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All systems go for EDA in China

Posted: 03 Jan 2005 ?? ?Print Version ?Bookmark and Share

Keywords:eda? market? startup? row? tool?

Rhines: The market sector in china is a mixture of multinationals and locally-based companies and startups, and all have great potential for EDA business.

The market sector in China is a mixture of multinationals and local companies and startups, all wanting for EDA solutions. Companies with significant investment for China-based manufacturing, wafer fabrication and electronic design would need EDA products in their China facility just as they do in other locations. Meanwhile, many local Chinese companies, which used to focus on producing circuit boards, are now doing design, so they too are requiring more and more EDA tools.

In the 1980s, when Mentor first opened a China office, the few licenses available were intended for PCBs. Now, there is more demand for licenses to support complex IC design products. Since 2001, China has been the largest IC market in a region that analysts refer to as rest of the worldterritories outside of Europe, North America and Japan. Market research firm IC Insights predicts China's share of the worldwide IC market to nearly double over a five-year period, from 14 percent in 2003 to 24 percent in 2008. It is also expected to grow to more than 50 percent of the rest of the world IC market.

IC Insights forecasts a 17 percent electronic-system production growth rate in China between 2003 and 2010more than twice the average annual growth rate forecast for the worldwide electronic-system production in this period. Mainland's semiconductor consumption leaps ahead by one-third of its former total, fueled by demand from computer, communications and consumer electronics segments.

According to Gartner Dataquest, China's foundry revenue increased by 18 percent from 2002 to 2003. Gartner predicts a CAGR of almost 40 percent by 2008. Moreover, six 200mm and two 300mm wafer fabs are scheduled for production in China by the end of 2006. Leading EDA companies are partnering with local foundries to develop China's infrastructure for IC design, which requires tools for physical verification, extraction and nanometer design technology.

Local universities in China are producing thousands of engineers every yearmore than the United States and Europe combined. EDA companies partner with universities to provide students with hands-on design experience and leading-edge tools, expanding the pool of talented engineers likely to fuel the growth of local design companies. Gartner Dataquest estimates that 600 design houses already exist in China, a number that will definitely increase. As China grows its base of talented engineers and manufacturing know-how, its design houses will move into increasingly more complex design projects. And EDA companies will be there with the tools to make it happen.

- Walden Rhines
Chairman and CEO
Mentor Graphics Corp.

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