Derek MillsThe IoT Platform We Built On Just Got Sold to a German Giant - And Nobody Warned Us
February 16, 2026
In March 2025, Siemens completed the acquisition of Altair Engineering for approximately $10 billion. Done. Closed. Altair shareholders got their $113 a share - a 19% premium over the pre-rumor price - and just like that, a platform that thousands of engineers, developers, and product teams had built on top of now belonged to one of the oldest, largest industrial conglomerates in the world.
I want to be direct about my take here: this is not good news for small and mid-size businesses who chose Altair precisely because it wasn't Siemens. And the broader lesson it forces into the room - the lesson that the IoT platform market has been trying to dodge for years - is one that people running B2B operations absolutely cannot keep ignoring.
You don't own the platform you build on. You're renting ground that other people can sell from under you.
What Actually Happened
On October 30, 2024, Siemens AG announced its agreement to acquire Altair Engineering for a deal value of $10.6 billion. Since its founding in 1985, Altair had been at the forefront of delivering advanced software and cloud-based solutions for simulation, IoT, high-performance computing, data analytics, and artificial intelligence. That's four decades of building a recognizable independent identity in the industrial software space - gone, absorbed into a company with 312,000 employees and €75.9 billion in revenue.
The addition of Altair technology to the Siemens Xcelerator open digital business platform was billed as creating the world's most complete AI-powered portfolio of industrial software. With this acquisition, Siemens extends its leadership in simulation and industrial artificial intelligence by adding new capabilities in mechanical and electromagnetic simulation, high-performance computing, data science and AI.
Sounds great if you're a Siemens shareholder. Less great if you're a team of twelve people running IIoT workflows on Altair's platform who now have to figure out whether Siemens is going to fold your tooling into Xcelerator, deprecate the product line, or just change the pricing structure until you move on voluntarily.
Those three outcomes have a name. It's called getting absorbed. And it happens constantly in this space.
This Isn't a One-Off. This Is the Pattern.
Here's what's been quietly happening in the IoT platform market over the last few years, and why I think the Altair-Siemens deal is just the loudest recent example of a much bigger structural problem.
In November 2021, an IoT Analytics analysis found that the IoT platform market had started to consolidate. With 12.2 billion IoT connections reached that year - and not the 50 billion that Ericsson had projected - it had become clear that the once-appealing blue ocean opportunity had turned into a red bloodbath, with the ocean becoming more like a lake.
Then it got worse. In August 2022, in a shock announcement to many customers, Google Cloud exited the IoT platform market, leaving customers scrambling for alternatives. Other notable exits include Germany-based enterprise software company SAP in 2022, US-based IT hardware and software company IBM in 2023, and Germany-based technology and services company Bosch in 2024.
Google. SAP. IBM. Bosch. That's not a list of startups that ran out of runway. That's a list of some of the most well-capitalized technology companies in the world - all of them deciding that running an IoT platform wasn't worth it anymore and leaving their customers to figure out the migration on their own.
And then there's Relayr. In 2018, Germany-based IoT platform provider Relayr was acquired by Munich Re, a Germany-based insurance group, and began focusing on customized IoT business outcome solutions. The company's operations ceased in July 2025. Acquired by a German giant. Then shut down entirely. That's the version where the acquisition story doesn't even end in absorption - it ends in nothing.
I mentioned this to Tory in the break room and he said something like "well, maybe it was their time to move on." He meant the platform. I think he was actually talking about himself. He's been very zen lately since his car got repossessed. But still - no, Tory. "Their time to move on" is not what we call it when a vendor shuts down and leaves enterprise customers rebuilding from scratch.
The Market Consolidation Nobody Wants to Admit
Here's the thing the IoT trade press keeps soft-pedaling: the hyperscalers have already won the middle of the market, and smaller platforms are either going to get acquired by industrial giants or disappear entirely. There's almost no third option.
In 2024, the top 5 hyperscalers - Microsoft, AWS, Huawei, Alibaba, and Oracle - held 60% of the total agnostic IoT platform market. This represents a significant increase from 39% in 2020, underscoring the substantial consolidation of the IoT infrastructure stack around hyperscalers.
That 21-point shift in four years is brutal. The $11 trillion IoT market potential projected for 2025 has fallen short of expectations. While IoT adoption advanced over the last 10 years, the market for IoT platforms has gone from a potential "blue ocean" to a "red lake," as the complexity of IoT deployments proved to be a key inhibitor to scaling and many end users did not see enough tangible value with a horizontal IoT platform.
This is the part that actually matters for anyone running a B2B operation that touches connected hardware, factory data, device management, or anything in the industrial stack. The landscape you thought you were building on has been restructuring underneath you for years. The vendors that didn't get acquired by a hyperscaler are increasingly getting acquired by industrial giants like Siemens - which is a different kind of problem, because the transaction was expected to strongly increase Siemens' digital business revenue by +8%, adding EUR ~600 million to Siemens' existing digital business revenue. Siemens expected to achieve significant revenue synergies especially from cross-selling of the highly complementary portfolios.
Cross-selling. That's the word that should make every existing Altair customer's stomach drop a little. What cross-selling means in practice is that Siemens now has a financial interest in getting you deeper into the Siemens ecosystem. Your standalone Altair relationship - the one you chose specifically because it was nimble and independent - is now a sales channel for a company with a €75 billion revenue base and 15 years of building toward industrial software dominance.
Stephanie asked me what the big deal was. She said Siemens is a "reputable company" and that it probably means "more resources for the platform." I love Stephanie but she paid more for her parking spot last year than most small manufacturers pay for their entire IoT stack. This isn't about reputation. It's about what happens to pricing, roadmap priorities, and support SLAs when you become a sub-feature of a global conglomerate's cross-sell strategy.
The Last Jedi Problem (Stay With Me)
Everyone treats platform acquisitions like they're the beginning of a stable new chapter. The acquirer announces "exciting synergies," the acquired company sends a reassuring email to customers about "continued commitment," and everyone relaxes. This is exactly what happened in The Last Jedi when the Resistance thought they'd escaped the First Order by going into hyperspace - except the First Order had figured out how to track them through it. The threat didn't go away. It just changed form.
Every IoT company that got absorbed by a corporate giant went through the same cycle. Reassuring press release. Roadmap "alignment." Pricing changes. Feature deprecation. And eventually, the customers who'd built significant operational dependencies on the platform are left making hard choices they didn't budget for.
In 2023, Germany-based industrial automation company Siemens' Mindsphere rebranded as Insights Hub and shifted its focus from becoming the "operating system for IoT" to a software application for manufacturing excellence. That's Siemens' own IoT platform - the one it had been developing for years - quietly repositioned from a horizontal play to a narrower vertical one. When Siemens couldn't make its own platform into the thing it promised, it spent $10 billion to buy someone else's. Altair's customers are now inside that same decision-making orbit.
I've been saying The Last Jedi is the most ambitious Star Wars film ever made for approximately two years and I keep getting that look. Chris gave me that look this morning when I brought it up at the coffee machine. He's gorgeous and means well but he doesn't understand that narrative ambition and comfort are not the same thing. Neither does the IoT industry. Acquisition announcements are designed to feel like comfort. That's not the same as safety.
What This Means If You're Running a B2B Business Right Now
The SaaS world has been talking about this risk for a while - we've written about the broader vendor consolidation wave and the SaaSpocalypse dynamic hitting B2B software stacks. But the IoT platform version of this problem is meaningfully worse, because the switching costs are not just about data migration. They're about re-engineering physical infrastructure. Device firmware. Network topology. The APIs your operations team has been using for three years.
When a CRM gets acquired, you're annoyed and you start evaluating alternatives. When your IoT platform gets absorbed into a $10 billion industrial software empire, you're potentially looking at months of engineering work and real operational downtime.
The companies that are going to come through this wave of consolidation in the best shape are the ones who built with abstraction layers and didn't let a single platform touch every part of their stack. Rather than building on top of a generic platform, enterprises that plug into tested, ecosystem-driven applications can reduce integration risk and speed up time to value. The proliferation of connected apps demonstrates how IoT value is increasingly captured at the application layer, not the underlying platform. That's actually good strategic news if you're structured for it. It's catastrophic if you're not.
Linda told me her husband Gerald spent twenty years building his logistics business on a proprietary freight management system that got acquired by a private equity firm in 2019, repriced aggressively in 2020, and essentially held them hostage until they rebuilt. She said he never talks about it. She said it almost broke him. Linda always brings up Gerald at exactly the right moment.
The other thing worth tracking: even in 2025, there remain several hundred IoT platforms, many of which have given up on the vision to be the all-encompassing IoT platform for everyone but instead are focusing on a set of use cases and/or industries. That verticalization is actually the safer bet for customers right now. A platform that's deeply embedded in, say, predictive maintenance for mid-size manufacturing isn't going to get acquired by Siemens because it doesn't have the cross-sell surface that Siemens is looking for. Niche is protection.
The Siemens Story Isn't Over
The transaction will increase Siemens' digital business revenue by over 8 percent, adding about EUR 600 million to its existing digital revenue base. Siemens expects to achieve significant revenue synergies, especially from cross-selling of the highly complementary portfolios and from providing Altair full access to Siemens's global footprint and global industrial enterprise and customer base with a revenue impact of more than USD 500 million per year mid-term.
Five hundred million dollars a year in mid-term cross-sell revenue. That number tells you exactly where Siemens is focused. They're not focused on preserving the scrappy, independent experience that Altair's smaller customers loved. They're focused on unlocking the enterprise accounts. The smaller customers aren't being thrown out - they're just not the point.
Being "not the point" for a company trying to hit $500 million in new cross-sell revenue has predictable consequences. Feature requests that don't serve enterprise manufacturing use cases go to the bottom of the queue. Pricing tiers restructure around enterprise seats. The integrations your team relies on get deprioritized because Siemens Xcelerator has a preferred pathway.
This is what I think happens in the next 24 months: the Altair-native customer base fractures. Enterprise manufacturers get absorbed into the Xcelerator ecosystem, which is probably fine for them - all Siemens customers, from engineers to generalists, will have access to new simulation expertise and can optimize their high-performance computing processes, which is a real benefit for large-scale industrial operations. Mid-market and smaller teams start migration conversations they didn't plan for and didn't budget for. Some of them end up on AWS IoT or Azure IoT because that's the path of least resistance. Some of them find the niche vertical platforms that are now actually better fits. And a few of them get stuck.
The ones who get stuck are the ones who treated their IoT platform like a permanent foundation instead of like a dependency with a risk profile that needs to be actively managed.
Jamie floated the idea in our last team meeting that maybe we should just "see how it plays out." Nobody calls him by his name for a reason. You don't "see how it plays out" with infrastructure decisions. You make the call before the call gets made for you.
The Siemens-Altair deal is done. The Relayr shutdown is done. Google's exit is done. SAP's exit is done. IBM's exit is done. Bosch's exit is done. The IoT platform consolidation is not a future risk to monitor - it's a present condition to operate inside of. If your B2B operation runs on connected devices and your platform dependency hasn't been audited for acquisition risk in the last twelve months, that's the actual gap to close right now.
Not next quarter. Now.