Squeezing the Homunculus – Try Something New

Several weeks ago, Tommy Kelly published a blog post entitled DAC and the VLSI Homunculus :

“To the unwary conference goer (and the EDA companies: my addition), the most important part of the VLSI design and verification problem, is tools. Choose the right tool, and you’ll be fine. Get it wrong, and you’ll never tape out a chip again…But far, far more important are the knowledge, skills, experience, and artistry of the people who use those tools. Peopleware, not Software or Hardware, is the most important VLSI body part.”

Having spent the last decade plus of my life in some way, shape, or form in the ASIC design consulting business, I could not agree with Tommy more. Never did my clients insist on using a particular tool. But almost always they’d ask for a consultant by name, because he had the “knowledge, skills, experience, and artistry” to get the job done.

And so, when I read the EE Times Story entitled EDA Vendors Get Squeezed on Two Fronts, I had to laugh. Here were the EDA vendors once again bemoaning the fact that the EDA industry is not able to “capture the value” (i.e. charge more for its products) that it justly deserves. The article referenced strategies such as royalties that have been rejected before. (After all, if you were a general contractor, would you pay a royalty to the company that made the hammer or the saw?)

Indeed, the EDA industry is largely a Cortical Homunculus, having a distorted view of how important it is to the success of it’s customers projects. Yes, the tools are a key enabler, but more important are the designers, the people using the tools. Through my years, I have had the honor or working with designers that I would take with me wherever I go, my A-Team. And it would not matter what tools they use, they’d be successful anyway they’d need to do it!!!

I’ve spent a good portion of the last year talking to people in the EDA industry, marketing people and sales people. They tell me things like the following:

  • EDA is a dying business
  • EDA companies are just trying to take market share from competitors
  • There’s very little new in EDA
  • All the innovation comes from the small companies

They are probably not listening to me, but just in case, here is my advice to the big EDA companies.

Try Something New!!!

Instead of stealing EDA share from eachother in the analog design or verification market, solve a new problem. Make our lives easier. In basic economic terms, there is only one type of company that “captures the value” of its offering, and that is the monopoly, the one-of-a-kind product that solves a must-solve problem.

harry the ASIC guy

(Postscript: I wrote this article prior to Cadence’s offer today to buy Mentor Graphics, but it relates to the same point. Instead of doing something new, the EDA vendor strategy is to take away, or in this case BUY, market share from its competitors.

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4 Responses to “Squeezing the Homunculus – Try Something New”

  1. JL Gray says:

    Try something new… what a novel concept! I’m wondering whether the proposed Cadence acquisition of Mentor would stiffle innovation (as if that hadn’t been done already) or perhaps encourage it, since now you’d see Synopsys and Cadence battling it out directly. Mentor has some good new products (inFact, Certe) and the two ortanizations are pushing the new OVM library. Synopsys is starting to take notice and now we see things like the open-sourcing of the VMM. In my mind, that’s progress already!

    Take care,


  2. Sean Murphy says:

    My uncle had a saying “it’s generally accepted, so generally accepted it may not be true at all.” I think this applies to all four of common beliefs you list:

    EDA is a dying business – No, it’s growing and it’s supporting an Electronics industry (not just semiconductor devices) that is contributing pervasively to the world economy.

    EDA companies are just trying to take market share from competitors – competitors are always trying to take market share from each other. But they are also stakeholders in growing the industry and there are new relationships and common efforts agreed to every month.

    There’s very little new in EDA – problems are getting harder across the entire design spectrum (cells/blocks to chips to boards to systems, all with software and IP challenges). You could take many enterprise applications from three to five years ago and do just fine, you would be much harder pressed to use the same version of a tool for five years and remain competitive. Witness in particular the explosion in new analog solutions, an area that was viewed as “stable” two or three years ago.

    All the innovation comes from the small companies – it’s harder for large companies to find and explore very early stage markets because of the challenges of managing large businesses for profitability and tin businesses for growth in the same company (ref. “Innovator’s Dilemma”).

    I do agree with your final point: insanity is doing the same thing over and over and expecting a different result; more vendors need to try new approaches.

  3. Hi Sean,

    Thanks for your thoughtful comments and for sharing your uncle’s wisdom. As he said, “it’s generally accepted, so generally accepted it may not be true at all.” In the back of my mind I have similar thoughts regarding the Cadence-Mentor merger since everyone is so against it. Part of me thinks it may actually happen and may actually be the right thing.

    To your points:

    1) EDA overall may be growing, but ASIC EDA is dying, IMHO. I read a report that a Toppan 32nm mask set will cost ~ $4M. And a 32nm chip will probably have 100M gates, including numerous embedded processors. How many product companies will be able to afford this and take the risk that their 100M gate chip won’t need several respins requiring new masks. Qualcomm…Broadcom…Cisco. Not too many. Can 10 customers support an industry? Ultimately, the shift will be to software which is a different class of EDA tool.

    2) Yes…taking market share has always been a strategy, but what about a Blue Ocean Strategy?

    3) The large ASIC EDA companies tend to have evolutionary enhancements that leverage their existing capabilities. For instance, Synopsys adds placement aware synthesis to it’s synthesis offering and congestion aware synthesis to that. They do this so they can drag customers along to adopt the new products / capabilities with little change to their existing flow. It’s only the the small companies that take the leap since they have nothing to lose.

    4) I agree – see #3


  4. Sean Murphy says:

    When you say that the Cadence-Mentor merger “may actually happen and be the right thing” I can meet you halfway: it may actually happen.

    If you had 1.6 Billion dollars to spend, would you really want to buy Mentor or a market basket of startups? In that sense I do agree that Cadence should be thinking more “Blue Ocean” than “Red Ocean.”

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