BANGALORE, IndiaŚChief executives of companies, including semiconductor companies, are in the process of asking themselves on how best to address the Chinese and Indian markets, as these markets are the ones that are on top of everyone's mind, according to Lip-Bu Tan, president and CEO of EDA vendor Cadence Design Systems Inc.
Speaking to executives here, Tan said this is because semiconductor consumption in the two countries is not only rising but set to rise even more.
On the other hand, semiconductor companies, though having more than adequate cash reserves, are struggling for top line growth, without exception, Tan said.
"Every CEO is worried," Tan said. "We are going to be in a very challenging situation, not just economically, but also politically, in both Europe and the U.S."
Semiconductor companies are investing in designing the next killer application, but in terms of staff, most of them have imposed a freeze on hiring. There will be more consolidation in the semiconductor industry, Tan said, citing as an example the recent acquisition of National Semiconductor Corp. by Texas Instruments Inc.
"The number of startup companies in the semiconductor industry has dropped. This worries me as innovation typically comes more from startups," said Tan, who is also chairman of venture capital firm Walden International.
Cadence is investing in strategic programs such as 20-nm related work with foundries, in ARM-optimized solutions, high performance and advanced node design intellectual property and sees new applications, mobility, video, cloud computing and green technology as drivers of business in the future, Tan added.
All the time the semiconductor industry had a limited number of start ups where as software embedded start ups are raising. The reason being 1. Eduction in semiconductor design in universities are limited because this involves lot of physics and chemistry and few other areas of specific needs.
2. The cost involvement to set up one and the rate of returns are not matching.
3.Due to the first reason the field is always with the major players.
I think I'm not able to co-relate the title with the content of this article. From the title I comprehended that there are more opportunities in India and China seen by the Cadence CEO and others in semiconductor industry. But the content describes more about the weaker global scenario at present and near future.
I really doubt how best the semiconductor industry could draw benefit from Indian and Chinese market when the whole world is going through a difficult phase.
EDA market will not grow unless new startup companies are funded. India and China will consume end products. Cadence can not increase sales from India and China. So it is a investment problem. We can not expect big companies to innovate. India may not have product companies. No of SoC design stats per year is reducing. We have seen this before. I will post a link. It has product road map.
I have to agree, I am not sure how the EDA companies are going to address the "China & India" market! I assume Mr. Tan was talking more as a general CEO (not EDA), but the article makes irrelevant correlations between a perceived 'problem' of marketing in these countries with what needs to be done. Particularly the last comment "investing in strategic programs such as 20-nm related work" has absolutely NO relevance to India (from a strategic point of view!).
Dr. MP Divakar
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