Siemens snaps up Mendix in smart factory move
(Credit: Siemens)

Siemens snaps up Mendix in smart factory move

Siemens execs hope to attract more users to the company’s Mindsphere industrial IoT (IIoT) platform with the acquisition of low-code, rapid application development platform Mendix, as Jessica Twentyman reports. 

Last week, German industrial group Siemens announced it was to acquire Mendix, a developer of a ‘low-code’ application development platform, designed to help business users build software without having to rely on IT experts.

The deal has a strong IoT focus: Mendix will become part of the software business within Siemens’ Digital Factory division, which focuses on selling smart factory technologies to manufacturing businesses. In 2017, revenues for this division were up 12% to €11.4 billion, making Digital Factory one of the fastest growing parts of Siemens.

Additionally, Siemens executives are hoping that the purchase of Mendix will help accelerate adoption of Siemens’ own IoT platform, MindSphere. This is presumably based on the idea that companies looking to build IoT applications quickly will be won over by the Mendix promise of ten-fold increases in application development times, and thus be drawn to Mindsphere in greater numbers.

Siemens is paying €600 million for Mendix and has also committed to what its executives call “a significant multi-year investment” in its new acquisition, in order to accelerate its R&D and take the platform into new parts of the world.

Big claims, unfamiliar territory

According to a rather grandiose claim made by Mendix CTO Johan den Haan, the deal will “redefine the future of application development.” There’s clearly a great deal of hyperbole at play here, but the deal is interesting.

It certainly looks set to take Mendix into some fairly unfamiliar territory, when one takes into account Siemens’ laser-like focus on industrial IoT settings. After all, Mendix is a far more general-purpose technology company.

Founded in Rotterdam in 2005 and now headquartered in Boston, Massachusetts, it has based its business on the notion that business users don’t have the time or resources to hang around waiting for application development specialists to build new apps for them. They want to get building themselves.

With this in mind, the Mendix platform works by placing an abstraction layer between the non-technical person and the code they’re putting together, with easy to use drag-and-drop capabilities, pre-built widgets and templates.

This underlying message has seen Mendix work with a very wide variety of customers in the past, including charities, art galleries and local government organisations, as well as large corporates. Many of these projects have focused on the development of mobile apps and online platforms, with IoT applications a relatively recent focus.

That said, Mendix can boast some interesting IoT customers. For example, there’s Hortilux, a manufacturer of connected LED lighting for greenhouses, which used the platform to build its Hortisense online portal for commercial growers, where they can get an at-a-glance view into lighting efficiency. Similarly, construction company Heijmans used Mendix to build its BeSense smart building for monitoring and managing occupation rates and space utilisation in office buildings.

But it remains to be seen how Mendix will fare in a very different business environment, in which it will no doubt be expected to step up its smart factory game.

Massive overhaul

Siemens, meanwhile, has plenty on its plate right now. The news of the Mendix acquisition came just one day before Siemens chief executive Joe Kaeser announced a massive overhaul of company structure that will see it shrink its number of operating divisions from five to three. These will be Gas and Power, Smart Infrastructure and Digital Industries.

The good news, at least, is that the Digital Factory unit will doubtless continue to get plenty of attention as it moves into the Digital Industries operating division. For its just-announced third quarter, Siemens’ profits were helped by another strong performance by Digital Factory, which compensated for a slump in the more traditional, but troubled area of power and gas.

Commenting on the Mendix acquisition, Jan Mrosik, chief executive of Siemens Digital Factory division said: “As part of our digitalisation strategy, Siemens continues to invest in software offerings for the digital enterprise. With the acquisition of Mendix, Siemens continues to add to its comprehensive digital enterprise and MindSphere IoT portfolio, with cloud domain expertise, cloud-agnostic platform solutions and highly skilled people.”