
PTC is an example of a company implementing innovative strategies for PaaS to meet customer demand. The provider's readiness to shift the established business model is a prerequisite, along with a temporary acceptance of lower revenues.
The PaaS model fosters more intensive customer-provider relationships due to recurring transactions. Shared success and risk exist between the customer and provider in this model. Continuing with the classic business model (direct or indirect sale of the product to the customer) remains an alternative.
The market readiness for the PaaS model is assessed as 3 to 4 on the maturity levels scale. First offers have been available for some time, and the provider's revenue model changes to one based on recurring revenues. Customers rent products from providers for a fee, known as Pay-per-Use.
The PaaS model is initiating initial pilots with selected customers, and its potential to revolutionise the manufacturing industry cannot be overstated. As more companies adopt this model, we can expect to see a more connected, efficient, and customer-focused manufacturing landscape.
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