ZWSoft Acquires VX and Targets the 3D Market

Chinese developer ZWSoft hopes to displace AutoCAD in China. Now,  ZWSoft has acquired VX Corporation and plans to take advantage of the VX Kernal to develop new products. The VX line will also continue. China is building homegrown products to compete at home and abroad.

It’s the busy season for CAD. Autodesk and Dassault have been playing tit-for-tat pitting SolidWorks against Inventor. Siemens is reviving its Solid Edge division with new personnel and development. And Autodesk has completed its end run strategy to the Mac and the Cloud with AutoCAD for the Mac and AutoCAD WS for online collaboration. Meanwhile, back in China, ZWSoft has been selling its latest release, ZWCAD 2010 as a competitor to AutoCAD and has announced it will debut a new product, ZW3D.

ZWCAD has emerged as a strong Chinese competitor to the entrenched AutoCAD. Using the open source IntelliCAD engine, ZWSoft has developed ZWCAD to compete head to head with Autodesk’s AutoCAD and AutoCAD LT in the Chinese market and the rest of the world. The software reads and writes DWG, AutoCAD’s native format. In the latest release of ZWCAD 2010, ZWSoft offered a feature-by-feature list comparing its product to AutoCAD and AutoCAD LT. As you might expect, the products line up rather well according to the list on the site.

In late August, ZWSoft announced the acquisition of venerable 3D CAD software developer VX Corporation. The company was founded in 1985 and offers 3D modeling and surfacing products for CAD/CAM. The company’s line of products from low cost modeling to full featured hybrid modeling products are strong in CAM and competes with Alibre, among others.

ZWSoft announced that the VX development team will continue the VX product line from its headquarters in Florida as a subsidiary but it will have additional resources from the ZWSoft development team headquartered in Guangzhou. In addition, ZWSoft will take advantage of the VX Kernel to develop ZW3D, a tool for mechanical design and engineering and offer it “at a fraction of the cost of other comparable systems.”

A comparable system worth mentioning at this point is IronCAD  because it has a similar story. After an infusion of cash, IronCAD is being further developed by IronCAD’s Georgia-based team and Chinese PLM developers CAXA.

The Really Big Picture

ZWCAD has gotten good reviews as a competitive product to AutoCAD. Reviews of earlier versions were criticized as being slower than AutoCAD especially for large drawings and drawings with a lot of AutoCAD specific elements to translate. On ZWSoft’s website, longtime CAD journalist and author Ralph Grabowski offers a terse white paper that says ZWCAD’s DWG fidelity is quite good.

However, given the generally positive reviews of ZWCAD, it’s reasonable to assume that its performance and fidelity is acceptable for most situations where AutoCAD or AutoCAD LT is a stand-alone choice.

The larger question is whether ZWCAD can displace AutoCAD in China and maybe even the rest of Asia. It is certainly going to give Autodesk some headaches and it has gained ground. Just recently Carl Bass used the forum of Forbes magazine and the Autodesk quarterly financial call to complain about China’s disinterest in Western intellectual property rights. He said that as China developed its own technology, perhaps it would show more interest in protecting its own IP. As an aside, there are cracked versions of ZWCAD available on the web.

While Autodesk is on solid ground with large multi-national companies, which will prefer to use standard software and take advantage of extensive service and support contracts, ZWCAD has a competitive position with small companies around the world. However, in situations where companies use a variety of Autodesk products, third party add-ons and even products from CAD competitors including Bentley Systems, AutoCAD will be the preferred choice because it promises smoother workflows between different products.

With the acquisition of VX Corporation, ZWSoft has made clear that it has ambitions to challenge the competition in 3D modeling as well. VX Corporation’s products are hybrid modelers taking advantage of both parametric technology and direct modeling technology.

Autodesk is not the only target in the CAD market, it’s just the largest.

And finally, there is a much larger trend here. CAD is far from the only battlefield. China is working to compete with the West on every front. There are several obvious examples. Chinese manufacturers were thwarted sending DVD machines to the West because they were not licensing the DVD codecs. In response, China developed its own DVD codec to sell machines in China. China blocks the sale of game consoles and console games to China and just recently, a spinoff from Lenovo named Eedoo was formed to develop the eBox, a game console for the Chinese market. The console will include capabilities similar to Microsoft’s Kinect, which enables direct game interaction on the Xbox 360 via camera rather than buttons. And then there’s the mobile phone market. There’s a very good reason why the open and free Android operating system is a big hit among Chinese phone makers. It provides a base for Chinese handset manufacturers to compete head-to-head with manufacturers in China and around the world.

ZWCAD Screen Shot
ZWCAD developed by ZWSoft is yet another competitor to AutoCAD and AutoCAD LT. It's also part of a larger strategy to develop homegrown products

China has a dual strategy. It is building products to compete in the West and at the same time it is building a mirror economy in China where Chinese products are sold to the growing masses of Chinese consumers. It seems likely that as China’s economy grows, and if it is successful in building a preference for homegrown products, it has less need to play ball with the West. Rather, it can concentrate on building its influence among its Asian neighbors and partner countries in Africa and the Middle East.

It’s a long range plan, and China isn’t necessarily banking on this scenario. The main ambition is to build a strong Chinese economy based on Chinese products. But, as world domination strategies go, having a population of 1.3 billion or so isn’t a bad backup.