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Cadence comeback strategy tied to platforms

Posted: 12 Apr 2004 ?? ?Print Version ?Bookmark and Share

Keywords:synopsys? cadence design system? encounter ic? implementation tool flow? soc?

One year after Synopsys Inc. unseated Cadence Design Systems Inc. as the top revenue earner in the design automation industry, Cadence is gearing up for a comeback. The company's strategy rests on integrated "platforms" containing best-of-breed tools, executives said.

Last year, Cadence's revenue fell as the San Jose company reached a weak part of its renewal cycle at the same time it was integrating technology from acquisitions Simplex Solutions and Get2Chip into its Encounter IC implementation tool flow. Cadence experienced some layoffs and morale problems as Synopsys and Magma Design Automation appeared to make inroads at its expense.

But a year makes a big difference, said Ray Bingham, Cadence president and CEO. "We believe we have a significant opportunity this year and going forward to grow our business by taking [market] share, primarily in digital design and SoCs [systems-on-chip]," said Bingham.

"Secondly, we believe we can grow the enterprise by what we refer to as 'widening the pond,' " he went on. "EDA, and especially Cadence, has an opportunity to participate in parts of our customers' product development that it hasn't traditionally participated in."

Bingham said the company now has not only a bleeding-edge IC implementation tool flow ready for the renewal cycle that's expected to kick in during the second half of 2004, but also a breadth of offerings-including digital, analog, package and printed-circuit-board design tools-that no other EDA vendor can claim.

Bingham said Cadence has a three-pronged strategy: acquire best-of-breed technologies, weave them into well-integrated platforms, and use the Open-Access database to connect those platforms to third-party and customer tools.

Cadence has some good possibilities this year, but also faces some challenges, said Gary Smith, chief EDA analyst at Gartner Dataquest. The good news, he said, is that Cadence is now shipping its Encounter IC implementation platform with the OpenAccess database. But more remains to be done, he said.

Market share shifts

Competitors are less impressed. "Synopsys does not believe there will be any meaningful shift in market share next year," said a Synopsys spokeswoman. "The key shift in market share has already occurred."

"One wonders why Cadence believes it will gain market share when designers move to 90- and 65nm, when it is losing market share at 130nm," said Nitin Deo, VP for product marketing at Magma.

In 18 months, Cadence has introduced four platforms, each addressing key design disciplines. The Encounter platform ties together the First Encounter floor planner, Get2Chip synthesis, the CeltIC signal integrity tool and the Nanoroute router. The Incisive platform links hardware-based emulation with simulation, while the Virtuoso platform ties together Cadence's longstanding analog and mixed-signal design and verification tools. The Allegro Platform, released earlier this month, allows users to trace signals from ICs through packages to PCBs.

The question for many is whether Cadence will catch Synopsys in 2004. CEO Bingham said he thinks the two companies will be about the same size this year. "The question is who will grow from here, and how fast they'll grow," he said. "We think we'll take significant share in digital design, and we think we're very competitive in verification. We think the right strategy was to invest in leading technology over the past couple of years."

- Richard Goering and Michael Santarini

EE Times

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