An article in Chip Design Magazine announced the GSA’s formation of a working group “to focus on identifying EDA solutions for emerging companies with the goal of promoting and encouraging the availability of EDA programs and tools for emerging companies”.
As we’ve been saying at Xuropa for a long time now, the next big challenge for the semiconductor industry in general and EDA specifically is not the move to the next process node, but how the industry does business. (Fundamentally, this is why we built the platform.)
The supply chain is stretched thin and the cost of doing business in a globally distributed industry has become prohibitive for start-up and emerging companies. This systemic problem is exacerbated by the downturn in the economy and the significant decrease of the availability of funding.
The GSA working group is in fact-finding mode holding educational meetings with Synopsys, Mentor, Cadence and Magma to understand their start-up programs and to give them feedback.
As we see it, the main business challenges faced by emerging and established EDA companies are similar when faced with the opportunity of addressing start-up semiconductor companies.
Emerging EDA companies struggle to create a sales channel to penetrate and support the industry globally. And so they focus their limited resources on the large semiconductor vendors. They’ve already made the calculation and learned from experience that although a start-up semiconductor company appears to move quicker, take less support and therefore be attractive as a target customer, it’s not actually the case. For many reasons, the cost model and the “time-to-money” ends up about the same between start-up and established semiconductor companies.
For an established EDA company, it’s a similar matter of costs. Making tools available at reduced rates is a good way to “bet” on and invest in start-up semiconductor vendors. It’s a great way to build a relationship and become established in what could be the next “Broadcom”…or acquire-ee of Broadcom. However the challenge is support and its associated cost. No longer are these start-ups all hunkered down in a “garage” in Santa Clara. They’ll have some development in Silicon Valley, but mostly just sales and marketing. The majority of development is increasingly done in India, Eastern Europe or elsewhere. When large EDA companies are feeling the pinch themselves, I can see why support of these smaller guys (in narrower and narrow niches) is a difficult cost to justify.
There needs to be a different model.
EDA tools need to be available and supported remotely to reduce the cost of sales and support. Fortunately we have different solutions and concepts that can assist.
“Cloud Computing” has started to be defined generically, and it’s going to take some time to evolve into a recognized model for the semiconductor industry. However, a Xuropa Online Lab provides the ideal sales and support structure for established and emerging EDA companies. An Online Lab enables companies to address a global market remotely providing training, workshops, demonstrations and evaluation of EDA tools.
“Software-as-a-Service” (SaaS) and “Service Oriented Architectures” (SOA) are related to Cloud Computing (but not necessarily linked). A SaaS model could be adopted by a start-up EDA company as it does not have such an entrenched business to protect as an established EDA company. A SaaS model does not dictate an immediate re-development of the tool to transform it into SOA either. However, an SOA-based EDA tool suite would be an attractive goal for delivering the value of an EDA tool chain at a much lower cost.
This is the direction that we at Xuropa see electronic design going and we’re building the platform and technology to support it.
If anybody would like to discuss this further and in person, please contact me via the Xuropa Community. Just register and send me an email from my Professional Profile.
What do you see as viable solutions to stimulate the semicondcutor industry?
Posted under Xuropa, business, industry
This post was written by James Colgan on December 3, 2008
