EDA strong but design challenges persist

Electronic News, Jan 6, 1997 by Judy Erkanat

Mountain View, Calif.--The coming year bodes well for electronic design automation (EDA) vendors. Issues like design reuse, dissemination and protection of intellectual property (IP) and a continuing trend of mergers and acquisitions dominate the minds of the industry's top executives as business grows and customers clamor for deep-submicron and system-on-a-chip design methodologies.

"EDA is going gangbusters," said Will Herman, CEO and president of Viewlogic Systems. "EDAC is talking a 30-35 percent growth rate over the next year. It is hard to delineate service versus product growth, they are so intertwined. Our service grew 100 percent in 1996 and we expect the same in 1997. I think by implementing systems, EDA vendors become natural service providers."

Mr. Herman felt tool growth in the overall marketplace will reach 20 percent.

"The market is pretty strong," agreed Walden C. Rhines, president and CEO of Mentor Graphics. "In order to maintain its double-digit growth rate, EDA has some tasks to take on. More than ever, systems designers feel paced by their ability to get designs out. These used to be manufacturing and yield issues. In 1997, capacity and leading-edge technology are there, what is lacking are tools to take advantage of the leading-edge capacity."

Mr. Rhines said EDA needs to tie simulation to actual physical layout and debug the design with embedded software for hardware/software co-design. The biggest requirement is to acquire and support IP from a variety of sources.

Cadence Design Systems' Joseph Costello is also optimistic about the coming year.

"1997 will be a good year for EDA, and Cadence, because there are a lot of design challenges needing to be resolved now," said Mr. Costello, Cadence's president and CEO. "No more delays are acceptable. This centers around the return of physical design as king. Physical implementation was taken for granted for awhile. Performance and timing are deep-submicron physical design problems semiconductor manufacturers need solved to take advantage of the multibillion-dollar fabs they are building."

He noted Cadence's late 1996 mergers as preparation for new deep-submicron design technology, while problems like timing, crosstalk, signal integrity and thermal problems, all constraints of high-speed printed circuit board (PCB) design, create a retooling opportunity.

"It's what I call the 'three Cs,' " said Aart de Geus, head of Synopsys. "Computers meeting communications under a consumer umbrella. Starting from complex products like digital telephones and photographic equipment, all have very complex, digital ICs and are used in very compact systems. System-on-a-chip is a reality at 500,000 to 1 million gates. In the coming years, we will see more modules, sourced from multiple companies, as IP becomes more important, and system-on-a-chip and design reuse evolve into dominant themes."

Dr. de Geus said the issues around reuse were how to build modules versatile enough to be reused and easily migrated from one silicon technology to another.

"The frequency of industry cycles is spacing out," observed Keith Lobo, president and CEO of Quickturn Design Systems. "The industry has moved to a more steady-state model, indicating it is maturing. Electronics is a global commodity, heavily IP-based. A lot of EDA success is being in the right place at the right time, although the industry is somewhat cyclical, and those who are not in the right place at the right time can still reinvest."

He said EDA software leaders can change overnight. "EDA has a finite-sized customer base and we are a producer-goods industry, high up in the food chain," said Mr. Lobo. "So technical solutions always dominate. IP is an area where the EDA leaders could run into problems. Customers are uncomfortable with EDA companies taking over their IP. I think some EDA companies will become system design companies, creating the opportunity for pure-play EDA companies with great tools and the expertise to use them."

"EDA is growing at an increasingly faster rate," said Alan Gorlick, CEO of VEDA Design Automation. "Is the EDA content in technology growing faster or is the technology growing with EDA as an associated part? For EDA to grow faster than technology, we need to simplify usage."

"I believe 1997 will be a good year," said Jim Plymale, VP of marketing at OrCAD. "Two major shifts are the platform shift from Unix to NT, which I see accelerating in 1997, and FPGAs as a key technology replacing ASICs in design implementation. EDA is a replacement market; platform and methodology. I also believe the Internet will play a prominent role in EDA next year, allowing access to reusable IP."

Industry analysts also cited IP and reuse as key 1997 themes.

"The IP business will emerge as a real proposition for users and suppliers of reusable blocks," said Rita Glover of EDA Today. "A lot of work is needed on standards, and users will find it speeds products to market. This goes hand-in-hand with component information systems (CIS) and I see these as two major new trends in 1997. I also think the trend toward NT will continue."