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Let's step outside the EDA box

Posted: 16 Oct 2003 ?? ?Print Version ?Bookmark and Share

Keywords:eda? electronics industry? market segment? networking industry? alternative marketing?

Luc Burgun is president and CEO of Emulation and Verification Engineering.
The electronics industry continues to view the economic recovery as "slow going," and it is hard to gauge whether we're wrong, since forecasts have become predictions or guesses, at best.

We are seeing some glimmers of excitement in narrow market segments, but have yet to find the market that will return us to spectacular growth and stellar earnings. Some industry executives have cautioned against ever seeing that again. I do not agree, but know that it may be awhile before we see a repeat of the headiness of the 1990s.

I suggest that we all take a collective deep breath and start thinking outside the box, instead of reverting to the tried-and-true style of growing the business by latching on to one hot market. Even now, after all we have been through, we tend to settle on one market segment and ride it, like a racehorse, until it drops. The industry needs to learn that we cannot operate this way any longer.

The networking industry is the perfect example. Telcos appeared to have an insatiable need for chips, tools and new ideas. They had plenty of money and grandiose plans to upgrade MANs, WANs and LANs and enable others such as home office networks. The electronics industry chased the telcos and network chip vendors - big and small - until the market was saturated and exploded.

We might have been more successful and less affected by the downturn had we identified a more diverse customer base with equal fervor.

Then, there is the EDA industry. It has appeared stymied lately as it tries to break the cycle of computer-aided design (CAD) budget cuts and ever-increasing technology challenges, and appears unable to reach much beyond $4 billion in yearly revenue. No one is predicting much more than modest growth for the foreseeable future.

Again, my suggestion would be to think outside the box. In EDA's hardware acceleration subsector, the answer may lie in selling outside of the traditional market segments as well as supporting traditional EDA markets.

In one uncommon application, our hardware emulator - through minor modifications - is being used to accelerate the compute power of number crunching and data gathering at an organization that's not an electronics company, or even an EDA supplier. It has been a successful venture, too. Our customer has already indicated that it will soon purchase more of our systems to get the equivalent performance of a farm of 1,000 PCs running Linux.

Don't get me wrong. I am not advocating drastic changes. No indeed. But, I am suggesting that we all think outside the box to find creative, alternative ways to grow sustainable businesses.

- Luc Burgun

President and CEO

Emulation and Verification Engineering

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