According to a report in the EETimes.com web site (http://www.eetimes.com/news/design/showArticle.jhtml?articleID=198500411) Gary Smith EDA is estimating that the EDA industry grew by 11% in 2006. The EDAC Market Statistics Service (MSS) shows the growth for the first three quarters of the same year to be around 12%. Given the controversy among analysts and other industry watchers regarding the admissibility of IP revenues in the total EDA revenue, the two market study results are quite similar. Some editors, lead by Michael Santarini fo EDN, have stated that IP does not belong in EDA and taken EDAC to task because it included the revenue of publicly traded companies seen as exclusively IP companies. I have always maintained, instead, that IP blocks are an integral and necessary part of IC design and as such can, and must, be included to obtain a complete picture of our market.
Peggy Eycinena in an article for EDAcafe on February 12, 2007 asked for executives involved in IP whether or not they considered IP revenues to be part of EDA revenues, and all four of them disagreed. Specifically Warren Savage, President & CEO of IPextreme, said: "I would be one of the detractors, [arguing] that IP is not an extension to the EDA business model. It's been proven that EDA and IP are separate. IPextreme is a technology licensing company working with the large IDMs, helping them to monitize their internal IP to the global marketplace. We serve as a licensing agent, supporting the agents and outsourcing the IP function for vendors. I'm quite bullish on IP on the premise that IP is the fastest-growing aspect of the semiconductor industry, outpacing growth in semiconductors themselves, and EDA." I will point out that EDA companies do in fact are "technology licensing companies working (also) with the large IDMs" and so his point is to separate the IP sector from EDA in order to be able to claim faster growth, something that most assume to be attractive to investors.
Joel Silverman, Vice President of marketing at Kawasaki, Graham Allan, director of marketing at MOSAID, and Ian Mackintosh, president and chairman of OCP-IP, all agreed with Warren because the IP market has such significant growth. Of course, as I learned at Intel in 1977, it is much easier to achieve a 10% growth rate when your revenue is $100 million than when it is $1 billion. I do not think that the rate of growth in a market sector alone qualifies it to be handled as a separate industry. Otherwise, we will soon see DFM companies demanding that they be handled outside of the EDA industry also.
David Maliniak countered my argument that IP should be counted as part of the EDA industry revenue because it is used in IC and systems design by pointing out that so are workstations, and thus the revenue associated with them should also be counted. David is too young to remember that in fact their revenue was counted when EDA companies sold their proprietary workstations or OEM'ed workstations (like Mentor from Apollo). But now doing this would be impossible since engineers use generic computing systems for their work. Special hardware, like accelerators and emulators are part of the EDA revenue, so I am afraid that his argument is weak.
Clearly people are trying hard to separate IP from the EDA industry: but EDA companies continue to invest in this sector. Just yesterday, for example, Mentor announced the introduction by its IP division of a complete subsystem IP for USB. Obviously, wishes and reality do not always coincide.