EDACafe Editorial 
Peggy Aycinena
Peggy Aycinena is a contributing editor for EDACafe.Com Black Magic Woman to Bobby McGee: Fiddling into the night as Rome burnsJune 9th, 2015 by Peggy Aycinena
After a long day concentrating at DAC, it’s odd to spend the early hours of the evening at a DAC party. So much noise, loud music, silly carryings-on, when all one wants to do really is compose an essay about the impressions of the day. So how about a compromise. Sit on the edge of the dance floor and write. Glass of lovely Sauvignon Blanc, plate of shrimp, an egg roll or two. It’s sorta like being in a coffee shop, but louder. Back in the day, Carlos Santana dated a high school friend of mine. Black Magic Woman, indeed. It’s like writing in a coffee shop called Time Warp. So the point of this essay is specific. To capture as accurately as possible a thesis expressed to me an hour ago when I first came into this Love IP Party at Jillian’s, a pool and pub venue just across from Moscone Center. This particular Anonymous Source has seen everything in the EDA industry. Literally. And knows everyone. Literally. No joking. His thesis? EDA (as we knew it) is over. Not dead, but over. Unequivocally. Why? The customers are consolidating. Massively. And they never paid well in the first place, so with the consolidations they’re ponying up even fewer dollars for tools — and even more reluctantly, The term is squeeze. As in, squeeze the suppliers til they squeal. Of course, in this case, the squeezers would be the semiconductor guys, while the squeezors would be their EDA tool suppliers. And the end result is bad. Painful and bad. Subsequently, the major EDA tool suppliers — the Big Three — have fewer resources, and ergo are forced to forgo innovation on any scale other than puny. Plus, they’re so busy servicing the current needs of their customers with their all-you-can-eat business models, that not only do these EDA tool suppliers not innovate, they deal with their smaller EDA startup colleagues by buying them up before those smaller, nimbler startups can compete effectively. Or the Big Three suppliers sue their small startup colleagues until the youngsters bleed and die for fear newer (better) technologies might actually garner even the tiniest market traction. So here’s the process: Semi companies consolidate and squeeze their tool vendors by paying too little for tools. The tool vendors recoil/react by squeezing their smaller colleagues out of existence. The small EDA startups can’t survive. The attractiveness of EDA startups as a target for VC money disappears. VC money flees, moving to greener pastures like enterprise software or social networking, and the pressure on small EDA startups becomes even more intense. The small startups wither, die, are acquired, disappear. Meanwhile, the power of the Big Three grows and grows. Cadence buys Sigrity, Forte, Jasper. Synopsys buys Magma, EVE, Atrenta. Mentor buys BDA, Nimbic, Tanner. The world as we knew it ceases to exist, and things get unbelievably boring. As I stood listening to Anon’s narrative, it all seemed so forlorn and wrong. Reluctant to offend, I commented nonetheless: It seems like there’s something vaguely corrupt in this story. Anon laughed and said: This is not about corruption. It’s about nothing more than the story of an industry maturing into middle age. Are you offended that there are only three automobile manufacturers in Detroit, and that it’s been that way for decades? No? Then why is it a problem that there are really only three suppliers in EDA? I did not have an answer. Anon had one last comment, however. It’s true, he said, that the industry’s maturing, but it’s also sad. There is no investment for startups, and those small companies that do survive only have one exit. Be acquired. So we’re really witnessing the end of the EDA ecosystem. Where things in the 80’s and 90’s were full of innovation and a sense of energy and excitement, today it’s just about consolidation and customer lock-in. Anon stood up and said a cordial goodbye. He walked out of the door of the pub, into the wind-whipped streets of San Francisco, and on into history. I turned and went on inside. Which brings us to this 60’s party at Jillian’s and my quiet booth next to the dance floor. Jim Morrison, Grace Slick, Janice Joplin and friends are dancing nearby, laughing and living large. As Jim Hogan and pals run through the entire Summer of Love Song Book for their adoring fans here, it’s obvious to even the most casual observer that the EDA industry is aging, even expiring, right out of existence, right before our very eyes. Yes, now is a different time. This party may be in the here and now, and this week’s DAC as well, but it’s built on the free-wheeling spirits of the past, on the innovations and zany ideas of so many who have gone before. Those folks who built an industry in their youth, and upon which the most phenomenal technical advancements in the history of humankind have themselves been built. Rome wasn’t built in a day, but once built neither did it last forever. The goodbye was a long time in coming. EDA wasn’t built in a day, but having been built it also will not last forever. The goodbye is a long time in coming. But somewhere between Haight Ashbury out to the west of here and this neighborhood near Moscone, the wind is telling the tale. Freedom’s just another word for nothing left to lose. Next?
Busted flat in Baton Rouge, waiting for a train I pulled my harpoon from my dirty red bandanna, Freedom is just another word for nothing left to lose,
Tags: 52DAC, Black Magic Woman, Bobby McGee, Cadence, Carlos Santana, Grace Slick, Janis Joplin, Jim Hogan, Jim Morrison, Kris Kristofferson, Love IP Party, Mentor Graphics, Synopsys One Response to “Black Magic Woman to Bobby McGee: Fiddling into the night as Rome burns” |
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All valid observations, Peggy, but I would clarify that EDA is done in the West for all the reasons you state. In Asia and India it is doing quite well especially for start-ups. I heard of one particular company in Taiwan that is “eating Synopsys’ lunch” from several customers who did not want to be identified and asked that I not mention the company name. Why the hoi polloi of EDA don’t know this is because these companies don’t come to DAC. They don’t come to DATE. In fact, so far they have meticulously avoided the trade show circuit altogether as they apply themselves to the process of lead development and marketing with customers that the Big Three won’t even talk to… basically because they don’t know there are customers outside of the ever shrinking market they serve.
I meet with companies from the east often and am impressed with their level of innovation and quality of their tools and am pleasantly surprised when they say they would rather I not write about them as going public might complicate their process. They are building relationships and business before embarking on a grand reveal.