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EDA to remain strong in 2007

Posted: 04 Jan 2007 ?? ?Print Version ?Bookmark and Share

Keywords:EDA? EDA industry? design? design tools? DFM?

The EDA industry grew faster than expected in 2006 and should have another good year in store, according to executives from large and small EDA companies. But a shakeout among design-for-manufacturability (DFM) startups could result in a bumpy ride, some warned.

Factors fueling EDA growth include a healthy semiconductor industry, an insatiable consumer electronics marketplace and a move to 65- and 45nm IC fabrication technologies. As a result of this move, DFM tools and technologies have come into strong demand. There's also been slow but notable progress with ESL tools and methodologies.

At the start of 2006, most EDA executives were predicting a somewhat lackluster year with single-digit growth, following four years of essentially no growth. In October 2006, however, a Gartner Dataquest report predicted a growth surge in 2006 of 13.3 percent, resulting in a forecasted $4.5 billion worldwide EDA tool market. The primary driver, the report said, is investment in DFM-aware IC design tools.

The Gartner report predicted a lower 8.5 percent revenue growth in 2007. Stronger growth will resume in 2008 and 2009, the report said, spurred by investment in ESL tools.

"It is clear to me that the EDA industry leaders have returned to innovation, and are offering end-to-end solutions for the enterprise," said Jim Miller, executive vice president for the product and technologies organization at Cadence Design Systems Inc. He noted the development of "solid" design flows for 65nm and said that many customers are skipping 90nm and going straight from 130nm to 65nm.

Design complexity and shrinking process nodes have forced a reassessment of design methodologies, resulting in EDA revenue growth, said Wally Rhines, Mentor Graphics Corp. CEO. "DFM and ESL led the way in 2006, as did the continuing rapid adoption of SystemVerilog," he said.

Rajeev Madhavan, CEO of Magma Design Automation Inc., also cited a rapid move to 65nm, but wasn't as impressed with the year's EDA developments. "In 2006, the emphasis and focus of EDA was on DFM, behavioral synthesis, sequential verification. Curiously, there was plenty of noise with little to show in the way of products."

The big question is whether EDA growth is sustainable into 2007 and beyond. Rhines thinks so. "Rapid growth of 65nm-and-below designs will continue to force new tool developments, and adoption of DFM and other design tools," he said. "For Mentor, software renewals for 2007 are looking very positive."

Signs that semiconductor R&D spending will continue to grow bodes well for EDA, said Cadence's Miller. "The current market segments and business drivers are strong," he said. Miller, however, predicted "considerable consolidation" in the DFM market.

Madhavan said that many of the venture-capital-funded ESL and DFM startups will close down in 2007 and 2008. "ESL product development will continue to be slow, and standalone DFM products will have a hard time surviving," he said. "Both will result in a large number of failures in EDA and cause the venture community to stay away from the industry until the next success."

- Richard Goering
EE Times

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