After a few very painful years for the semiconductor industry, it seems clear economic recovery is finally under way. The industry is showing signs of new life, and, as a result, EDA is buoyed. But this is a slow-moving train. We should expect a gradual uptick in business rather than a dramatic recovery in the tech sector.

Our customers, understandably, are moving cautiously. They're making huge bets in a period of uncertainty. That means that, more than ever, they are determined to squeeze maximum value from every dollar they spend, and EDA technologies and services are no exception. EDA companies that fare well now will be the ones that deliver that value.

The recovery comes at a crucial time, a turning point, for the electronics industry. The industry is undergoing a transformation; the complexities of nanometer design and the economics of developing chips and systems are forcing our customers to approach innovation differently than in the past.

Gone are the days when EDA companies could be simple tool vendors. Our customers expect, as they should, a commitment to help them achieve their ambitious business goals. We have become their partners in success, and that means providing more-complete front-end to back-end solutions for design, implementation, verification and ramp to silicon.

With the economy improving, the prognosis for our sector is good-at least for those companies listening to their customers and looking to align with the goals of our semiconductor partners.

As a baseline, our customers seek best-of-breed technologies. That's a given. They demand the best technology when they need it. Next, they want these best-of-breed technologies integrated into platforms that logically address their increasingly challenging design tasks. Leading electronics companies recognize the increased efficiencies attained by consolidating with vendors whose technologies are optimized to work well together, enabling their design teams to hit ambitious development targets.

Beyond our own branded technologies, we must work aggressively to provide our customers with the benefits of an open environment and industry collaboration. Our customers are tired of the turf wars that limit their alternatives and increase their costs. Open architecture initiatives like OpenAccess, which dramatically enhances interoperability-and cost savings-for our customers, are an important move in this direction. Further, we must be active facilitators in linking our customers to the silicon design chain. Resources like OpenAccess, as well as tight design chain collaboration, offer the efficiencies customers need to drive their own profitability and the health of our technology system.

Finally, but importantly, the EDA companies that fare best in this improving economy will be those that are aligned with their customers to directly improve silicon yield. For our customers, increased yield equals increased profitability. To help them achieve their business goals, we must help them develop yield-optimized designs that produce top-quality silicon-and for both digital and analog.

,Ray Bingham, Chairman Cadence DesignSystems Inc., San Jose, Calif.