Probably the biggest driver of semiconductor (and hence EDA indirectly) at present are cellphones, especially smartphones. There are more memories shipped in phones (and tablets) than mainline PCs. The unit volumes are amazing (approaching two billion phones a year in a world of seven billion people).

IBM have released a fascinating video 50 Years of EDA. It is 30 minutes long but well worth the time it takes to watch.

It starts back in 1958 with what they consider the first EDA tool, a tool for tracking engineering change orders. This is before the invention of the first integrated circuit. The video covers some of the aspects of manual design used back then. The first real technology that was developed was the LSSD test approach since they were having problems testing components for mainframes.

The recently released EDA Consortium Market Statistics Service (MSS) report for calendar Q3 2011 shows overall EDA industry annual growth of 18.1%, compared to Q3, 2010. The report also shows sequential growth of 7.4% compared to Q2, 2011. EDA industry revenue for Q3 was $1,544 million.

“Growth in the EDA market was exceptionally robust across the board,” said Walden C. Rhines, EDAC chair and chairman and CEO of Mentor Graphics. “Revenue grew in every major product category and in every region.”

Semiconductor companies are continuing to invest in R&D for new products. This results in increased spending on new tools to address the challenges presented by advanced process nodes. This is also reflected in the increased employment reported by EDA companies in Q3, as the EDA industry develops new products with new capabilities to address these challenges.

Each quarter, the EDAC Market Statistics Service collects revenue data from public and private EDA companies, and compiles the data into the MSS report. This report contains industry revenue broken out into major categories including CAE, IC Physical Design & Verification, Printed Circuit Board & Multi-Chip Modules, Semiconductor IP, and Services. Geographic regions include The Americas, Europe, Middle East and Africa (EMEA), Japan, and Asia/Pacific. The categories are further refined into detailed sub categories in the report, available to EDAC members.

Additional revenue details are available in the MSS Newsletter at http://edac.org/mss/newsletter.jsp.

See you at the 2012 Design Automation Conference,  June 3-7 in San Francisco!

Paul Cohen, EDA Consortium...

EDAC (EDA consortium) market statistics service announced the data for Q3 of 2011. Revenue increased 18.1% (versus 2010) to $1543.9 million. Sequentially (versus Q2) revenue increase 7.4%. Annualized, that puts EDA at over $6B for, I belive, the first time ever.

Wally Rhines, who is EDAC chair (and CEO of Mentor) commented that "growth was exceptionally robust across the board, in every product category and every region."

Breaking it down: CAE revenue was $566.7 million (10.5% up on Q3 2010) IC physical design and verification was $338.3 million (16% up on 2010) PCB and MCM was $140.3 million (up 11.6% on 2010) Semiconductor intellectual property, or what we usually just call IP, was $510 million (up a huge 37.4% from last year) Services was $88.7 millionn (up 13.1% on 2010)

I just read that Microsoft has decided that this will be the last year that they attend the Consumer Electronics Show. For years they have had the biggest booth, and either Gates or Ballmer has given the keynote. Apple doesn't attend CES either, and even announced the iPhone during CES but at their own Apple event, thus stealing all the thunder from the whole show.

Microsoft say that they prefer to make announcements on their own schedule rather than be driven by a tradeshow. In fact nothing very interesting has been announced at CES recently, mostly televisions and tablets and such that are like ones already on the market.

T’is the season to be jolly…and to predict the next year’s semiconductor market. The news is mixed. KPMG does a regular survey of senior executives in semiconductor companies to get their outlook on the year ahead. The message this year is mixed. 41% of executives expected their business to grow by more than 5% next year, which sounds not too bad until you realize that last year it was 78%. The survey included over 150 executives, half from companies over $1B in revenue The Semiconductor Business Confidence Index is at 46 compared to 60 the last couple of years (higher is better). GSA also announced that so far this year there have been nearly 100 semiconductor acquisitions and mergers, down a little from a year ago. Not surprisingly, the big drivers for semiconductor are wireless (probably over 2 billion cell-phones will be sold next year), computing (cloud server and laptops etc) and consumer (video game, TV, DVR etc). The big indicator in semiconductor is capital equipment, because this is where companies put (or don’t) their money where their mouth is. Revealed preferences, an economist would say, which is much more important than what executives say in a survey. Here many executives plan to sit on their hands next year, with only a quarter expecting it to increase next year. Since a fab doesn’t get built in a month or two, this is an indicator of capacity that won’t be in place for 2013. There is also huge variability between different companies. Intel is clearly investing a huge amount whereas other companies are still switching to a fab-lite or fabless model where capital expenditure is not required (well, by the company: TSMC still needs to invest plenty). And the other big foundry, Global, is clearly struggling. They have a big fab in New York that is meant to come on line but they are also losing a lot of their semi-captive AMD business to TSMC. The amounts involved are staggering. Intel is talking about $10B fabs. And because it can’t risk having just one fab (in case it burns down or something) they need to build two. But even Intel can’t fill two fabs hence all the speculation about Apple, Qualcomm, Xilinx and others using Intel as a foundry. Depending on details, a $10B fab depreciates at about $10M/day or $100/second so to fill such a fab requires doing business at about 4 or 5 times that rate. So semiconductor companies have had a two-year boom and are assuming next year will be slow. To some extent these can become self-fulfilling prophecies depending on how much capacity is put in place. If not enough, product will be on allocation even if there is end market demand, too much and prices crater creating end market...