I agree that a misaligned market expectations put a skewed stress on executives in managing their companies.
What starts as a technology company becomes a licence-revenue company in a saturated market. There is still revenue, but not in the way some shareholders expect.
Incidentally, I don't like the way newcomers coming into the field are bought up assimilated and neutered so they don't compete with the big established packages. This happened to Orcad and many others.
I can't blame the incumbents for defending themselves but it's a bitch when you invested in the low-cost software and you see it blown out of sight for being successful enough to annoy Big EDA.
Kris, for an EDA vendor I think the time has come to look at Silicon as a 'system' and offer design/simulation tools that help realize its implementation. If you look what Mentor has done by moving up and down the value chain, it seems to make sense. Mentor has made strategic moves to move in to mechanical/thermal analysis market, automobile harness design software, to cite a few examples.
In the burgeoning MEMS market as another, other than Tanner, none of the big three unify EDA tools with MEMS design tools.
Though consolidation may make sense to some extent, I don't believe it is the endgame for big EDA. There is plenty to be done in vertical markets that big EDA can leverage.
I would like to suggest a complete departure from the premise of consolidation in EDA -I think the industry NEEDS to grow in vertical markets. Of the big three, I only see Mentor making efforts to do this with what critics may call limited success (I am not one of them! I think Mentor will do well in many of the new markets entered).
If you look at the Ansys example, as an outsider to conventional EDA, it started by the acquisition of Ansoft, then Apache and now can arguably be called a vertically integrated EDA company.
I do see that the big three EDA companies are starting to react mainly driven by Ansys' consolidation as well the industry trends such as 3D stacked IC's where one needs to add multidisciplinary simulation into the design flows.
The author completely missed the boat. Many facts were wrong, just to list a few:
- maintaining/up keeping EDA software is hard, very hard in many cases. the cost is not 'muted'
- EDA software is not that hard to displace. The problem is that users do not want to invest in this area. In most cases, EDA vendors are the ones shouldering the cost.
There is only 1 problem in EDA : 3 vendors. All EDA users use this situation to maximize the agony of EDA vendors. All the problems the author talked about are the observe-able results of having 3-boxers in the ring at the same time. the only solution is to take 1 of the 3 out of the ring.