Gabe Moretti, Senior Editor
About two weeks ago the ESD Alliance held its 2017 CEO Outlook Panel. The panel used to be a yearly event for EDAC, the precursor of the ESD Alliance, but had not been held for a few years since.
I did not have the opportunity to attend the panel in person and was looking forward to read the entire transcript on the ESDA site. But there is no transcript. There is a picture of the panelists with Ed Sperling as the moderator, and a brief video showing introductory remarks from each of the panelists.
Unfortunately, the introductory remarks could have been delivered by a set of industry cheerleaders, since there was really no depth in them. You can guess the contents: greater need for silicon, IoT and IIoT (Industrial IoT) are the future. Lip-Bu Tan did say something interesting by addressing data architecture within the IIoT. Too many articles have been written about the IoT hardware architecture and I have found almost nothing that talks about the data architecture. Lip-Bu emphasized the need for local computational and decision making capability, thus limiting the need to transfer large amount of data up in the hierarchy of the system. Given the complex connectivity of a IoT system, where everything is potentially connected to everything else, security would be a major concern should the need to transfer a large amount of information arise. The smaller the amount of data transfer, the higher the security.
What Lip-Bu did not say, but is implied, is the need for distributed intelligence in the system with application specific hardware playing a greater role. It is back to the future. ASIC once again will step to the forefront replacing software based system running on general purpose hardware.
Wally Rhines noted that our industry economics are back at the levels of six years ago in spite of the significant consolidation of our customer base. It is called recovery, and our industry has had less of a recovery than most other industries.
The consolidation issue points out the real problem of the EDA industry. We sell tools used in the design and development of a product, not its manufacturing. Manufacturing volume means nothing to the EDA bottom line. Fewer “makers” means fewer “tools needed”.
Mentor is now part of one of its customers, so does such consolidation matter to Wally? I hear of course that Mentor will continue to do business in an independent manner, and that will be true unless and until a conflict of interest ensues. Will Mentor sell its best tools to companies directly competing with Siemens in a specific, competitive, market?
Simon Segers of ARM was also part of the panel. If he said something important as a result of now working for SoftBank, you could not have guessed it from his introductory remarks either. He just repeated Aart De Geus observation about the world needing more silicon. It has been clear since the acquisition that SoftBank other captive industries need more silicon and more IP cores, the reason for the acquisition! ARM will expertly create whatever SoftBank needs and will market what it creates to the outside world. The other way around will not happen, at least not in any important way.
Speaking as the scientist that he is Aart pointed out that as algorithms’ complexity increases the need for computational capability increases as well, thus the need for more silicon. It is an assumption that increased silicon production means increased EDA revenue. This is a fallacy, since EDA revenues are realized at the front end of the project and do not grow with product volume! The amount of EDA products that are used in wafer production and testing is small in comparison to the tools used to design and test before production.
There is also a significant difference in the revenue generated by different types of silicon. A 90 nm device requires less up-front investment in tools than a 10nm device. And there will be much more of the former than the latter type.
I think that reviving the CEO Panel is a good thing. It shows, at least, that accepted leaders of the EDA industry are willing to appear in public and deliver statements without fear of sounding irrelevant. And the lack of a full transcript, given the high level of professionalism now in the ESDA, must mean that nothing worthy of greater analysis was said during the panel.