Virtual versus Vertical

Both ASIC and COT designs need the designer to fix the foundry at the onset. This is because the library and the design rules needed for both are supplied by the target foundry. COT, however, does have the flexibility for changing the foundry at a later stage provided the process is compatible across multiple foundries – however it still needs some verification to avoid problems on silicon. Multiple sources especially where one needs backups and also an advantage for price negotiations have been in the picture.

DFM does change a lot of value propositions. COT’s have been less costly not just because foundries compete on price but also because the extra service of design implementation in an ASIC comes with it’s own price tag. With DFM, the boundary between design and manufacturing is getting blurred and hence not many will opt for the traditional COT approach. Foundries will (and are) moving up in the design value chain.

With DFM, there is an increased need for foundries to share process information so that it’s taken into account during the design phase. Foundries collaborating with EDA vendors for this result into tools handling the yield issues while making it as transparent to the designer as possible. Design flows were devised and verified with specific tools (from single or multiple EDA vendors/sources) to tackle various design issues and facilitate FTSS. Now the verification of these flows includes another variable – foundry. i.e. a designer will need to know which foundry’s data has been used to verify the design flow before he starts using it.

Going to the next technology node has had a triple advantage – reduced power, higher speed and reduced cost due to lower die size. But as we go from 90nm to 65nm and further below, this shrink is leading to only a speed advantage. Leakage, signal integrity & yield issues have reduced the other two advantages. So, we’ll see lesser designs migrating to or starting up in these new technos. And this is besides the high costs involved (for design, mask etc.). Foundries like TSMC are spending a lot of money to build new fabs to handle these advanced nodes’ designs. So, after having invested a fortune, they can not let them be empty. There will be an economical need for them to see their foundries operate at capacity. For this, they will need to facilitate new designs in these technos; and hence they will be compelled to either share more information/collaborate or do every thing on it’s own i.e. a one stop shop.

TSMC executive sees more IP from foundry

To sell wafers, one needs tapeouts. Successful tapeouts require libraries and IPs validated on the target technology. And as technology advances, customers are more and more wary of getting their designs taped out with libraries and IPs not fully validated on silicon. So where does this lead a foundry with a ready advanced process but waiting for library & IP vendors to provide their wares on this new techno so that it can get customers’ designs in ?

Well, it provides libraries and IPs - either on it’s own or with partnerships. TSMC’s Europe Technical Director, Douglas Pattullo said in the IP/SoC conference in Grenoble on 7th Dec – TSMC is a provider not just of libraries but of complex IPs as well. He mentions that they are doing it to support their wafer manufacturing biz and not to get a new revenue stream.

It was once the same with EDA vendors. Quite a few of them started providing an IP portfolio – yes, to support their EDA biz. After all, customers are more comfortable with 3rd party IPs proven to be working in a specific design flow. But then as the process world started getting interleaved with the design world & the design space became abuzz with terms like DFM, DFY etc., the impact of foundry information on the EDA and IP space gained further importance.

So, are we headed towards a landscape dominated by a few major players (with deep pockets & partnerships) sporting One-Stop-Shops & dotted by smaller players excelling in niche areas say point EDA tools, special IPs ?

Bring on 2006

Mentors' CEO Walden Rhines' interview in Electronic Times (posted on 2/12/05) brought out 2 interesting points in the EDA industry :

First is on the EDA industry growth which Rhines attributes mainly to developing new solutions to new problems, developing new methodologies & applying technology to different applications. With a very small growth in the number of designers and with tools and methodology in place, design companies do not tend to spend so much in purchasing that many new licenses/seats.

The second interesting point is about start-ups. Usually started by professionals from the major EDA companies/design companies when they see issues/loops in the design flow which they feel they can plug in much better than the existing tools. With the market growing more and more towards point tools and now towards an open platform, they focus on a niche issue. While they contribute a little over 20% of the market revenue, they do represent a major chunk of the EDA methodologies mindshare. And excepting a few of them who have a solid business plan in addition to the strong technology base, most get acquired by the major EDA companies - and spur their growth.